The Impact of Economic Growth on Poverty: Evidence From Regencies in Indonesia

DIDIK SUGENG UTOMO, Yoshiaki Omori; Dr. Dumairy, MA

2021 | Tesis | Magister Ekonomika Pembangunan

Para ekonom telah lama memperdebatkan manfaat pertumbuhan ekonomi terhadap penduduk miskin. Penelitian ini berkontribusi dalam isu ini dengan menganalisis kasus kabupaten/kota di Indonesia menggunakan Ordinary Least Squares (OLS), Feasible Generalized Least Squares (FGLS), dan Difference in Difference Instrumental Variable (DID-IV) atau Two-Stage Least Squares (2SLS). Mengingat pentingkan ketimpangan, seperti disebutkan dalam segitiga pertubuhan-kemiskinan-ketimpangan, studi ini menganalisis 2 jenis pertumbuhan ekonomi (yaitu pertumbuhan ekonomi biasa dan distribution-corrected economic growth). Dengan 2SLS, penelitian ini menemukan bahwa keduanya mengurangi tingkat pertumbuhan kemiskinan, namun efeknya tidak signifikan. Sementara itu, dengan OLS dan FGLS, kedua pertumbuhan tersebut ditemukan meningkatkan kemiskinan. Hasil tersebut menyesatkan karena tidak masuk akal dan berlawanan dengan teori. Karena adanya masalah endogenitas di hubungan pertumbuhan dan kemiskinan, sangat penting untuk menggunakan metode natural experiment dalam menganalisisnya sehingga bisa diperoleh hasil yang tidak menyesatkan. Sesuai hasil DID-IV, penelitian ini mendukung para ekonom pesimis yang berpendapat bahwa pertumbuhan ekonomi tidak mampu untuk trickle-down kepada penduduk miskin. Selain itu, hasil penelitian ini menunjukkan bahwa tidak ada perbedaan yang berarti antara kedua tipe pertumbuhan dalam mempengaruhi kemiskinan.

Economists have debated the benefits of economic growth on poor people for many years. This research contributes to this issue by analyzing the case of Indonesian sub-provincial level data, which is regencies, using Ordinary Least Squares (OLS), Feasible Generalized Least Squares (FGLS), and Difference in Difference Instrumental Variable (DID-IV) or Two-Stage Least Squares (2SLS). Due to the importance of inequality, as mentioned in the growth-poverty-inequality triangle, this study analyzes the effects of ordinary economic growth and distribution-corrected economic growth. Using 2SLS, this research finds that both economic growth and distribution-corrected economic growth reduce the poverty rate growth, but the effects are insignificant. In the meanwhile, using OLS and FGLS, economic growth and distribution-corrected economic growth are found to significantly increase poverty. This result is misleading because it does not make sense and contradicts the theory. Because of the endogeneity of the growth-poverty relationship, it is essential to use natural experiments to analyze the growth-poverty relationship so that the result is not misleading. As 2SLS suggests, this research supports the pessimistic economist who believes that economic growth fails to trickle-down to the poor. In addition, the results illustrate that there is no considerable difference between ordinary economic growth and distribution-corrected economic growth in affecting the poverty rate growth.

Kata Kunci : Poverty, Economic Growth, Distribution-corrected Economic Growth, Inequality, Endogeneity