Abstract
Income distribution is one of the important factors determining the effectiveness of growth in reducing poverty. This study examines the factors determining income distribution in Indonesia. The results of econometric analysis show that income distribution in Indonesia strongly affected by human capital, real per capita income, real minimum wages, and inflation. Human capital, real per capita income and inflation tends to equalizing on income distribution, while real minimum wages tend to have disequalizing effects on income distribution. The results also show that Kuznets U curve hypothesis is empirically confirmed.
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