An analysis of poverty in Central Java evidence in 1996, and 2002

WINARNI, Widya Ayu,

2008 | Tesis | S2 Magister Ekonomika Pembangunan

This thesis examines the incidence of poverty in Central Java in the period from 1996 to 2002. Susenas expenditure data in 1996, 1999 and 2002 were used to measure the incidence of poverty based on the Foster, Greer, and Thorbeckce (FGT) index. Using the decomposition formula developed by Huppi and Ravallion (1991a, 1991b), this thesis also investigates the effects of urban and rural poverty on the change in overall poverty. The incidence of poverty was higher in rural than that of urban areas before the economic crisis. However, the urban poverty has worsened more significantly than the rural poverty after the crisis, as indicated by the higher headcount and poverty gap index in 1999. Spatially, poor people were distributed unevenly across districts. There were two major clusters of poor districts: one in the eastern part and the other in the middle part of Central Java. One of the policy implications from our analysis is that poverty reduction programs seem to be more effective if they are targeting the poor in specific location. Poverty reduction programs should be targeted both on rural and urban poor people with specific policy measures and instruments between the rural and urban sectors. Since economic growth is found to be very effective in reducing poverty in both rural and urban areas, growth promoting policies in general should be conducive to alleviating poverty across the country.

Kata Kunci : Poverty analysis,Evidence,Central Java