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Chronic and Transient Poverty in Indonesia: A Spatial Perspective with the 2008-2010 Susenas Panel Data

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Abstract

This study analyzes poverty dynamics by region for urban and rural areas based on the 2008-2010 panel Susenas. It also conducts a probit analysis to explore the determinants of poverty based on the 2008 consumption module Susenas. We found that while 11% of rural people and 7% of urban people are chronically poor, there are a large number of transiently poor people in Indonesia. These transiently poor people have a high risk of falling into poverty occasionally. There is also a large difference in the extent of chronic and transient poverty among regions. While the government should implement policies to alleviate chronic poverty, it should at the same time introduce policies that could keep transiently poor people above the poverty line. Since there is a large regional variation in the extent of poverty, spatially differentiated poverty alleviation programs should be introduced according to the extent and nature of poverty.

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File URL: http://www.iuj.ac.jp/workingpapers/index.cfm?File=EMS_2013_19.pdf
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Bibliographic Info

Paper provided by Research Institute, International University of Japan in its series Working Papers with number EMS_2013_19.

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Length: 28 pages
Date of creation: Sep 2013
Date of revision:
Handle: RePEc:iuj:wpaper:ems_2013_19

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Keywords: chronic and transient poverty; poverty dynamics; spatial perspective; panel data; Indonesia;

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  1. Bird, Kelly & Manning, Chris, 2008. "Minimum Wages and Poverty in a Developing Country: Simulations from Indonesia's Household Survey," World Development, Elsevier, vol. 36(5), pages 916-933, May.
  2. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-66, May.
  3. Armida Alisjahbana & Arief Anshory Yusuf, 2003. "Poverty Dynamics In Indonesia: Panel Data Evidence," Working Papers in Economics and Development Studies (WoPEDS) 200303, Department of Economics, Padjadjaran University, revised Jul 2003.
  4. Martin Ravallion & Michael Lokshin, 2007. "Lasting Impacts of Indonesia’s Financial Crisis," Economic Development and Cultural Change, University of Chicago Press, vol. 56, pages 27-56.
  5. Asep Suryahadi & Gracia Hadiwidjaja & Sudarno Sumarto, 2012. "Economic growth and poverty reduction in Indonesia before and after the asian financial crisis," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 48(2), pages 209-227, August.
  6. Asep Suryahadi & Sudarno Sumarto & Lant Pritchett, 2003. "Evolution of Poverty During the Crisis in Indonesia," Asian Economic Journal, East Asian Economic Association, vol. 17(3), pages 221-241, 09.
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  8. Jed Friedman & James Levinsohn, 2001. "The Distributional Impacts of Indonesia's Financial Crisis on Household Welfare: A "Rapid Response" Methodology," NBER Working Papers 8564, National Bureau of Economic Research, Inc.
  9. Fields, Gary S. & Cichello, Paul & Freije, Samuel & Menéndez, Marta & Newhouse, David, 2003. "For Richer or for Poorer ? Evidence from Indonesia, South Africa, Spain, and Venezuela," Economics Papers from University Paris Dauphine 123456789/1560, Paris Dauphine University.
  10. Asep Suryahadi & Sudarno Sumarto, 2003. "Poverty and Vulnerability in Indonesia Before and After the Economic Crisis," Asian Economic Journal, East Asian Economic Association, vol. 17(1), pages 45-64, 03.
  11. Teguh Dartanto & Nurkholis, 2013. "The determinants of poverty dynamics in Indonesia: evidence from panel data," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 49(1), pages 61-84, April.
  12. Anne Booth, 2000. "Poverty and Inequality in The Soeharto Era: An Assessment," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 36(1), pages 73-104.
  13. Jonathan Haughton & Shahidur R. Khandker, 2009. "Handbook on Poverty and Inequality," World Bank Publications, The World Bank, number 11985, July.
  14. Hulme, David & Shepherd, Andrew, 2003. "Conceptualizing Chronic Poverty," World Development, Elsevier, vol. 31(3), pages 403-423, March.
  15. Emmanuel Skoufias & Asep Suryahadi, 2000. "Changes in Household Welfare, Poverty and Inequality During the Crisis," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 36(2), pages 97-114.
  16. Arsenio Balisacan & Ernesto Pernia & Abuzar Asra, 2003. "Revisiting growth and poverty reduction in Indonesia: what do subnational data show?," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 39(3), pages 329-351.
  17. Wenefrida Widyanti & Asep Suryahadi & Sudarno Sumarto & Athia Yumna, 2009. "The Relationship between Chronic Poverty and Household Dynamics : Evidence from Indonesia," Microeconomics Working Papers 22554, East Asian Bureau of Economic Research.
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