ESTIMATING THE IMPACT OF SOCIAL AND ECONOMIC FACTORS ON INCOME INEQUALITY IN INDONESIA

Lili Indriyani,Reska Tri Resmawati,Sugeng Setyadi

doi:10.24843/bse.2022.v27.i01.p06

Lili Indriyani, Reska Tri Resmawati + Show 1 more

Open Access

https://doi.org/10.24843/bse.2022.v27.i01.p06

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Abstract

The motivation of this research comes from United Nations Sustainable Development Goals (UN-SDGs) and their impacts by 2030. The UN highlighted 17 SDGs that address relevant local and global issues, one of which is the 10th SDG goal of reducing inequality. This study aims to determine the effect of the Human Development Index, GDP per capita, foreign investment, national investment and average years of schooling on income inequality in Indonesia during the period 2010 to 2020. This study uses panel data regression analysis, with research data that obtained from publications provided by Central Bureau of Statistics. The results showed that the Human Development Index variable and Mean Years of Schooling negative and significant effect on income inequality. This shows that the Human Development Index and mean years of schooling can reduce income inequality in Indonesia.

Highlights

In the process of economic development in a region, a common problem or often arises from a development point of view is regional inequality
The purpose of this study is to analyze whether there is an effect of the Human Development Index, poverty rate, GDP per capita, unemployment rate, foreign investment, domestic investment and the ratio of the average school to income inequality in Indonesia in 2010 to 2020
This study aims to analyze income inequality to achieve the Sustainable Development Goals (SDGs) in Indonesia in 2010-2020

Summary

Introduction

In the process of economic development in a region, a common problem or often arises from a development point of view is regional inequality This is due to the phenomenon of differences in each region such as the content of natural resources and demographic conditions, so that with these differences the possibility of encouraging the process of economic development in an area will vary (Sjafrizal, 2008).)With the variation in production factors and the availability of resources in each region, it is not surprising that there are developed and lagging regions in each region.

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