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In a fast urbanizing Indonesia, the rural sector still plays an important role in the country’s economy. Although declining, the majority of the population still live and find employment in rural areas. However, rural areas lag behind urban areas in many aspects. As a result, around 80% of all the poor in the country are found in rural areas.
This study extends the literature on the relationship between economic growth and poverty reduction by differentiating growth and poverty into their sectoral compositions and locations. We find that growth in the rural services sector reduces poverty in all sectors and locations. However, in terms of elasticity of poverty, urban services growth has the largest for all sectors except urban agriculture.
In this study we investigate the causes of low secondary school enrollment in Indonesia despite near universal primary school attendance. We then find that attrition during the transition between primary and junior secondary education levels is the main cause. We investigate the causes of attrition using a longitudinal household survey dataset.
Most of the unemployed in Indonesia are young and inexperienced, still live with their parents, and have at least 12 years of education. Starting with the premise that efforts to reduce unemployment should take into account the characteristics of the unemployed, we develop a model to look at the impact of different sectors and locations of economic growth on urban, rural, and national employment using a provincial level panel dataset.
This paper assesses the effect of public and private sector growth on poverty in Indonesia. We use fixed capital formation growth as the proxy for the private sector and growth in government spending as the indicator of the public sector. We find that growth in both sectors significantly reduces poverty; moreover, they have the same elasticity.
