Law and Economic Performance: An Analysis of Regulatory Frameworks and Market Efficiency

Authors

  • Ludia Panggalo Institut Jambatan Bulan, Mimika, Indonesia.
  • Habel Taime Institut Jambatan Bulan, Mimika, Indonesia.
  • Siske Tontong Institut Jambatan Bulan, Mimika, Indonesia.
  • Muh. Sabir Institut Jambatan Bulan, Mimika, Indonesia.

DOI:

https://doi.org/10.38035/gijlss.v4i5.924

Keywords:

Sustainable Regional Economic Growth, Green Infrastructure Investment, Regulatory Framework Quality, Market Efficiency

Abstract

This study examines the drivers of sustainable regional economic growth and economic performance through two complementary structural models analyzed using SmartPLS. Model 1 evaluates the role of Green Infrastructure Investment (GII) in influencing Environmental Quality (EQ), Economic Performance (EP), and Sustainable Regional Economic Growth (SREG). Model 2 explores how Regulatory Framework Quality (RFQ), Legal Certainty (LC), and Market Efficiency (ME) affect Economic Performance. A quantitative approach based on Partial Least Squares Structural Equation Modeling (PLS-SEM) is employed to assess both measurement and structural relationships. The results indicate that all constructs demonstrate strong reliability and convergent validity. The structural model demonstrates strong explanatory power, with -square values exceeding 0.98 across endogenous variables in Model 1, and ranging from 0.898 to 0.966in Model 2. In Model 1, green infrastructure investment has a strong positive impact on environmental quality and economic performance, while environmental quality significantly enhances sustainable growth. However, economic performance and the direct effect of green investment on sustainable growth show negative relationships, indicating short-term trade-offs. In Model 2, regulatory framework quality strongly influences legal certainty and indirectly improves economic performance through market efficiency. Overall, the findings highlight the importance of integrating environmental investment and institutional quality to achieve sustainable and efficient economic development.

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Published

2026-11-07

How to Cite

Panggalo, L., Taime, H., Tontong, S., & Sabir, M. (2026). Law and Economic Performance: An Analysis of Regulatory Frameworks and Market Efficiency. Greenation International Journal of Law and Social Sciences, 4(5), 1930–1939. https://doi.org/10.38035/gijlss.v4i5.924

Issue

Vol. 4 No. 5 (2026): (GIJLSS) Greenation International Journal of Law and Social Sciences (November - December 2026)

Section

Articles

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Copyright (c) 2026 Ludia Panggalo

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