DETERMINING FACTORS URGE A REDENOMINATION

Abstract

The purpose of this research was examined factors urge a redenomination. While
decisions on denomination and design of currencies may seem more technical than
political, a government’s control and administration of its currency and transactions
within its boundaries is one of the hallmarks of the modern nation -state. With the
discourse of the Indonesian central bank researchers wanted to investigate about the
proper inflation level to take the redenomination. This Research aims at analysing the
effect variable of inflation, exchange rate and index democracy on redenomination, and
to identify the most variable than in affective redenomination. The population of this
research is a country that is listed at the World Bank. Data used is secondary data. By
using a purposive sampling method states that have complete data in the research
consisted of 36 countries. The data is analyzed using of binary logistic regression
statistical tests and with the help of SPPS V.13.0 software and Microsoft Excel
2007.The results of this research indicate that (1) exchange rate no significant effect on
the decision to redenomination, (2) Form of government no significant effect on the
decision to redenomination, (3) inflation significantly influence decisions
redenomination of the most special is the inflation t-5. A country does not do
redenomination is directly due to the socialization and factors - factors of conflict
within a countries.