| The purpose of this study is to determine the relationship between inflation and economic growth in Indonesia in the long run, using the data of inflation and economic growth in Indonesia period 1984 to 2010. The results of this study indicate that in the long run, inflation in Indonesia has a negative and significant impact on Economic Growth. This is appropriate with the research conducted by Javier Andrés and Ignacio Hernando, followed by Michael Bruno and William Easterly, where inflation in the long run is never positive or do not contribute significantly to economic growth. The research model used by the author is Simple Linear Regression. The data analysis methods used are Stationerity test, Classic Assumption Test (Autocorrelation Test and Heteroskedasticity Test), and Hypothesis Test (t-test and F-test). Inflation coefficient shows, rate of -0.248114 stated that if inflation rises by 1 unit, it will lower the Economic Growth by 0.248114. In addition, inflation contributed to 72.8% of economic growth, where the rest is influenced by other factors such as exchange rates, unemployment, and investment levels. |