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Inequality and Political Trust in Indonesia

Author

Listed:
  • Eldes Natalya Hutagalung

    (Master of Applied Economics, Padjadjaran University)

  • Takahiro Akita

    (Graduate School of International Relations International University of Japan)

  • Mohamad Fahmi

    (Department of Economics, Padjadjaran University)

Abstract

Inequality persists across the world. Numerous social and political consequences emerge due to the wide gap between the rich and the poor. For politics, previous empirical studies confirm that higher inequality is associated with a decline of political trust, which may hurt a country’s democratic legitimacy. In a highly unequal society, poor citizens feel worse off and are likely to blame the government for their situation. They judge the government as unfair for giving special treatment to the rich, as its policies mostly reflect the preferences of upper-income groups. This pattern should be particularly accentuated in Indonesia. Given the country’s large income inequality, the issue of political trust has been attracting public concern. This study therefore aims to verify the negative effect of inequality on political trust at the district level. We look at five different governmental entities–the presidency, the house of representatives, governors, police, and the court system–to analyze political trust. Unexpectedly, our results do not agree with previous studies. They show that there is no evidence that inequality dampens political trust in Indonesia. The coefficients of inequality measurements are positive, implying that households in unequal districts on average exhibit more trust in government. The change in inequality shows, however, the negative effect on political trust because as inequality decreases or increases, households’ level of trust in government will increase or decrease in turn.

Suggested Citation

  • Eldes Natalya Hutagalung & Takahiro Akita & Mohamad Fahmi, 2019. "Inequality and Political Trust in Indonesia," Working Papers in Economics and Development Studies (WoPEDS) 201904, Department of Economics, Padjadjaran University, revised Nov 2019.
  • Handle: RePEc:unp:wpaper:201904
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    File URL: http://ceds.feb.unpad.ac.id/wopeds/201904.pdf
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    References listed on IDEAS

    as
    1. Perdamen Sagala & Takahiro Akita & Arief Yusuf, 2014. "Urbanization and expenditure inequality in Indonesia: testing the Kuznets hypothesis with provincial panel data," Letters in Spatial and Resource Sciences, Springer, vol. 7(3), pages 133-147, October.
    2. Frederick Solt, 2008. "Economic Inequality and Democratic Political Engagement," American Journal of Political Science, John Wiley & Sons, vol. 52(1), pages 48-60, January.
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    4. Alesina, Alberto & La Ferrara, Eliana, 2002. "Who trusts others?," Journal of Public Economics, Elsevier, vol. 85(2), pages 207-234, August.
    5. Easton, David, 1975. "A Re-assessment of the Concept of Political Support," British Journal of Political Science, Cambridge University Press, vol. 5(4), pages 435-457, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Political Trust; Inequality; Change of Inequality;
    All these keywords.

    JEL classification:

    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty

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