An Inflation Rate Prediction Based on Backpropagation Neural Network Algorithm

(1) Purnawansyah Purnawansyah Mail (Universitas Muslim Indonesia, Indonesia)
(2) * Haviluddin Haviluddin Mail (Scopus ID: 56596793000; Departement Ilmu Komputer; Universitas Mulawarman, Indonesia)
(3) Hario Jati Setyadi Mail (Fakultas Ilmu Komputer dan Teknologi Informasi Universitas Mulawarman, Indonesia)
(4) Kelvin Wong Mail (Fakultas Ilmu Komputer dan Teknologi Informasi Universitas Mulawarman)
(5) Rayner Alfred Mail (Universiti Malaysia Sabah, Malaysia)
*corresponding author

Abstract


This article aims to predict the inflation rate in Samarinda, East Kalimantan by implementing an intelligent algorithm, Backpropagation Neural Network (BPNN). The inflation rate data was obtained from the Provincial Statistics Bureau of Samarinda https://samarindakota.bps.go.id/ for the period January 2012 to January 2017. The method used to measure accuracy algorithm prediction was the mean square error (MSE). Based on the experiment results, the BPNN method with architectural parameters of 5-5-5-1; the learning function was trainlm; the activation functions were logsig and purelin; the learning rate was 0.1 and able to produce a good level of prediction error with an MSE value of 0.00000424. The results showed that the BPNN algorithm can be used as an alternative method in predicting inflation rates in order to support sustainable economic growth, so that it can improve the welfare of the people in Samarinda, East Kalimantan.

Keywords


BPNN; MSE; Prediction; Inflation Rates; Economic

   

DOI

https://doi.org/10.29099/ijair.v3i2.112
      

Article metrics

10.29099/ijair.v3i2.112 Abstract views : 1633 | PDF views : 454

   

Cite

   

Full Text

Download

References


E. U. A. Gaffar, I. Gani, Haviluddin, A. F. O. Gaffar, and R. Alfred, “A Heuristic Network for Predicting the Percentage of Gross Domestic Product Distribution,†in Proceeding - 2018 International Symposium on Advanced Intelligent Informatics: Revolutionize Intelligent Informatics Spectrum for Humanity, SAIN 2018, 2019.

N. R. Sari, W. F. Mahmudy, and A. P. Wibawa, “Backpropagation on neural network method for inflation rate forecasting in Indonesia,†Int. J. Adv. Soft Comput. its Appl., 2016.

S. Gupta and S. Kashyap, “Forecasting inflation in G-7 countries: An application of artificial neural network,†Foresight, 2015.

S. Mullainathan and J. Spiess, “Machine Learning: An Applied Econometric Approach,†J. Econ. Perspect., vol. 31, no. 2, pp. 87–106, 2017.

R. Dutu, “Why has economic growth slowed down in Indonesia? An investigation into the Indonesian business cycle using an estimated DSGE model,†J. Asian Econ., 2016.

N. Semuel, Hatane; Stephanie, “Analysis of the Effect of Inflation , Interest Rates , and Exchange Rates on Gross Domestic Product ( GDP ) in Indonesia,†Proc. Int. Conf. Glob. Business, Econ. Financ. Soc. Sci., 2015.

M. J. B. Hall, D. Muljawan, Suprayogi, and L. Moorena, “Using the artificial neural network to assess bank credit risk: A case study of Indonesia,†Appl. Financ. Econ., 2009.

A. Prastyo, D. Junaedi, and M. D. Sulistiyo, “Stock Price Forecasting Using Artificial Neural Network,†Fifth Int. Conf. Inf. Commun. Technol., 2017.

R. Dharwal and L. Kaur, “Applications of Artificial Neural Networks : A Review,†Indian J. Sci. Technol, vol. 9 No. 47, pp. 1–8, 2016.

M. Lehtokangas, “Modelling with constructive backpropagation,†Neural Networks, 1999.

R. Rojas and R. Rojas, “The Backpropagation Algorithm,†in Neural Networks, 2011.

A. Graves, “Supervised Sequence Labelling with Recurrent Neural Networks,†Stud. Comput. Intell., 2012.

M. T. Hagan and M. B. Menhaj, “Training Feedforward Networks With The Marquardt Algorithm,†IEEE Trans. Neural Networks, vol. 5, no. 6, pp. 989 – 993, 1994.

B. M. Wilamowski and H. Yu, “Neural network learning without backpropagation,†IEEE Trans. Neural Networks, 2010.

Haviluddin, R. Alfred, J. H. Obit, M. H. A. Hijazi, and A. A. A. Ibrahim, “A performance comparison of statistical and machine learning techniques in learning time series data,†Adv. Sci. Lett., 2015.

A. Susanti, Suhartono, H. J. Setyadi, M. Taruk, Haviluddin, and P. P. Widagdo, “Forecasting Inflow and Outflow of Money Currency in East Java Using a Hybrid Exponential Smoothing and Calendar Variation Model,†J. Phys. Conf. Ser., vol. 979, p. 012096, Mar. 2018.




Creative Commons License
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

________________________________________________________

The International Journal of Artificial Intelligence Research

Organized by: Departemen Teknik Informatika
Published by: STMIK Dharma Wacana
Jl. Kenanga No.03 Mulyojati 16C Metro Barat Kota Metro Lampung

Email: jurnal.ijair@gmail.com

View IJAIR Statcounter

Creative Commons License
This work is licensed under  Creative Commons Attribution-ShareAlike 4.0 International License.