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Poverty in Remote Regions: Evidence from the Papua Highlands of Indonesia

Author

Listed:
  • Taosige Wau

    (UIN Sunan Kalijaga Yogyakarta, Indonesia)

  • Farawi Ghannili

    (UIN Sunan Kalijaga Yogyakarta, Indonesia)

Abstract

This study examines the structural determinants of poverty in the Papua Highlands, Indonesia, where poverty persists despite substantial Special Autonomy fiscal transfers. Using a balanced panel of 16 highland districts from 2010 to 2023 and a dynamic panel model estimated with System GMM, the study examines the effects of human capital, economic conditions, and public spending on poverty rates. The results indicate strong poverty persistence. Mean years of schooling, life expectancy, and government spending on education and health are negatively associated with poverty, whereas per capita GRDP and capital spending show weak or ambiguous effects. These findings suggest that growth and infrastructure investment are not automatically pro-poor in this region. The study contributes context-specific evidence to development economics by showing how remoteness, human capital constraints, and public policy interact in disadvantaged regions, while emphasizing that the findings should be interpreted within the distinctive context of the Papua Highlands.

Suggested Citation

  • Taosige Wau & Farawi Ghannili, 2026. "Poverty in Remote Regions: Evidence from the Papua Highlands of Indonesia," Journal of Economic Development, The Economic Research Institute, Chung-Ang University, vol. 51(2), pages 43-67, June.
    • Handle: RePEc:ris:jecdev:023037
    DOI: 10.35866/caujed.2026.51.2.003
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    Keywords

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    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • P36 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
    • P46 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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