Indonesia's regional socio-economic data base extends over 30 years, so it is now possible to draw conclusions about regional development dynamics since the 1970s. We examine economic growth, inequality, convergence, structural change, demographic dynamics and social indicators over this period. There continues to be great diversity in economic and social outcomes, but growth and social progress have been remarkably even: the poorest regions, located mainly in Eastern Indonesia, have generally performed about as well as the national average. The better performing regions include those that are the most 'connected' to the global economy. In this respect, Jakarta stands out, growing richer than the rest of the country over time. As expected, conflict is harmful to economic development. There is no clear natural resource story: the performance of the resource-rich provinces has varied considerably.

The paper describes a method of small area estimation which uses a reweighting algorithm to reweight survey data to a number of known totals (benchmarks) for small areas. The method has so far been used to estimate small area poverty rates and housing stress. The method gives poverty rates for small areas that are similar to those available from the 2006 Australian census, when the same definition of poverty was used. Various methods of validating the poverty rates have been used, including aggregating the poverty rates to a larger area and comparing them with official Australian Bureau of Statistics estimates from a survey, and applying the spatial microsimulation to larger areas and comparing with official Australian Bureau of Statistics survey results. Both these tests show that the estimates are comparable and fairly robust for most states in Australia.

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In recent months in Australia there has been extended debate about whether the age pension, particularly with regard to single pensioners, is sufficiently high to allow older Australians to attain an acceptable standard of living. This is an important policy consideration given Australia’s rapidly ageing population. By using microdata and microsimulation models, this paper examines the national and spatial impacts on the distribution of poverty among older single people of an increase in the single age‐pension rate. This paper shows that the cost of increasing the single age‐pension to 66 per cent of the couple‐age pension rate would be about $A1.3 billion and would benefit about 824,000 single age‐pensioners. Further, it is estimated that such an increase would reduce poverty rates for lone older persons from 46.5 per cent to 36.5 per cent, a 10‐percentage point reduction. Looking at the spatial distribution of such benefits, the effect of the policy change seems to be generally stronger in capital cities, and in bands of rural areas in New South Wales and Victoria.

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