Infrastructure, economic growth and inequality in Indonesia land borders

Abstract

The purpose of this study is to analyze the impacts of infrastructure on economic growth and inequality in Indonesia land borders. Using static panel data regression and panel two stage least square (2SLS) estimation methods, this study shows that social infrastructure can raise per capita income. The social infrastructures being discussed are number of high schools and number of health facilities. Telecommunication facility can also raise per capita income. In addition, income inequality is found to be positively influenced by income per capita growth and industry sector laborer. It also suggests that infrastructure has indirect relation with income inequality through per capita income.Keywords: Land borders, infrastructure, economic growth, inequality JEL classification numbers: C23, C36, O15, O40, O53, I30, R11 DOI: http://dx.doi.org/10.20885/ejem.vol5.iss2.art3 Abstrak Tujuan penelitian ini adalah untuk menganalisis dampak infrastruktur terhadap pertumbuhan ekonomi dan ketimpangan di perbatasan darat Indonesia. Menggunakan metode estimasi regresi data panel statis dan panel two stage least square ( 2SLS), penelitian ini menunjukkan bahwa infrastruktur sosial dapat meningkatkan pendapatan per kapita. Infrastruktur sosial yang dibahas adalah jumlah sekolah tinggi dan jumlah fasilitas kesehatan. Fasilitas telekomunikasi juga dapat meningkatkan pendapatan per kapita. Selain itu, ketimpangan pendapatan ditemukan secara positif dipengaruhi oleh pertumbuhan pendapatan perkapita dan buruh sektor industri. Paper ini juga menunjukkan bahwa infrastruktur memiliki hubungan tidak langsung dengan ketimpangan pendapatan melalui pendapatan per kapita.

The Determinants of Inclusive Economic Growth in Yogyakarta

“…The district/city minimum wages coefficient value of 0.121419 means that a 1% increase in district/city minimum wages will increase income inequality by 0.121419% with the assumption of ceteris paribus. This is in line with the research by Prasetyo et al (2013) and Sungkar et al (2015) where an increase in labor income in the industrial sector (formal) will increase inequality. The increase in income in the formal sector causes the difference in labor income between the industrial sector (formal) and the agricultural sector to widen, so that this will lead to income inequality in society.…”

The Impact of Regional Autonomy and Monetary Crisis on Economic Growth in Yogyakarta

“…In these conditions, the labor force would trigger unemployment, which in turn lowers economic growth. However, these results are consistent with the results of Prasetyo et al (2013) who found that the investments do not affect the economic growth of DIY. Presumably it is because investment in YST is dominated by small industries.…”

“…Fan et al (2011) state three strategies to disperse fairly economic growth to regions namely (a) infrastructure, (b) social investment and protection and (c) government reform. Additionally, economic growth depends on investment purchase of infrastructure (Prasetyo et al, 2013). The availability and quality of infrastructure financed by government or private investment are keys of economic progress affecting the Indonesian national economic growth (Ferdinan, 2013).…”

Peran Pembangunan Infrastruktur terhadap Ketimpangan Ekonomi Antarwilayah di Indonesia

“…Sementara itu Makmuri (2017) menemukan bahwa ketidakseimbangan jumlah infrastruktur jalan dan telekomunikasi cenderung meningkatkan ketimpangan pendapatan antarwilayah di Indonesia. Penelitian Prasetyo et al, (2013) menunjukkan bahwa infrastruktur memiliki hubungan tidak langsung dengan ketimpangan pendapatan melalui pendapatan per kapita. Fakta ini sesuai dengan hasil penelitian ini yang menjelaskan bahwa pembangunan infrastruktur provinsi di Indonesia seperti irigasi, jalan, dan air bersih berkaitan erat dengan perkembangan ekonomi yang terjadi pada provinsi tersebut.…”