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Regional Poverty

Regional Poverty

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Published by Iwan Nugroho
Iwan Nugroho. 1997. Analysis of Regional Poverty of Indonesia in 1994 Using Binary Choice . JIUWG (tahun 1997) 3(5):283-292. ISSN 0854-3437
Iwan Nugroho. 1997. Analysis of Regional Poverty of Indonesia in 1994 Using Binary Choice . JIUWG (tahun 1997) 3(5):283-292. ISSN 0854-3437

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Published by: Iwan Nugroho on Aug 19, 2009
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ANALYSIS OF REGIONAL POVERTY IN INDONESIA 1994USING BINARY CHOICE MODEL
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 Iwan NugrohoIntroduction
 The development economies in the least developing countries (LDCs) could be viewedthrough two sides, i.e. structural and orthodox. Structuralists that lead by Myrdal andGundar Frank view the LDC’s development unoptimisticlly as a result of a wide gap to theindustrial countries. The industrial countries pose a strong political power to arrange theinternational trade that could bring various of disadvantage conditions in the LDCs.Structuralism follower believe the independence theory where the LDCs as a peripherywould highly depend on the industrial countries as a center. If a center, for example, willingto close their company because bankrupt and move out of the country, so the LDCs aswould being in crises economically. The kinds of multinational corporations are a realevident for this even though it was interpreted softly. Finally, such condition lead the mostof people in the LDCs to below the standard of quality life.Meanwhile, the followers of orthodoxism that lead by Rostow and Lal believe thateconomic growth do on the way with ‘tricle down effect’ process. The LDCs presumed toobtained benefits from the demand of various the raw materials in industrial countries.Rostow introduced five steps model of economic development coupled with thetransformation process where each country naturally do. Indeed, the primary sectors withthe low productivity (such as agriculture and forestry) decrease their share replaced by thesecondary sectors (such as industry and services) with a higher productivity. Thesetransformation bring a great effects not only on an economic significant, but also on thelabor force. The ideal condition of these are a decrease in agriculture economic’s share toGDP accompanied by a decrease in agriculture labor force’s share to the national labor force.However, the transformation process in the LDCs has never worked as expected. InIndonesia (1996 year), agricultural economic’s share actually has decreased to 19 percent,however, it still contained amount of 48 percent of national labor force. It means that 19 plates of rice have to be eaten by 48 people. The comparison between economic and labor force share in agricultural sector in others the LDCs are (World Bank, 1996): Sri Lanka (25,53), Malaysia (19, 42), Thailand (15, 71), Bangladesh (41, 75), China (30, 74),Pakistan (26,55), and Filipina (26, 52). The higher of percentage and more far of its distiction of bothvalues means more weight of burden in agriculture sector. Compare those picture with theindustrial countries such as Great Britain (1, 3), French (3, 9), Canada (2, 5), and Unitedstates (2, 3). Furthermore, The US even though only 2 percent economic share of agriculturecould be enough to feed to people around the world.Such unsuitable transformation especially in Indonesia mostly yielded the diasadvatageconditions such as informal sector in urban region as result of urbanization significances.They who were dominantly man worker going to town leaving their family in village. As a
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Dipublikasi di JIUWG (tahun 1997) 3(5):283-292. ISSN 0854-3437
 
 3 
result, there are a marked changed of gender orientation in agricultural sector in villagecommonly. The women worker have been predominant and her role become more importantto survive the family life. They often could not be escaped to exploit the natural resourceswhere its environment is usually bad and without suppoted by an appropriate technology.Thereby, these description then reveal the feminization of poverty in rural region (Iwan Nugroho, 1996).Analysis and research on the poverty phenomenon have been well known (Sajogyo,1975; Bidani dan Ravallion, 1993; Booth, 1993; Worl Bank, 1993). The study generallyused poverty parameter based on an economic measures such as income, consumption, andother basic needs which it was then quantified to the monetize basis. Despite theseapproach is reliable enough as foundation to formulate into a poverty allevition policy,however, the recent situations urgently imposed to incorporate other variables primarilyfrom social indicators. In this relation, World Bank (1993, 1995) have identified more than12 items summarized in
 priority
dan
 supplementary
 
 poverty indicators
which it is expectedto provide guidance in poverty alleviation programs in the LDCs. These are popularlydepicted as development diamond, consist of four angle: (1) GNP per capita, (2) access toclean water, (3) life expectancy, and (4) gross primary enrollment ratio.
Objective
 The objective of the research study is to analyze the regional poverty in Indonesia using1994 data through the binary choice models, with considering social and welfare indicatorsinto the model and obtaining probability number of each region.
Kerangka Pemikiran1.
Penyusunan Model
 
Bank Dunia secara implisit mengemukakan bahwa kemiskinan dipengaruhi olehkondisi dasar alami (
resource endowment 
) dan pengaruh pembangunan (
improvement 
).Dalam studi ini modelnya disusun sebagai berikut (enam pertama adalah faktor alami,sisanya akibat faktor pembangunan):
POVi = f(WKi, LFi, PEi, RYPi, KIi, AGEi, WATi, Ci, RGDPi, C-RGDPi, RGDPKi, LIi, MDi)
dimana :POVi : poverty criterion (0 poor, 1 not poor)WKi : share of agricultural women worker to national women worker (%)LFi : share of agricultural labor force to national labor force (%)PEi : percentage of population passed primary education (%)RYPi : existence of Red Yellow Podzolik (RYP) and its association (0 not found, 1found)GEOi : geographical region (1 western Indonesia, 0 eastern Indonesia)AGEi : percentage of population above 65 years age (%)WATi : percentage of population posed a drink water facility individually (%)Ci : consumption (Rp/year.capita)RGDPi : regional gross domestic product (Rp)C-RGDP : ratio consumption to RGDP (%)RGDPKi : regional gross domestic product per capita (Rp)ELi : percentage of population posed electric facility (%)MDi : percentage of baby birth helped by doctor or medical specialist (%)i : region or province

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