50
7. Adjusted R
2
Adjusted R
2
is the determination coefficient that explain how much the dependent variable variant described by the model in the whole. The
value of adjusted R
2
is in between 0 and 1. More closer the value of R
2
to the 1, it means that the independent variables perfectly affecting the
dependent variable or with the other word, the model can describe the variant of dependent variable well.
E. Variable Operational Research
1. Independent Variables
Independent variable is one that influences the dependent variable in either postivie or negative way. When the independent variable is present,
the dependent variable is also present Sekaran, 2003:89. The independent variables used in this research are:
a. GDP Growth
GDP is the sum of gross value added by all resident producers in the economy plus any product taxes and minus any subsidies not
included in the value of the products. Annual percentage growth rate of GDP at market prices based on constant local currency.
b. Inflation
Inflation as measured by the Consumer Price Index reflects the annual percentage change in the cost to the average consumer of
acquiring a basket of goods and services.
51
c. Unemployment
Unemployment rate is the ratio of the number of people employed to the total number of of people in the labor force.
d. ImportGDP
Imports of goods and services represent the value of all goods and other market services received from the rest of the world. They
include the value of merchandise, freight, insurance, transport, travel, royalties, license fees, and other services, such as
communication, construction, financial, information, business, personal, and government services. They exclude compensation of
employees and investment income formerly called factor services and transfer payments
www.worldbank.org .
e. Current Account Balance
Current account balance is the sum current account balance is net exports of goods, net exports on services, net invetment income
and net transfer payments.
2. Dependent Variable
According to Sekaran 2003: 88, dependent variable is the main variable that lends itself for investigation as a variable factor. This
research is using CDS spreads as a dependent variable. CDS spreads reflect market participants assessment of the risk of a default or credit
event associated with the underlying obligation. The CDS premium or
52
spreads are measured in basis points bps. The CDS spreads with the 5 years maturity is used in this research.
53
CHAPTER IV FINDING AND ANALYSIS
This chapter consists of several sections that will describe the analysis and the result of the hypothesis testing.
A. General Description of Research Object
This research uses 14 countries consist of 9 Asian countries and 5 European countris as a sample and 5 years period as the total of the
population. The sample and the popultion had choosen based on the judgemental or purposive sampling. According to Malhotra 2004: 322
judgmental sampling means that the population elements are selected based on the judgment of the researcher. The researcher, exercising judgment or
expertise, chooses the elements to be included in the sample, because he or she believes that they are representative of the population or they are
otherwise appropriate. The object of this research are Credit Default Swap spreads, GDP growth,
Inflation, Unemployment, ImportGDP, and Current Account Balance. The data are obtained from Bloomberg, Indonesian Ministry of Finance,
www.worldbank.org and
www.quandl.com .
Kategori