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After more than three decades under a centralized national government, Indonesia decided to implement a new policy of regional autonomy that became effective on January 1, 2001. This paper examines both the preparations for and the initial implementation of autonomy in the regions, as well as some of the conducted in fourteen districts across eleven provinces over to the last two years.


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This study provides evidence about changes in the distribution of living standards among Indonesian households during the economic crisis. It uses consumption expenditure data from a panel of households that were surveyed in May 1997, just before the onset of the crisis, and then again in August 1998, about a year after the crisis began.


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Even in August 1998, one year into Indonesia’s economic crisis, there were still no new nationally representative data on its social impact.


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This study is the first attempt to systematically examine the impact of bad governance practices in Indonesia on poverty reduction. Indonesia is a country that has endured bad governance for a long period, but has also sustained significant poverty reduction.


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Infrastructures play a crucial role in economic development and poverty reduction. The economic crisis in 1997-98 severely curtailed the government’s capacity to maintain the existing infrastructures, which could adversely affect the prospects for future economic development and poverty reduction in the country.


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