The relationship of cement consumption and economic growth : an updated approach

Abstract

Purpose: This research aims to make an update how much volume of cement is needed for Indonesia, to disclose cement consumption for Indonesia and the relationship between cement consumption and several variables as inflators that influence cement consumption. Design/methodology/approach: The methodology used is regression analysis and descriptive analytics. The data period taken is primarily within the period of 2010-2018, but cement consumption and other variable inflators have been assessed within a longer period of 2007-2018. Findings: The findings are that national economic growth as inflator for cement consumption is no longer proven as by nature to develop robust models but must access of more than one predictor. Based on findings, by calculating cement consumption based on real consumption at every project are better than rely-on national economic growth. Practical implications: The recent model of cement consumption has been no longer as the inflator of economic growth and vice versa. An update for the cement consumption is urgently needed. Economic growth is no longer a predominantly inflator for the cement consumption. There is no obligation to consume more cements in purposing to drive economic growth. Originality/value: This research has been developed by the author from yearly observations and experiences at the cement sector in Indonesia.