IDEAS home Printed from https://ideas.repec.org/p/hhs/luekhi/0164.html
   My bibliography  Save this paper

Transforming Indonesia: Structural change in a regional perspective 1968-2010

Author

Listed:
  • Axelsson, Tobias

    (Department of Economic History, Lund University)

  • Palacio, Andrés

    (Department of Economic History, Lund University)

Abstract

Since 1968, Indonesia has been among the few developing countries able to sustain per capita income growth over 5%. However, poverty and surplus labor are still main features of the economy. We ask to what extent the dual nature of growth has stimulated structural change, or just rewarded a particular sector or region. We find that the emblematic State support to agriculture has not untapped the potential growth in labour reallocation. Despite the income diversification within and outside agriculture, the linkages between sectors and regions remain weak. For catching up, the integration of the outer regions into the economy must still go through agriculture, investment in human capital, infrastructure, social policies and local capabilities.

Suggested Citation

  • Axelsson, Tobias & Palacio, Andrés, 2017. "Transforming Indonesia: Structural change in a regional perspective 1968-2010," Lund Papers in Economic History 164, Lund University, Department of Economic History.
    • Handle: RePEc:hhs:luekhi:0164
    as

    Download full text from publisher

    File URL: http://lup.lub.lu.se/record/e9b738b8-7bf0-4840-ae14-ee0403ec6213
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kuznets, Paul W, 1988. "An East Asian Model of Economic Development: Japan, Taiwan, and South Korea," Economic Development and Cultural Change, University of Chicago Press, vol. 36(3), pages 11-43, Supplemen.
    2. Gaaitzen de Vries & Marcel Timmer & Klaas de Vries, 2015. "Structural Transformation in Africa: Static Gains, Dynamic Losses," Journal of Development Studies, Taylor & Francis Journals, vol. 51(6), pages 674-688, June.
    3. Hill,Hal, 2000. "The Indonesian Economy," Cambridge Books, Cambridge University Press, number 9780521663670, October.
    4. C. Peter Timmer, 2004. "The road to pro-poor growth: the Indonesian experience in regional perspective," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 40(2), pages 177-207.
    5. Tommy Firman, 2009. "Decentralization Reform And Local†Government Proliferation In Indonesia: Towards A Fragmentation Of Regional Development," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 21(2†3), pages 143-157, July.
    6. World Bank, 2007. "Agricultural Extension Services in Indonesia : New Approaches and Emerging Issues," World Bank Publications - Reports 7950, The World Bank Group.
    7. Hal Hill & Budy Resosudarmo & Yogi Vidyattama, 2008. "Indonesia'S Changing Economic Geography," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 44(3), pages 407-435.
    8. Andy Sumner, 2010. "Global Poverty and the New Bottom Billion: What if Three-quarters of the World’s Poor Live in Middle-income Countries?," Working Papers 74, International Policy Centre for Inclusive Growth.
    9. Anne Booth, 2002. "The Changing Role Of Non-Farm Activities In Agricultural Households In Indonesia: Some Insights From The Agricultural Censuses," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 38(2), pages 179-200.
    10. World Bank, 2007. "Indonesia - Public Expenditure and Financial Accountability : Public Financial Management Performance Report and Performance Indicators," World Bank Publications - Reports 7715, The World Bank Group.
    11. Pantjar Simatupang & C. Peter Timmer, 2008. "Indonesian Rice Production: Policies And Realities," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 44(1), pages 65-80.
    12. Manning,Chris, 1998. "Indonesian Labour in Transition," Cambridge Books, Cambridge University Press, number 9780521594127, October.
    13. Dionisius Narjoko, 2014. "Did Better Firms Enter the Indonesian Manufacturing Sector after the 1997-98 Crisis?," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 50(3), pages 371-391, December.
    14. N/A, 2005. "The World Economy," National Institute Economic Review, National Institute of Economic and Social Research, vol. 191(1), pages 8-30, January.
    15. Margaret S. McMillan & Kenneth Harttgen, 2014. "What is driving the 'African Growth Miracle'?," NBER Working Papers 20077, National Bureau of Economic Research, Inc.
    16. Francois Bourguignon, 2004. "The Poverty-growth-inequality triangle," Indian Council for Research on International Economic Relations, New Delhi Working Papers 125, Indian Council for Research on International Economic Relations, New Delhi, India.
    Full references (including those not matched with items on IDEAS)

    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. Andy Sumner & Peter Edward, 2013. "From Low Income, High Poverty to High-Income, No Poverty? An Optimistic View of the Long-Run Evolution of Poverty in Indonesia By International Poverty Lines, 1984–2030," Working Papers in Economics and Development Studies (WoPEDS) 201310, Department of Economics, Padjadjaran University, revised Jun 2013.
    2. Hal Hill, 2007. "The Indonesian Economy: Growth, Crisis And Recovery," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 52(02), pages 137-166.
    3. Temple, Jonathan & Ying, Huikang, 2014. "Life During Structural Transformation," CEPR Discussion Papers 10297, C.E.P.R. Discussion Papers.
    4. Andrew Shepherd & Sylvia Bishop, 2013. "Aid and Poverty: Why Does Aid Not Address Poverty (Much)?," WIDER Working Paper Series wp-2013-020, World Institute for Development Economic Research (UNU-WIDER).
    5. C. Peter Timmer, 2004. "The road to pro-poor growth: the Indonesian experience in regional perspective," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 40(2), pages 177-207.
    6. Takahiro Akita & Sachiko Miyata, 2018. "Spatial Inequalities in Indonesia, 1996–2010: A Hierarchical Decomposition Analysis," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 138(3), pages 829-852, August.
    7. John Ssozi & Edward Bbaale, 2019. "The Effects of the Catch-Up Mechanism on the Structural Transformation of Sub-Saharan Africa," Economies, MDPI, vol. 7(4), pages 1-27, November.
    8. Leigh, Andrew & van der Eng, Pierre, 2009. "Inequality in Indonesia: What can we learn from top incomes?," Journal of Public Economics, Elsevier, vol. 93(1-2), pages 209-212, February.
    9. Peter Timmer, 2018. "Pro-poor growth in Indonesia: Challenging the pessimism of Myrdal's Asian Drama," WIDER Working Paper Series wp-2018-103, World Institute for Development Economic Research (UNU-WIDER).
    10. 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.
    11. Takahiro Akita & Awaludin Aji Riadi & Ali Rizal, 2021. "Fiscal disparities in Indonesia in the decentralization era: Does general allocation fund equalize fiscal revenues?," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(6), pages 1842-1865, December.
    12. Matthias Busse & Ceren Erdogan & Henning Mühlen, 2019. "Structural transformation and its relevance for economic growth in Sub‐Saharan Africa," Review of Development Economics, Wiley Blackwell, vol. 23(1), pages 33-53, February.
    13. Rasiah, Rajah, 2004. "Technological Intensity and Export Incidence: A Study of Foreign and Local Auto-Parts, Electronics and Garment Firms in Indonesia," UNU-INTECH Discussion Paper Series 2004-05, United Nations University - INTECH.
    14. McMillan, Margaret & Rodrik, Dani & Sepulveda, Claudia, 2017. "Structural Change, Fundamentals, and Growth: A Framework and Case Studies," Working Paper Series rwp17-024, Harvard University, John F. Kennedy School of Government.
    15. Hal Hill, 2018. "Asia's Third Giant: A Survey of the Indonesian Economy," The Economic Record, The Economic Society of Australia, vol. 94(307), pages 469-499, December.
    16. Rekha Ravindran & Suresh Babu Manalaya, 2023. "Does Premature Deindustrialisation Stall Growth? Evidence from Sub-Saharan Africa," Progress in Development Studies, , vol. 23(1), pages 65-81, January.
    17. Andriansyah & Asep Nurwanda & Bakhtiar Rifai, 2023. "Structural Change and Regional Economic Growth in Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 59(1), pages 91-117, January.
    18. Peter Timmer, 2018. "Pro-poor growth in Indonesia: Challenging the pessimism of Myrdal’s Asian Drama," WIDER Working Paper Series 103, World Institute for Development Economic Research (UNU-WIDER).
    19. Alastaire Sèna ALINSATO, 2015. "Globalization, Poverty And Role Of Infrastructures," Journal of Economics and Political Economy, KSP Journals, vol. 2(1s), pages 197-212, May.
    20. Gaaitzen de Vries & Marcel Timmer & Klaas de Vries, 2015. "Structural Transformation in Africa: Static Gains, Dynamic Losses," Journal of Development Studies, Taylor & Francis Journals, vol. 51(6), pages 674-688, June.

    More about this item

    Keywords

    agriculture; regional structural change; growth; stagnation; shrinking; Indonesia;
    All these keywords.

    JEL classification:

    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:hhs:luekhi:0164. 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: Tobias Karlsson or Benny Carlsson (email available below). General contact details of provider: https://edirc.repec.org/data/dhlunse.html .

    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.