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Educational development is one of strategic development sectors in order to support country developmentas a whole through human resources capacity enhancement. Education is believed to have substantial contribution in solving many issues encountered by a country such as poverty, unemployment, inequality, as well as economic growth. This research uses data from Indonesian Family Life Survey (IFLS), Bureau of Indonesia Statistics (BPS) and Ministry of Finance of Indonesia in order to estimate educational inequality based on households expenditures on education at individual level by using Gini Coefficient. Additionally, Ordinary Least Squares (OLS) Estimation is utilized to determine the effects of economic and non-economic factors on educational inequality in 470 regencies /cities in Indonesia. The regression result shows that life expectancy, per capita educational expenditures, per capita GRDP and percentage of poor people are negatively correlated with educational inequality. It means that increases in those variables will decrease educational inequality. Rather unexpectedly, government expeditures on education is positively correlated with educational inequality.

Kata Kunci : Educational inequality, government expenditures on education, life expectancy, educational expenditures, GRDP, percentage of poor people