INFRASTRUCTURE EXPENDITURE AND POVERTY REDUCTION IN INDONESIA

Abstract

The purpose of this paper is to examine the impact of infrastructure expenditure to education, health and roads on poverty reduction in Indonesia. The relationship of both variables controlled through other determinants such as locally generated revenue, gross regional domestic product, population and good governance index. Using Data Panel in Indonesia years 2006 up to 2015, were analyzed using an econometric model with fixed effect regression. The results show that infrastructure expenditure to education and health have a negative influence significantly to poverty reduction, while road infrastructure expenditure has not significant impact on poverty reduction in Indonesia.

Keywords

• Infrastructure expenditure
• poverty reduction
• good governance
• education
• people health