Provincial Real Economic Growth in Indonesia: Investigating Key Factors Through Spatial Analysis

Authors

  • Kahar Muzzakar Statistics of Aceh Province, Banda Aceh 23121, Indonesia; Department of Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia
  • Sofyan Syahnur Department of Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia
  • Muhammad Abrar Department of Economics, Faculty of Economics and Business, Universitas Syiah Kuala, Banda Aceh 23111, Indonesia

DOI:

https://doi.org/10.60084/eje.v1i2.66

Keywords:

Geographically weighted panel regression, Gross regional domestic product, Poverty indicators , Quality economic growth, Real economic growth

Abstract

This study addresses the need to understand provincial real economic growth, as measured by gross regional domestic product (GRDP), by conducting a spatial analysis. The study focuses on the influential factors of physical investment, working labor force, social infrastructure relative to the head-count index of poverty, and human development index (HDI). Data from 34 provinces spanning eight years (2015-2022) were examined using geographically weighted panel regression with a fixed effect of provincial units and adaptive bisquare kernel function as spatial weights. The study identifies distinct spatial patterns in the variable impact on provincial real economic growth, forming groups based on influential factors. Physical investment and HDI significantly drive growth in most provinces. The working labor force strongly impacts Papua Island’s growth. Intriguingly, social infrastructure relative to the head-count index of poverty link to economic growth emerges in the central and eastern regions of Indonesia (Kalimantan, Sulawesi, Maluku, and Papua), highlighting its role in poverty reduction and inclusive growth. The findings highlight the importance of region-specific policies to optimize the potential of these variables and promote balanced economic growth across the province.

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Published

2023-08-28

How to Cite

Muzzakar, K., Syahnur, S. and Abrar, M. (2023) “Provincial Real Economic Growth in Indonesia: Investigating Key Factors Through Spatial Analysis”, Ekonomikalia Journal of Economics, 1(2), pp. 40–50. doi: 10.60084/eje.v1i2.66.

Issue

Vol. 1 No. 2 (2023): November 2023

Section

Articles

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Copyright (c) 2023 Kahar Muzzakar, Sofyan Syahnur, Muhammad Abrar

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This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.