Policy Research
Indonesia changed its development strategy from an inward-looking import substitution to an outward-looking export orientation in the mid 1980s. Deregulation measures introduced during this period have made the Indonesian economy become more integrated with the world economy. This study examines the impact of a more globally integrated Indonesian economy on its labor market.
Social protection programs are underway to help assist individuals, households, and communities to better manage risk as well as to provide support to the chronically poor. In pre-crisis Indonesia, formal social protection programs hardly existed and most social protection was achieved through informal arrangements.
This paper examines the impact of export orientation, import competition, foreign ownership, and the rate of capital accumulation on the relative demand for skilled and unskilled labor in pre-crisis Indonesia.
Since the late 1980s, minimum wages have become an important plank of the Indonesian government's labour policy. Their levels have increased faster in real terms than those of average wages and per capita gross domestic product and, as a result, minimum wages have become binding for the majority of formal sector workers.
We extend the standard concept of static benefit incidence to dynamic benefit incidence––the relationship between program benefits and changes in household expenditures. Using panel data we compare the static and dynamic benefit incidence of two programs: sales of subsidized rice targeted on administrative criteria and a set of public employment schemes based on self-selection targeting.
