Analysis of Poverty Determinants and Poverty Mitigation Strategies in Aceh Province

Abstract

This research aims to provide empirical evidence on the effect of Direct Spending, Economic Growth, Open Unemployment, Per Capita Expenditure, and the Human Development Index (HDI) on the Poverty Population in Aceh Province. In this study, the author used secondary data and primary data. Secondary data were obtained from the Central Statistics Agency (BPS) and the Ministry of Finance's Directorate General of Budget Year 2010 to 2022. The analytical model used to examine poverty determinants is panel data regression analysis, while SWOT analysis is employed to assess poverty alleviation strategies. Based on the results of model selection tests using the Chow test and the Hausman test, it was determined that the Fixed Effect Model (FEM) is the most suitable model for this research. According to the findings of the Fixed Effect Model (FEM), Direct Spending has a significant negative effect; Economic Growth has a significant positive effect, Open Unemployment has a significant positive effect, Per Capita Expenditure has a significant negative effect, and Human Development Index (HDI) has a significant negative effect on the Poverty Population in Aceh Province. The simultaneous test results (F-test) indicate that Direct Spending, Economic Growth, Open Unemployment, Per Capita Expenditure, and the Human Development Index (HDI) collectively have a simultaneous effect on the Poverty Population in Aceh Province. Meanwhile, based on the SWOT analysis, it was found that the presence of impoverished communities in Aceh Province falls into quadrant 1, with an internal factor value of 0.05 and an external factor of 0.10. Therefore, the required strategy is (S-O Strategy), implying that strengthening internal aspects is the most appropriate choice for poverty alleviation in Aceh Province. Keywords: Poverty, Direct Spending, Economic Growth, Open Unemployment, Per Capita Expenditure, Human Development Index