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Jurnal Ekonomi Pembangunan : Kajian Masalah Ekonomi dan Pembangunan
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This is an Open Access Journal

Open Access journal
ISSN (Print) 1411-6081 - ISSN (Online) 2460-9331
Published by Universitas Muhammadiyah Surakarta

[33 journals]

The Effect of Taste on Papuan Local Consumption
- Authors: Panni Genti Romauli Pardede, Aris Ananta
  Pages: 155 - 169
  Abstract: This study aims to determine the effect of tastes on local food consumption in an econometric analysis of the food demand structure in Papua Province. This study used the 2019 National Social and Economic Survey (SUSENAS) with 13.151 households conducted by Statistics Indonesia (BPS). The method used is Quadratic Almost Ideal Demand System (QUAIDS) with Iterated Linear Least Square (ILLS) estimator. The results show that education, household size, location, age, the job of the head of the household, and income group affect local food consumption. When urbanization, education, and income increase, they tend to reduce local food consumption and shift food choices from local food because it is difficult to obtain. The influence of taste from the socio-demographic side has different taste factors between urban and rural. Therefore, the government needs to increase understanding through education about food diversity and good nutrition because local food has a higher nutritional content than rice or other foods. In addition, it is necessary to increase the horizontal diversification of local food, provision a market for local-food distribution, and increase income because the economic condition in Papua is still low, so they are vulnerable to food security.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.19081
  Issue No: Vol. 23, No. 2 (2022)
Business Capital Funding Through the Financial Sector to Reduce
Unemployment in Indonesia
- Authors: Bagus Kusuma, Ainnatul Muthmainnah
  Pages: 170 - 178
  Abstract: This research aimed to study the role of the financial sector and foreign investment in increasing domestic production output. Where the increase in production output will increase the factors of production, one of which is labor. The data used in this study are annual time series data from the 2004 to 2021, and this study employed the Error Correction Model (ECM) approach to estimate the short-term effect and OLS to determine the long-term effect. The results showed that funding growth through the financial sector to the industrial sector in Indonesia has grown consistently since 2004 which has continued to encourage improved economic performance after the 1998 crisis. There is also a relationship between financial variables and fiscal policy on unemployment in both the short and long term. There are several ways to deal with unemployment both in the long term and in the short term, such as when an economic slowdown occurs. By increasing FDI, bank credit and funding in the the capital market, the private sector can continue to expand its business. This private expansion phase will increase the output of goods or services. With the increase in production output, employment will continue to be positive.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.18157
  Issue No: Vol. 23, No. 2 (2022)
Internet Use and Agricultural Household Food Insecurity in Indonesia
- Authors: Dela Maria Ardianti, Djoni Hartono
  Pages: 179 - 191
  Abstract: Food is an essential aspect of human life, but there are still households that experienced food insecurity. It caused a major challenge for policymakers to reduce food insecurity, especially at a household level. This study aims to analyze the association between internet use and food insecurity of agricultural households in Indonesia. This study uses the National Socio Economic Survey or Survei Sosial Ekonomi Nasional (Susenas) 2018 data. The food insecurity variable is measured by using the food insecurity experience scale (FIES) and internet use is a binary variable. Estimation of the impact of internet use on food insecurity uses Ordinary Least Square (OLS) regression. The result of this study indicates that internet use has a negative effect on agricultural household food insecurity. It means that internet use can reduce food insecurity in agricultural households. The policy implication directed to the government can improve the quality of internet infrastructure and improve content as positive information for the user, especially in the agricultural sector.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.18077
  Issue No: Vol. 23, No. 2 (2022)
The Nexus Between Health and Economic Growth: Empirical Evidence from
Indonesia
- Authors: Mochammad Yusuf, Avi Budi Setiawan
  Pages: 192 - 210
  Abstract: The controversial debate about the relationship between health and economic growth nexus has become one of the most contentious issues in the last two decades of scientific development. The inconsistency of research results that occur makes this hypothesis very interesting to study, especially in developing countries such as Indonesia. This study aims to determine the relationship between health variables such as healthcare expenditure, human development index, life expectancy, and mortality on economic growth with the Indonesian case study as the object of analysis. This study uses secondary data from Indonesia in the period 1985-2021 using the Engle-Granger Error Correction Model and Granger Causality. Based on the estimation of the Engle-Granger Error Correction Model, both in the long term and in the short term, all health variables have a significant influence on economic growth. To prove the causal relationship between health variables and economic growth, a causality granger analysis was used, it was found that healthcare expenditure had a causal (bidirectional) relationship with economic growth. Another causal relationship is also found in the human development index, the rest there is a unidirectional relationship between mortality and economic growth. This finding proved that health plays a crucial role on economic growth. Therefore, the government must be able to take several policies to improve the quality of public health including: prioritize development budget allocations for health infrastructure, implementing cash-transfer and health subsidies program to reduce cost-barriers that limiting healthcare access of poor people.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.20018
  Issue No: Vol. 23, No. 2 (2022)
The Effect of Spillover Foreign Direct Investment on Labor Productivity in
Indonesia
- Authors: Krismanti Tri Wahyuni, Anugerah Karta Monika, Robert Kurniawan, Rezzy Eko Caraka, Yoga Dwi Nugroho
  Pages: 211 - 228
  Abstract: The contribution of the manufacturing sector to Indonesia’s GDP reaches more than 20 percent. However, Indonesia has challenges to increase the productivity of workers who work in the industrial sector. The Omnibus law requires the assistance of foreign workers to work in Indonesia so that technology and expertise transfer happen. Foreign workers are believed to have a spillover effect in the form of skills and technology transfer through Foreign Direct Investment (FDI). FDI in the manufacturing sector allows an increase in labor productivity as a result of the spillover effect in the form of the transfer of skills and technology. This study aims to examine the impact of FDI spillover by making a comparison between labor productivity in companies whose ownership is dominated by foreign and domestic. Using data used from a large medium industry survey in 2010-2014. The method used in this research is panel data regression analysis with a cross-section of 28 industry subcategories derived from ISIC and a 5-year time series from 2010-2014, when the manufacturing sector became a source of growth in Indonesia of more than one percent. The results are in general FDI has a positive effect on labor productivity in companies whose ownership is dominated by foreign and domestic ownership. Meanwhile, FDI spillovers on labor productivity did not occur in companies whose ownership was dominated by domestic but occurred in companies whose ownership was dominated by foreigners.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.18060
  Issue No: Vol. 23, No. 2 (2022)
Measuring Spatial Disparity in East Java: A Convergence Analysis
- Authors: Rachmad Kresna Sakti, Aura Vedareni Maudita
  Pages: 229 - 240
  Abstract: The development paradigm of development continues to evolve, not only focusing on growth, but also on equity. This study aims to analyze the spatial inequality of economic growth in the districts/ cities of East Java in 2016-2020 using convergence analysis. We use GDP per capita in the t-1 period, the industrial agglomeration index, regional investment, education index, health index, and capital expenditure to determine the magnitude of their influence on the creation of convergence or divergence on growth. economy in East Java. Based on the absolute and conditional convergence analysis that has been carried out, it can be seen if economic growth in 2016-2020 experiences spatial divergence or inequality. The industrial concentration index variable has a significant and negative effect on the formation of spatial inequality in East Java, this means that industrial concentration reduces the growth rate and contributes to the formation of spatial inequality in East Java. In addition, the variables of investment, education index, health index, and capital expenditure alone do not have a significant influence on the formation of spatial inequality in East Java.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.15452
  Issue No: Vol. 23, No. 2 (2022)
Technical Inefficiency in Nine Clusters of Indonesian Manufacturing Firms
And its Determinants: Stochastic Frontier Analysis
- Authors: Theresya Jeini Astanto, Suyanto - Suyanto, Henrycus Winarto Santoso, Ruhul Salim
  Pages: 241 - 253
  Abstract: The current study examines the technical inefficiency of Indonesian manufacturing firms and its key determinants. Extending the previous research that mainly focuses on firms in a specific industry, the current study groups firms into nine industrial clusters and estimates them separately to find a variety of results among the clusters. The stochastic frontier analysis (SFA) method is applied to estimate the inefficiency score and the key determinants of 5,848 firms for five years (29,240 total observations). Data period ended in 2014 due to the substantial change in the classification code of the manufacturing industry in the survey by the Indonesian Central Board of Statistics. Five notable findings are recorded. First, the average efficiency score of all observed firms is 0.8815. Second, firm size is found to have a negative effect on inefficiency in the sample of all firms and three out of nine clusters (ISIC 34, ISIC 35, and ISIC 37). Third, foreign ownership generates a negative contribution to firms’ technical inefficiency in both the sample of all firms and the sample of each nine industrial clusters. Fourth, export orientation has various effects on firms across nine industrial clusters, with a dominant significant negative impact in paper and paper product industry (ISIC 34) and metal product industry (ISIC 38). Finally, import intensity provides a significant negative impact on firms in most industrial clusters. These findings support the argument on the importance of absorption capacity and unique firm characteristics in analyzing the impact of key determinants of technical inefficiency.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.18113
  Issue No: Vol. 23, No. 2 (2022)
Investigating The Determinants of Islamic Bank’s Profitability: A
Cross Countries Analysis
- Authors: Rindang Nuri Isnaini Nugrohowati, Muhammad Hamdan Syafieq bin Ahmad, Faaza Fakhrunnas
  Pages: 254 - 268
  Abstract: The measurement of bank profitability has an essential role in the banking sector’s success and is an indicator for predicting financial distress. This study aims to look at the determinants of the profitability of Islamic banks by including the bank’s internal and macroeconomic variables. The study focuses on Islamic banking in 10 countries with the most prominent Islamic finance sector during the 4th quarterly data period from 2016 to the 4th quarter of 2021. The data analysis method in this study uses panel data fixed effect model analysis. The results showed that the bank’s internal variables, namely bank size, capital adequacy, liquidity, and banking stability, are important factors that affect profitability. Interesting findings show that increased financial inclusion variables and labor productivity can encourage high profitability growth. Meanwhile, GDP and inflation also affect banking performance from the macro sector. The study implies that Islamic bank needs to manage the internal financial condition properly to achieve and maintain the performance. In addition, to increase the performance the bank needs to heighten the human resources capacity while the financial authorities are required to issue the policies to support the development of Islamic banks.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.20409
  Issue No: Vol. 23, No. 2 (2022)
How Capital, Labor, and Technology Influence Java’s Economic Growth
- Authors: Sotya Fevriera, Sefira Archintia, Virgiana Nugransih Siwi
  Pages: 269 - 282
  Abstract: Indonesia is a developing country with a relatively stable economy, as can be seen in Indonesia’s real GDP per capita, which tends to increase before the Covid-19 pandemic. However, there is a disparity in economic growth between Java and outside Java. During the 2010-2020 period, Java’s economic growth reached 61.9%, while outside Java was only 48.5%. According to the Solow Model theory, three factors can influence economic growth: capital, labor, and technology. Therefore, this study aims to determine the effect of capital, labor, and technology on economic growth in Java. This research was conducted using two approaches, namely generalized least square (GLS) and mixed-effect regression model (MEM). Both methods show the same result that capital and labor have a significant positive effect on the real GRDP of the provinces in Java. In contrast, technology has an insignificant effect on the real GRDP of the provinces in Java. This study also found significant random effects among provinces in Java for the number of workers and capital, but not on technology.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.18278
  Issue No: Vol. 23, No. 2 (2022)
Does Health Contribute to Economic Growth' An Evidence from Regional
Levels in Indonesia
- Authors: Vita Kartika Sari, Malik Cahyadin, Aranka Ignasiak-Szulc
  Pages: 283 - 294
  Abstract: Health can lead economic development in many countries. The higher the quality of health, the more space for increasing economic growth and providing prosperity in the long-run. The current study attempts to estimate the effect of health on regional economic growth in Indonesia. Balanced panel data is set covering 34 provinces from 2015 to 2020. The panel data is estimated using system Generalized Method of Moments (GMM). The findings reveal that smoking level contributes significantly and positively on regional economic growth, while health service has no effect. The non-linear impact of smoking level on regional economic growth is U-shaped. It means that higher smoking level stimulates regional economic growth by the increasing of aggregate spending. The local governments should design health service program and control smoking level properly so that the health risk of cigarette consumption does not offset its benefit to the economy. The policy design will produce better human health and life in all provinces in Indonesia. Consequently, the regional economic growth can be achieved in the long-run.
  PubDate: 2022-12-31
  DOI: 10.23917/jep.v23i2.20106
  Issue No: Vol. 23, No. 2 (2022)