Green Economy Model on Economic Fundamentals in Indonesia

Green economy, as an economic concept that prioritizes a sustainable economy, has a correlation with economic fundamentals. Green economy not only covers aspects of economic growth, but also places the importance of environmental preservation and social empowerment as the main focus. These principles are the aim of the research to form a strong basis for building an economic model that not only provides long-term benefits for society and the environment, but also strengthens overall economic fundamentals in a sustainable way in Indonesia. VAR (Vector Autoregression) in the context of econometric analysis is a statistical method used to model the relationship between several time-series variables in research conducted. VAR analysis shows that result The VAR estimation results highlight the contribution of the Green Economy variable to Economic Fundamentals. GDP is mainly influenced by Greenflation and Green Consumption, indicating the significant impact of environmental inflation and green consumption. Green Credit is also influenced by these two factors, while Greenflation is influenced by GDP and Green Consumption. IRF analysis reveals variable responses to change, highlighting the importance of response stability in the medium to long term. In the Green Economy model, GDP growth and green consumption are the main pillars, driven by increased Green Consumption and Green Credit. The analysis results confirm the importance of adopting environmentally friendly practices in driving sustainable economic growth, in line with previous findings highlighting the positive impact of green technology and sustainable practices. The establishment and development of the Green Economy Model has a significant impact on economic fundamentals, providing a strong basis for sustainable and innovative economic policies. VAR analysis of IRF and FEVD tests helps reveal complex interactions between green economy variables, providing valuable insights for the formulation of effective and sustainable policies. Keywords: Green Economy, Economic Fundamentals, VAR