Economic Growth in Indonesia: Dynamics of Poverty, Unemployment, and Health Budgets
Abstract
Even with Indonesia's impressive recent economic expansion, issues including poverty, unemployment, health care spending, housing, education, and labor productivity continue to be serious problems. International organization databases, government reports, academic publications, national statistics agencies, and academic publications are some of the sources that can be used for secondary quantitative data analysis encompassing 34 provinces from 2018 to 2022. The results show that unemployment, poverty all have a detrimental effect on economic growth. On the other hand health budget allocations all have a favorable impact. The study concludes that while investments in health budgets positively influence growth by enhancing human capital and, poverty, unemployment negatively impact economic growth. This study's conclusion about the correlation between the variables can offer insightful information to practitioners across a range of fields and public policy.
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References
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Kluve, J., Puerto, S., Robalino, D., Romero, J. M., Rother, F., Stöterau, J., … Witte, M. (2019). Do youth employment programs improve labor market outcomes? A quantitative review. World Development, 114, 237–253. https://doi.org/10.1016/j.worlddev.2018.10.004
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Marquez-Ramos, L., & Mourelle, E. (2019). Education and economic growth: an empirical analysis of nonlinearities. Applied Economic Analysis, 27(79), 21–45. https://doi.org/10.1108/AEA-06-2019-0005
Miller, N., Peng, L., & Sklarz, M. (2011). House Prices and Economic Growth. Journal of Real Estate Finance and Economics, 42(4), 522–541. https://doi.org/10.1007/s11146-009-9197-8
Nakamura, K., Kaihatsu, S., & Yagi, T. (2019). Productivity improvement and economic growth: lessons from Japan. Economic Analysis and Policy, 62, 57–79. https://doi.org/10.1016/j.eap.2018.11.002
Ng, C. P., Law, T. H., Jakarni, F. M., & Kulanthayan, S. (2019). Road infrastructure development and economic growth. IOP Conference Series: Materials Science and Engineering, 512(1). https://doi.org/10.1088/1757-899X/512/1/012045
Ngubane, M. Z., Mndebele, S., & Kaseeram, I. (2023). Economic growth, unemployment and poverty: Linear and non-linear evidence from South Africa. Heliyon, 9(10), e20267. https://doi.org/10.1016/j.heliyon.2023.e20267
Ngutsav, A. S., & Ijırshar, V. U. (2018). Labour Productivity and Economic Growth In Nigeria: A Disaggregated Sector Analysis. Lafia Journal of Economics and Management Sciences, 3(1).
Okunlola, O. C., Sani, I. U., & Ayetigbo, O. A. (2023). Socio-economic governance and economic growth in Nigeria. Journal of Business and Socio-Economic Development. https://doi.org/10.1108/jbsed-03-2023-0019
Olga, B., & Antonios, R. (2019). Housing Construction as a Leading Economic Indicator. Studies in Business and Economics, 14(3), 33–49. https://doi.org/10.2478/sbe-2019-0041
Peña-Sánchez, A. R., Ruiz-Chico, J., & Jiménez-García, M. (2021). Dynamics of public spending on health and socio-economic development in the european union: An analysis from the perspective of the sustainable development goals. Healthcare (Switzerland), 9(3). https://doi.org/10.3390/healthcare9030353
Rachman, S. N., Suharno, S., & Badriah, L. S. (2020). The Crucial Factors Affecting Poverty and Inequality in ASEAN: A Case Study of Cambodia, Malaysia, Indonesia, and Thailand. Icore, 5(1).
Rafia, R. (2021). Economics and Public Health. In The Journal of the Royal Society for the Promotion of Health (Vol. 42). SHINEEKS Publishers. https://doi.org/10.1177/146642402104200516
Razia, A., Omarya, M., Razia, B., Awwad, B., & Ruzieh, A. (2023). Examining how unemployment, inflation and their related aspects affected economic growth in Palestine: The period from 1991 to 2020. Heliyon, 9(11), e21081. https://doi.org/10.1016/j.heliyon.2023.e21081
Rosman, D. A., & Apfeld, J. C. (2013). The economics of health care. In An Introduction to Health Policy: A Primer for Physicians and Medical Students (Vol. 9781461477). https://doi.org/10.1007/978-1-4614-7735-8_11
Rusdianti, I. S., & Ainun, S. N. (2024). Analysis Of Labor Figures Unemployment In Malang City And Factors Affecting. 7(1), 49–58.
Sabur, A., Khusaini, K., & Ramdani, H. C. (2021). Education Equality and Economic Growth in Indonesia. Jejak, 14(1), 167–182. https://doi.org/10.15294/jejak.v14i1.26162
Sánchez-Cañizares, S. M., Cabeza-Ramírez, L. J., & Guerrero-Baena, M. D. (2020). Evaluation of self-employment support policies using survival analysis. The discounted flat rate in Andalusia (Spain). Papers in Regional Science, 99(5), 1389–1411. https://doi.org/10.1111/pirs.12533
Shyamsundar, P., Sauls, L. A., Cheek, J. Z., Sullivan-Wiley, K., Erbaugh, J. T., & Krishnapriya, P. P. (2021). Global forces of change: Implications for forest-poverty dynamics. Forest Policy and Economics, 133, 102607. https://doi.org/10.1016/j.forpol.2021.102607
Suharno, S., & Anwar, N. (2023). The Energy Demand Elasticity in Relation to Gross Domestic Product in Indonesia: Sectoral Approach. International Journal of Energy Economics and Policy, 13(4), 634–640. https://doi.org/10.32479/ijeep.13385
Tran, N. Van, Alauddin, M., & Tran, Q. Van. (2019). Labour quality and benefits reaped from global economic integration: An application of dynamic panel SGMM estimators. Economic Analysis and Policy, 63, 92–106. https://doi.org/10.1016/j.eap.2019.04.014
Ubogu, R. (2022). Quality Education : a Strategic Tool for Human Capital. (June).
Unsw, D. M. (2021). Housing in the Economy : Scale , Cycles and Stability.
Wang, B., Shi, H., Wang, Z., Xu, S., Deng, N., Qiu, Y. (Lucy), & Zhang, B. (2023). Pandemics erode poverty alleviation process: Impact on productive livelihood and poverty return. IScience, 26(10), 107177. https://doi.org/10.1016/j.isci.2023.107177
Xiang, L., Tang, M., Yin, Z., Zheng, M., & Lu, S. (2021). The COVID-19 Pandemic and Economic Growth: Theory and Simulation. Frontiers in Public Health, 9(September), 1–14. https://doi.org/10.3389/fpubh.2021.741525
Read More
Anna, V. (2021). Education and Economic Growth. International Encyclopedia of Education, Third Edition, (17), 245–252. https://doi.org/10.1016/B978-0-08-044894-7.01227-6
Bala, U., Ibrahim, A., & Bala Hadith, N. (2020). Impact of Population Growth, Poverty and Unemployment on Economic Growth. Asian Business Research Journal, 5(November), 48–54. https://doi.org/10.20448/journal.518.2020.5.48.54
Bertay, A. C., Dordevic, L., & Sever, C. (2021). Gender Inequality and Economic Growth: Evidence from Industry-Level Data. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3658594
Brkić, I. (2020). The relationship between economic freedom and economic growth in EU countries. (June), 1–165. Retrieved from https://www.tdx.cat/bitstream/handle/10803/669302/2020_Tesis_ Brkic_Ivana.pdf?sequence=1
Chen, F., & Chen, Z. (2021). Cost of economic growth: Air pollution and health expenditure. Science of the Total Environment, 755, 142543. https://doi.org/10.1016/j.scitotenv.2020.142543
Chen, S., Kuhn, M., Prettner, K., Bloom, D. E., & Wang, C. (2021). Macro-level efficiency of health expenditure: Estimates for 15 major economies. Social Science and Medicine, 287(July), 114270. https://doi.org/10.1016/j.socscimed.2021.114270
Cylus, J., Normand, C., & Figueras, J. (2019). The economics of healthy and active ageing series will population ageing spell the end of the of the welfare state?: A review of evidence and policy options. 1–43.
Edwards, M. G. (2021). The growth paradox, sustainable development, and business strategy. Business Strategy and the Environment, 30(7), 3079–3094. https://doi.org/10.1002/bse.2790
European Training Foundation. (2021). Algeria Education, Training and Employment Developments 2021. 6.
Gao, Z., Sockin, M., & Xiong, W. (2020). Economic consequences of housing speculation. Review of Financial Studies, 33(11), 5248–5287. https://doi.org/10.1093/RFS/HHAA030
Graham, L. (2020). Differences in employment and income poverty between people with and without disabilities in South Africa. Alter, 14(4), 299–317. https://doi.org/10.1016/j.alter.2020.06.011
Hanushek, E. A., & Wößmann, L. (2009). Education and Economic Growth. International Encyclopedia of Education, Third Edition, (September), 245–252. https://doi.org/10.1016/B978-0-08-044894-7.01227-6
Hensher, M., Canny, B., Zimitat, C., Campbell, J., & Palmer, A. (2020). Health care, overconsumption and uneconomic growth: A conceptual framework. Social Science and Medicine, 266(September), 113420. https://doi.org/10.1016/j.socscimed.2020.113420
Hooi, H. L. (2023). The Dynamics of Multidimensional Educational Poverty Azaz. Journal Pre Proof, 8(1), 127571. https://doi.org/10.1016/j.dsm.2024.03.004
Husen, M. S. M. S. (2019). Economic Growth and Human Capital. International Journal of Trend in Scientific Research and Development, Volume-3(Issue-4), 190–192. https://doi.org/10.31142/ijtsrd23628
Husin, N. A. (2021). Unemployment Crisis Among Fresh Graduates. American International Journal of Social Science Research, (November), 1–14. https://doi.org/10.46281/aijssr.v10i1.1461
Huu, A. T., Nhat, T. T., Thanh, T. C. T., & Ho, G. L. (2022). The reason why the unemployment rate of college graduates is increasing: Case study in Ho Chi Minh City, Vietnam. International Journal of Multidisciplinary Research and Development, 9(1), 19–25. Retrieved from www.allsubjectjournal.com
Isham, A., Mair, S., & Jackson, T. (2021). Worker wellbeing and productivity in advanced economies: Re-examining the link. Ecological Economics, 184(February), 106989. https://doi.org/10.1016/j.ecolecon.2021.106989
Jaax, A. (2020). Private sector development and provincial patterns of poverty: Evidence from Vietnam. World Development, 127, 104747. https://doi.org/10.1016/j.worlddev.2019.104747
Kluve, J., Puerto, S., Robalino, D., Romero, J. M., Rother, F., Stöterau, J., … Witte, M. (2019). Do youth employment programs improve labor market outcomes? A quantitative review. World Development, 114, 237–253. https://doi.org/10.1016/j.worlddev.2018.10.004
Ku Abd Rahim, K. N., Kamaruzaman, H. F., Dahlui, M., & Wan Puteh, S. E. (2020). From Evidence to Policy: Economic Evaluations of Healthcare in Malaysia - A Systematic Review. Value in Health Regional Issues, 21, 91–99. https://doi.org/10.1016/j.vhri.2019.09.002
Marquez-Ramos, L., & Mourelle, E. (2019). Education and economic growth: an empirical analysis of nonlinearities. Applied Economic Analysis, 27(79), 21–45. https://doi.org/10.1108/AEA-06-2019-0005
Miller, N., Peng, L., & Sklarz, M. (2011). House Prices and Economic Growth. Journal of Real Estate Finance and Economics, 42(4), 522–541. https://doi.org/10.1007/s11146-009-9197-8
Nakamura, K., Kaihatsu, S., & Yagi, T. (2019). Productivity improvement and economic growth: lessons from Japan. Economic Analysis and Policy, 62, 57–79. https://doi.org/10.1016/j.eap.2018.11.002
Ng, C. P., Law, T. H., Jakarni, F. M., & Kulanthayan, S. (2019). Road infrastructure development and economic growth. IOP Conference Series: Materials Science and Engineering, 512(1). https://doi.org/10.1088/1757-899X/512/1/012045
Ngubane, M. Z., Mndebele, S., & Kaseeram, I. (2023). Economic growth, unemployment and poverty: Linear and non-linear evidence from South Africa. Heliyon, 9(10), e20267. https://doi.org/10.1016/j.heliyon.2023.e20267
Ngutsav, A. S., & Ijırshar, V. U. (2018). Labour Productivity and Economic Growth In Nigeria: A Disaggregated Sector Analysis. Lafia Journal of Economics and Management Sciences, 3(1).
Okunlola, O. C., Sani, I. U., & Ayetigbo, O. A. (2023). Socio-economic governance and economic growth in Nigeria. Journal of Business and Socio-Economic Development. https://doi.org/10.1108/jbsed-03-2023-0019
Olga, B., & Antonios, R. (2019). Housing Construction as a Leading Economic Indicator. Studies in Business and Economics, 14(3), 33–49. https://doi.org/10.2478/sbe-2019-0041
Peña-Sánchez, A. R., Ruiz-Chico, J., & Jiménez-García, M. (2021). Dynamics of public spending on health and socio-economic development in the european union: An analysis from the perspective of the sustainable development goals. Healthcare (Switzerland), 9(3). https://doi.org/10.3390/healthcare9030353
Rachman, S. N., Suharno, S., & Badriah, L. S. (2020). The Crucial Factors Affecting Poverty and Inequality in ASEAN: A Case Study of Cambodia, Malaysia, Indonesia, and Thailand. Icore, 5(1).
Rafia, R. (2021). Economics and Public Health. In The Journal of the Royal Society for the Promotion of Health (Vol. 42). SHINEEKS Publishers. https://doi.org/10.1177/146642402104200516
Razia, A., Omarya, M., Razia, B., Awwad, B., & Ruzieh, A. (2023). Examining how unemployment, inflation and their related aspects affected economic growth in Palestine: The period from 1991 to 2020. Heliyon, 9(11), e21081. https://doi.org/10.1016/j.heliyon.2023.e21081
Rosman, D. A., & Apfeld, J. C. (2013). The economics of health care. In An Introduction to Health Policy: A Primer for Physicians and Medical Students (Vol. 9781461477). https://doi.org/10.1007/978-1-4614-7735-8_11
Rusdianti, I. S., & Ainun, S. N. (2024). Analysis Of Labor Figures Unemployment In Malang City And Factors Affecting. 7(1), 49–58.
Sabur, A., Khusaini, K., & Ramdani, H. C. (2021). Education Equality and Economic Growth in Indonesia. Jejak, 14(1), 167–182. https://doi.org/10.15294/jejak.v14i1.26162
Sánchez-Cañizares, S. M., Cabeza-Ramírez, L. J., & Guerrero-Baena, M. D. (2020). Evaluation of self-employment support policies using survival analysis. The discounted flat rate in Andalusia (Spain). Papers in Regional Science, 99(5), 1389–1411. https://doi.org/10.1111/pirs.12533
Shyamsundar, P., Sauls, L. A., Cheek, J. Z., Sullivan-Wiley, K., Erbaugh, J. T., & Krishnapriya, P. P. (2021). Global forces of change: Implications for forest-poverty dynamics. Forest Policy and Economics, 133, 102607. https://doi.org/10.1016/j.forpol.2021.102607
Suharno, S., & Anwar, N. (2023). The Energy Demand Elasticity in Relation to Gross Domestic Product in Indonesia: Sectoral Approach. International Journal of Energy Economics and Policy, 13(4), 634–640. https://doi.org/10.32479/ijeep.13385
Tran, N. Van, Alauddin, M., & Tran, Q. Van. (2019). Labour quality and benefits reaped from global economic integration: An application of dynamic panel SGMM estimators. Economic Analysis and Policy, 63, 92–106. https://doi.org/10.1016/j.eap.2019.04.014
Ubogu, R. (2022). Quality Education : a Strategic Tool for Human Capital. (June).
Unsw, D. M. (2021). Housing in the Economy : Scale , Cycles and Stability.
Wang, B., Shi, H., Wang, Z., Xu, S., Deng, N., Qiu, Y. (Lucy), & Zhang, B. (2023). Pandemics erode poverty alleviation process: Impact on productive livelihood and poverty return. IScience, 26(10), 107177. https://doi.org/10.1016/j.isci.2023.107177
Xiang, L., Tang, M., Yin, Z., Zheng, M., & Lu, S. (2021). The COVID-19 Pandemic and Economic Growth: Theory and Simulation. Frontiers in Public Health, 9(September), 1–14. https://doi.org/10.3389/fpubh.2021.741525
Authors
Sulaeman, M., Suharno, S., & Ahmad, A. A. (2024). Economic Growth in Indonesia: Dynamics of Poverty, Unemployment, and Health Budgets. Agregat: Jurnal Ekonomi Dan Bisnis, 8(2), 179–198. https://doi.org/10.22236/agregat_vol8.i2/16418
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