IDEAS home Printed from https://ideas.repec.org/a/eee/asieco/v29y2013icp62-79.html
   My bibliography  Save this article

Sources of spatial welfare disparities in Indonesia: Household endowments or returns?

Author

Listed:
  • Skoufias, Emmanuel
  • Olivieri, Sergio

Abstract

This article investigates (i) the extent to which the differences in the standard of living among districts in Indonesia are due to differences in the marginal welfare gains (returns) associated with household mobile endowments or differences in household endowments themselves; and (ii) whether the current allocation of fiscal expenditures by the central authorities is related to the main determinants of the spatial disparities in welfare among districts. Differences in the returns to household mobile characteristics are found to be the primary explanation of the welfare differences. The allocation of fiscal transfers to districts is found to be based on “needs” defined as low returns to household mobile endowments. This also suggests that the design of the fiscal transfer system is consistent with promoting the opportunities for welfare across districts as opposed to equalizing the level of welfare itself. Finally, the marginal welfare gains of most household mobile endowments are found to be higher in districts with more roads.

Suggested Citation

  • Skoufias, Emmanuel & Olivieri, Sergio, 2013. "Sources of spatial welfare disparities in Indonesia: Household endowments or returns?," Journal of Asian Economics, Elsevier, vol. 29(C), pages 62-79.
    • Handle: RePEc:eee:asieco:v:29:y:2013:i:c:p:62-79
    DOI: 10.1016/j.asieco.2013.08.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1049007813000845
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.asieco.2013.08.004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Ravi Kanbur & Hillel Rapoport, 2005. "Migration selectivity and the evolution of spatial inequality," Journal of Economic Geography, Oxford University Press, vol. 5(1), pages 43-57, January.
    2. Saavedra-Chanduví, Jaime & Molinas, José R. & De Barros, Ricardo Paes & Ferreira, Francisco H. G., 2009. "Measuring Inequality of Opportunities in Latin America and the Caribbean," IDB Publications (Books), Inter-American Development Bank, number 361.
    3. Anthony J. Venables, 2005. "Spatial disparities in developing countries: cities, regions, and international trade," Journal of Economic Geography, Oxford University Press, vol. 5(1), pages 3-21, January.
    4. Cut Dian R.D. Agustina & Wolfgang Fengler & Günther G. Schulze, 2012. "The regional effects of Indonesia's oil and gas policy: options for reform," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 48(3), pages 369-397, December.
    5. Emmanuel Skoufias & Gladys Lopez-Acevedo, 2009. "Latin America - Determinants of Regional Welfare Disparities within Latin American Countries : Synthesis," World Bank Publications - Reports 3048, The World Bank Group.
    6. Skoufias, Emmanuel & Narayan, Ambar & Dasgupta, Basab & Kaiser, Kai, 2011. "Electoral accountability, fiscal decentralization and service delivery in Indonesia," Policy Research Working Paper Series 5614, The World Bank.
    7. Krugman, Paul, 1998. "What's New about the New Economic Geography?," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 14(2), pages 7-17, Summer.
    8. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-499, June.
    9. David Card & Alan B. Krueger, 1990. "Does School Quality Matter? Returns to Education and the Characteristics of Public Schools in the United States," Working Papers 645, Princeton University, Department of Economics, Industrial Relations Section..
    10. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
    11. Card, David & Krueger, Alan B, 1992. "Does School Quality Matter? Returns to Education and the Characteristics of Public Schools in the United States," Journal of Political Economy, University of Chicago Press, vol. 100(1), pages 1-40, February.
    12. McCulloch, Neil & Sjahrir, Bambang Suharnoko, 2008. "Endowments, location or luck ? evaluating the determinants of sub-national growth in decentralized Indonesia," Policy Research Working Paper Series 4769, The World Bank.
    13. Gordon B. Dahl, 2002. "Mobility and the Return to Education: Testing a Roy Model with Multiple Markets," Econometrica, Econometric Society, vol. 70(6), pages 2367-2420, November.
    14. Emmanuel Skoufias & Roy S. Katayama, 2011. "Sources of welfare disparities between and within regions of Brazil: evidence from the 2002--2003 household budget survey (POF)," Journal of Economic Geography, Oxford University Press, vol. 11(5), pages 897-918, September.
    15. Pitt, Mark M & Rosenzweig, Mark R & Gibbons, Donna M, 1993. "The Determinants and Consequences of the Placement of Government Programs in Indonesia," The World Bank Economic Review, World Bank, vol. 7(3), pages 319-348, September.
    16. Emmanuel Skoufias & Sergio Olivieri, 2013. "Geographic disparities in well being and fiscal expenditures in Thailand: 2000 vs. 2009," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 18(3), pages 359-381.
    17. repec:idb:brikps:60098 is not listed on IDEAS
    18. Blackorby, Charles & Donaldson, David, 1987. "Welfare ratios and distributionally sensitive cost-benefit analysis," Journal of Public Economics, Elsevier, vol. 34(3), pages 265-290, December.
    19. Angus Deaton & Salman Zaidi, 2002. "Guidelines for Constructing Consumption Aggregates for Welfare Analysis," World Bank Publications, The World Bank, number 14101, April.
    20. World Bank, 2003. "Decentralizing Indonesia : A Regional Public Expenditure Review Overview Report," World Bank Publications - Reports 14632, The World Bank Group.
    21. World Bank, 2009. "World Development Report 2009," World Bank Publications - Books, The World Bank Group, number 5991, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. World Bank Group, 2017. "Convergence without Equity," World Bank Publications - Reports 30045, The World Bank Group.
    2. Elbaar, Evi Feronika & Masliani, 2024. "Renewable Energy Intentions in Indonesian Agriproduct Purchasing: Exploring Product Quality, Customer Orientation, Perceived Environmental Knowledge, and Farmers’ Knowledge with a Moderation Effect," AGRIS on-line Papers in Economics and Informatics, Czech University of Life Sciences Prague, Faculty of Economics and Management, vol. 16(4), December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. World Bank Group, 2017. "Convergence without Equity," World Bank Publications - Reports 30045, The World Bank Group.
    2. Christopher Bollinger & James P. Ziliak & Kenneth R. Troske, 2011. "Down from the Mountain: Skill Upgrading and Wages in Appalachia," Journal of Labor Economics, University of Chicago Press, vol. 29(4), pages 819-857.
    3. Greg Kaplan & Sam Schulhofer‐Wohl, 2017. "Understanding The Long‐Run Decline In Interstate Migration," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 58, pages 57-94, February.
    4. Breinlich, Holger & Ottaviano, Gianmarco I.P. & Temple, Jonathan R.W., 2014. "Regional Growth and Regional Decline," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 4, pages 683-779, Elsevier.
    5. repec:esx:essedp:729 is not listed on IDEAS
    6. Greg Kaplan & Sam Schulhofer‐Wohl, 2017. "Understanding The Long‐Run Decline In Interstate Migration," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 58(1), pages 57-94, February.
    7. Omar Arias & Gustavo Yamada & Luis Tejerina, 2004. "Education, family background and racial earnings inequality in Brazil," International Journal of Manpower, Emerald Group Publishing Limited, vol. 25(3/4), pages 355-374, April.
    8. Pedro Carneiro & Sokbae Lee, 2011. "Trends in Quality-Adjusted Skill Premia in the United States, 1960-2000," American Economic Review, American Economic Association, vol. 101(6), pages 2309-2349, October.
    9. Paul Glewwe, 2002. "Schools and Skills in Developing Countries: Education Policies and Socioeconomic Outcomes," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 436-482, June.
    10. Nikolov, Plamen & Jimi, Nusrat & Chang, Jerray, 2020. "The Importance of Cognitive Domains and the Returns to Schooling in South Africa: Evidence from Two Labor Surveys," Labour Economics, Elsevier, vol. 65(C).
    11. Mona Said & Fatma El-Hamidi, 2008. "Taking Technical Education Seriously in MENA: Determinants, Labor Market Implications and Policy Lessons," Working Papers 450, Economic Research Forum, revised 09 Jan 2008.
    12. Ivo Bischoff & Ferry Prasetyia, 2015. "Determinants of local public expenditures on education: empirical evidence for Indonesian districts between 2005 and 2012," MAGKS Papers on Economics 201532, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
    13. Gurleen Popli & Okan Yılmaz, 2017. "Educational Attainment and Wage Inequality in Turkey," LABOUR, CEIS, vol. 31(1), pages 73-104, March.
    14. Huy Le-Quang & Ehsan Vallizadeh, 2022. "The returns to school-quality-adjusted education of immigrants in Germany," Journal for Labour Market Research, Springer;Institute for Employment Research/ Institut für Arbeitsmarkt- und Berufsforschung (IAB), vol. 56(1), pages 1-15, December.
    15. Nicole Schneeweis, 2011. "Educational institutions and the integration of migrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(4), pages 1281-1308, October.
    16. Behrman, Jere R., 1996. "Measuring the effectiveness of schooling policies in developing countries: Revisiting issues of methodology," Economics of Education Review, Elsevier, vol. 15(4), pages 345-364, October.
    17. Marine de Talance, 2017. "Wealth Inequalities in Perceptions of School Quality in Pakistan," Working Papers hal-01662698, HAL.
    18. Frick, Susanne A. & Rodríguez-Pose, Andrés, 2018. "Change in urban concentration and economic growth," World Development, Elsevier, vol. 105(C), pages 156-170.
    19. Suhonen, Tuomo, 2013. "Are there returns from university location in a state-funded university system?," Regional Science and Urban Economics, Elsevier, vol. 43(3), pages 465-478.
    20. Emmanuel Skoufias & Gladys Lopez-Acevedo, 2009. "Latin America - Determinants of Regional Welfare Disparities within Latin American Countries : Synthesis," World Bank Publications - Reports 3048, The World Bank Group.
    21. Eric A. Hanushek & Jens Ruhose & Ludger Woessmann, 2015. "Human Capital Quality and Aggregate Income Differences: Development Accounting for U.S. States," CESifo Working Paper Series 5411, CESifo.

    More about this item

    Keywords

    Indonesia; Geographic disparities; Welfare; Fiscal expenditures;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • I30 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • R0 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:asieco:v:29:y:2013:i:c:p:62-79. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/asieco .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.