Assessing Economic Interaction and Institutional Effectiveness on the Economies of ASEAN Countries: A PLS-Structural Equation Modeling Analysis

Setyo Wira Rizki 1,2, Nikolay I. Didenko 1

1 Peter the Great St. Petersburg Polytechnic University, Saint-Petersburg, Russia
2 Tanjungpura University, Pontianak, Indonesia

Abstract

In a multipolar world, a study of regional integration is highly relevant for understanding how economic interactions can foster economic growth, global competitiveness, and stability amid global uncertainty. The research highlights the significant impact of economic interactions and institutional performance on economic development in Southeast Asian. This study aims to investigate the impact of economic interactions and institutional performance on the economy. Trend visualization shows that Singapore gains the highest intra-investment and intra-trade, meanwhile Malaysia gets the highest intra-human mobility. Furthermore, a hypothesis can be developed that economic interactions and institutional performance have a significant impact on ASEAN’s economy. The PLS-SEM analysis is employed to investigate the significance of the hypothesis. The model involves four latent variables such as economic interaction, economic growth, institutional performance, and economic determinants. The economic interaction variable is considered a manifestation of regional integration commitment, which is regulated in the cooperation policy of state institutions in this regional area. Economic interaction is represented by intra-export, intra-import, intra-FDI, and intra-human flow indicators. The results of the significance test indicate that institutional performance has a very strong direct impact on economic interactions. It supports the theory of Institutional Neoliberalism and New Institutional Economics. Moreover, Institutional performance and economic interaction do not have a direct impact on economic growth. However, the economic interactions supported by institutional performance have a significant impact on economic growth. It offers new insights, suggesting that economic interaction must be supported by institutional performance to have a significant impact on economic growth in ASEAN countries.

Keywords

geopolitical regions; economic connectivity; regional integration; good government; multipolar world.

JEL classification

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About Authors

Setyo Wira Rizki

Post-Graduate Student, Institute of Industrial Management, Economics and Trade, Peter the Great St. Petersburg Polytechnic University, Saint-Petersburg, Russia (195251, Saint-Petersburg, Polytechnicheskaya street, 29); Master of Science, Lecturer of Statistics Department, Faculty of Mathematics and Natural Sciences, Tanjungpura University, Pontianak, Indonesia (78112, Pontianak, Prof. Hadari Nawawi street); ORCID orcid.org/0000-0003-0829-9767 e-mail: rizki.sv@edu.spbstu.ru

Nikolay Ivanovich Didenko

Doctor of Economics, Professor, Institute of Industrial Management, Economics and Trade, Peter the Great St. Petersburg Polytechnic University, Saint-Petersburg, Russia (195251, Saint-Petersburg, Polytechnicheskaya street, 29); ORCID orcid.org/0000-0001-8540-7034 e-mail: didenko.nikolay@mail.ru

For citation

Rizki, S.W., Didenko, N.I. (2026). Assessing Economic Interaction and Institutional Effectiveness on the Economies of ASEAN Countries: A PLS-Structural Equation Modeling Analysis. Journal of Applied Economic Research, Vol. 25, No. 1, 44-73. doi.org/10.15826/vestnik.2026.25.1.002

Article info

Received December 17, 2025; Revised January 11, 2026; Accepted January 13, 2026.

DOI: http://dx.doi.org/10.15826/vestnik.2026.25.1.002

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