- Problem Definition
How much cost required of running for President in Indonesia? There is no open source for public knowledge and transparency of presidential cost from one candidate to others. In this blog I try to estimate presidential cost for next general election planned in 2014.
Figure 1 Indonesia General Election 2014
- Identify the Feasible Alternative
Since there is no available record for Indonesia, then I used the cost from United States correlated with gold cost per ounce, burger mac [BMI] and iPhone index. Indeed, my estimate will be not accurate enough since this is parametric estimating that fit with class 5 or 4 estimate level.
- Development of the Outcome for Alternative
- United Stated Presidential Cost
The historical data of presidential cost in United States with the projection in year 2014 present in Figure 2:
Figure 2 Projection United States Presidential Cost in Year 2014
Regression exponential with correlation factor R^2 = 93.8% gives 1,943.41 M-USD for 2014 year.
- Correlation Using Gold Cost per Ounce
Same projection process using available data,  &  for US and IDR gold in year 2014 [for IDR gold taken with Z90] present in Figure 3:
Figure 3 USD and IDR Gold Cost Projection in Year 2014
The gold quantity required for presidential election in United States in year 2014 is 1,943.41 M-USD / 1,549.72 USD per ounce = 1.25 M-ounce of gold. The cost required for Indonesia presidential election in year 2014 will be 1.25 M-ounce of gold * 17.22 M-IDR per ounce = 21.6 T-IDR.
- Correlation Using Burger Mac Index [BMI]
List of BMI index is always updated per year, and from the graph it shows that produced moving average mode with low correlation factor. For calculation I take the latest BMI index in year 2013 present in Figure 4:
Figure 4 BMI for Year 2014
The cost required for Indonesia presidential election in year 2014 is 1,943.41 M-USD * 5,364.24 BMI index = 10.5 T-IDR.
- Correlation Using iPhone Index
Not much historical data available for iPhone, so for the index I take the 4S 16 GB series un-locked with the US and IDR price in year 2013 for calculation present in Figure 5:
Figure 5 iPhone Calculation for Presidential Cost in Year 2014
- Selection Criteria
My main target is estimating the cost for presidential in Indonesia using three correlations above since in Indonesia we don’t have such kind of information.
- Analysis and Comparison of the Alternative
The result from three correlations above present in Figure 6:
Figure 6 Comparison Estimate of 2014 Presidential Cost in Indonesia
It can be seen that the result comes from iPhone index and gold correlation give close value to 22 T-IDR compare to BMI index. It doesn’t mean that BMI index gives wrong result since each correlation forms in different quantity [ounce of gold, x number of burgers or iPhones].
- Selection of the Preferred Alternative
If I only take the representative value from three results then for Z90 the value of presidential election in Indonesia will be around 22 T-IDR [close with gold correlation].
- Performance Monitoring and the Post Evaluation of Result
For transparency and accountability purpose, the cost required for presidential election should be published since they are expensive. Besides in numbers, they can also form into equivalent gold quantity as gold having purchasing power until now.
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goldrate24.com. (2013). Indonesia 2013 Gold Prices. Retrieved from http://www.goldrate24.com/gold-prices/asia/indonesia/.
bigmacindex.org. (2013). Big Mac Index. Retrieved from http://bigmacindex.org/2013-Big-Mac-Index.html.
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