{"title":"Public Health Spending, Governance Quality and Poverty Alleviation","authors":"Mohamad Komarudin, Mandar P. Oak","doi":"10.47291/EFI.V66I2.751","DOIUrl":"https://doi.org/10.47291/EFI.V66I2.751","url":null,"abstract":"Poverty alleviation has become the main priority program in most developing countries. This research empirically studies the correlation between public health spending, governance quality, and poverty alleviation in developing countries. The panel data were estimated via a random-effects (RE) model and robustness check using instrumental variables (IV) (two-stage least-squares [2SLS]) and first-difference generalized method of moments (GMM) because of the endogeneity problem. The results suggest that public health spending has a significant effect on reducing the poverty rate, and that countries with better governance tend to reduce poverty than countries with poor governance. Increasing public health spending by one percentage point may reduce poverty by 0.48 percentage points in countries with good governance supposing the governance quality influences public health spending. Conversely, in countries with poor governance, the poverty headcount ratio may decline by 1.375 percentage points when public health spending increases by one percentage point.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42453891","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Role of Banking Services in Determining the Destination Countries for Indonesia’s Non-Oil and Gas Export","authors":"R. Satriani, T. Machmud","doi":"10.47291/EFI.V66I2.709","DOIUrl":"https://doi.org/10.47291/EFI.V66I2.709","url":null,"abstract":"This study aims to examine whether the risk factor and banking services play a significant role in determining not only the export performance of a country but also the pattern of export destination markets, with the reference to the case of Indonesia. These two indicators are interrelated because the risk factor in export transactions can be mitigated by banking sector. Using the data of export Letter of Credits (LCs) for non-oil and gas exports of Indonesia as a banking instrument to mitigate special risk transactions to 102 export destination countries as well as a panel data methodology for the 2011–2018 period, this study discovers that the risk of export destination countries affects the decline in non-oil and gas exports of Indonesia to the alleged high-risk countries that are non-traditional export markets of Indonesia by 8.34%. In contrast, the LCs only significantly affect the increase in non-oil and gas exports of Indonesia to the lowand medium-risk countries by 0.024–0.029%, most of which are traditional export markets of Indonesia. It implies that banking sector in general does not have the appetite for providing financing for Indonesian exporters attempting to penetrate non-traditional export markets. This result underlines that commercial banks in Indonesia have a significant role in shaping the pattern of destination countries for Indonesian export. Consequently, government intervention is essentially needed by assuming or sharing part of the risk with state banks supposing the government continues to expect exporters to be able to penetrate into the non-traditional countries.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45290228","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"A Decomposition Analysis of Fertility: Evidence from DKI Jakarta and East Nusa Tenggara","authors":"Farma Mangunsong","doi":"10.47291/EFI.V66I2.703","DOIUrl":"https://doi.org/10.47291/EFI.V66I2.703","url":null,"abstract":"Fertility control has been one of the priorities of development in Indonesia. However, the 2000 and 2010 population censuses showed an increase in fertility indicators. To identify the sources of increased fertility in developed and less developed areas, DKI Jakarta and East Nusa Tenggara Provinces were selected for comparison. Using 2000 and 2010 census data, the decomposition analysis shows that the increase in Total Fertility Rate (TFR) of DKI Jakarta was dominated by the increase in nuptiality rate, while the increase in TFR of East Nusa Tenggara was mainly caused by the increase in Marital Fertility Rate (MFR). The highest increase in the proportion of married women in DKI Jakarta occurs in the age group of 15-19 years old, followed by the age group of 20–24 years old. The increase in MFR in East Nusa Tenggara occurs in nearly all age groups, particularly in the age groups of 30–34 and 35–39 years old. Identifying the sources of the increase in TFR is important for population policy to support population growth control, fertility reduction, and human resource quality improvement. The main suggestions based on the findings are the promotion of higher educational level and the benefits of postponing marriage among the younger age groups in DKI Jakarta as well as the use of contraceptive methods to control birth rate in East Nusa Tenggara.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45507439","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Should I Bribe? Re-Examining the Greasing-the-Wheels Hypothesis in Democratic Post-Soeharto Indonesia","authors":"I. Kurniawan, R. Riyanto","doi":"10.47291/EFI.V66I2.792","DOIUrl":"https://doi.org/10.47291/EFI.V66I2.792","url":null,"abstract":"During the Soeharto Era corruption was considered to grease the wheels of growth in Indonesia, a country once considered to be the most corrupt country in the world. Indonesia began to experience instantaneous decentralization and democratization after the Soeharto Era abruptly ended. While vastly celebrated, these episodes have their unintended consequence: coercive regulation. We employed the extensive firm-level Large and Medium Manufacturing (Industri Besar Sedang/IBS) census data combined with the Indonesian Democracy Index (Indeks Demokrasi Indonesia/IDI) at provincial level spanning from 2009 to 2015 and found that bribery hampered Indonesian firm output and productivity growth by 9.8% and 12.6%, respectively. These results suggest that the greasing effect has now diminished. Interestingly, we also found that firms located in a province with a better democracy index may experience less damaging effects of corruption. In other words, two firms paying the same value of bribe may obtain different effects depending on where they are located.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48685492","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Book Review: Central Bank Policy: Theory and Practice","authors":"Denny Irawan","doi":"10.47291/efi.v66i1.691","DOIUrl":"https://doi.org/10.47291/efi.v66i1.691","url":null,"abstract":"I would like to praise the authors for filling in a significant literature gap about central banking, tailored to emerging market context, especially Indonesia. The book has two main contributions. First, it provides a comprehensive literature review of central banking theory and practice. Second, it discusses contemporary challenges in monetary management. In structure, the book is comprised of fifteen chapters, grouped into five parts.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"66 1","pages":"77-78"},"PeriodicalIF":0.0,"publicationDate":"2020-06-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"41423558","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Impact of Human Capital on Shadow Economy in Indonesia","authors":"S. Saraswati, Neli Agustina","doi":"10.47291/efi.v66i1.629","DOIUrl":"https://doi.org/10.47291/efi.v66i1.629","url":null,"abstract":"Shadow economy is a market for legal and illegal goods and services that escape recording and estimation of GDP. It can cause inaccurate estimation of GDP, declining tax revenue, and less precise economic policies. Improving the quality of human capital, both in education and health dimensions, can reduce shadow economy. The research aims to estimate shadow economy and analyze the influence of the quality of human capital on shadow economy in Indonesia. Applying time series multiple linear regression analysis, the findings show that the average shadow economy in Indonesia is 28.97 percent, changes in life expectancy negatively affect changes in shadow economy, while changes in the gross participation rate of tertiary education have a positive effect.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"66 1","pages":"11-24"},"PeriodicalIF":0.0,"publicationDate":"2020-06-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46915216","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Impact of Entrepreneurship on Economic Performance in Indonesia","authors":"Y. Kadarusman","doi":"10.47291/efi.v66i1.684","DOIUrl":"https://doi.org/10.47291/efi.v66i1.684","url":null,"abstract":"Entrepreneurship is claimed to have a positive and significant effect on economic growth in developed countries, but less so in developing countries. Using the growth model, this study examines the impact of entrepreneurship on economic performance in Indonesia as indicated by economic growth and income per-capita from 1985 to 2017. The estimation result confirms the non-significant effect of the growth of entrepreneurial ventures on the growth of GDP per-capita. However, the accumulation of the ventures has a positive and significant effect on the level of GDP per capita. The different typology of entrepreneurial ventures in Indonesia provides some insight to explain the finding, namely: scale does matter. Indonesia already has abundant micro-scale entrepreneurs, but it has only a limited amount of small-scale entrepreneurs, and even fewer medium or large-scale entrepreneurs. This finding contributes to a better understanding of the statistically non-significant impact of entrepreneurship on economic growth in developing countries. This study also suggests that entrepreneurship policy in Indonesia should focus more on facilitating micro-scale ventures to continuously develop toward small, medium, and ultimately large-scale enterprises rather than on creating start-ups.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"66 1","pages":"1-10"},"PeriodicalIF":0.0,"publicationDate":"2020-06-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46531030","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Enhancing Resilience to Turbulent Global Financial Markets: An Indonesian Experience","authors":"S. Indrawati, N. Diop, M. Ikhsan, F. Kacaribu","doi":"10.47291/efi.v66i1.683","DOIUrl":"https://doi.org/10.47291/efi.v66i1.683","url":null,"abstract":"In the empirical literature, large and abrupt declines in capital inflows, or sudden stops, typically hit asset markets and generate output losses in the receiving countries. The significant decrease in capital flows to emerging markets in 2018 is a unique opportunity to test this premise. Using Indonesian data, we found that the sharp decline in capital inflows for over two consecutive quarters in 2018 had an adverse impact on the currency, equities, and bond markets, but no discernible output loss was recorded. Real GDP growth remained resilient throughout 2018 and held broadly steady at around 5 percent in the first quarter of 2019. Furthermore, asset markets rebounded quickly, regaining most of the losses incurred by March 2019. We attribute this resilience to Indonesia’s strong macroeconomic fundamentals and responsive fiscal and monetary policies. We argue that to sustain this resilience in the years to come, complementary structural reforms to boost export-oriented FDI would be needed. The 2020 COVID-19 global pandemic has put the emerging economies to the test again, with a possibly more significant impact. We will revisit our analysis in the future in the aftermath of the pandemic.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"66 1","pages":"47-63"},"PeriodicalIF":0.0,"publicationDate":"2020-06-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48385556","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Corporate Income Tax Rate and Foreign Direct Investment: A Cross-Country Empirical Study","authors":"Amalia Indah Sujarwati, R. Qibthiyyah","doi":"10.47291/efi.v66i1.679","DOIUrl":"https://doi.org/10.47291/efi.v66i1.679","url":null,"abstract":"This study aims to explore the impact of Corporate Income Tax Rate (CITR) on Foreign Direct Investment (FDI), specified based on income levels of countries. Using an unbalanced fixed-effect method of 112 countries over the period of 2003–2017, our finding shows that CITR has no significant impact on FDI. Corporate Income Tax (CIT) is levied on all firms, and as CIT is generally more complex than other types of taxes, its influences on FDI are in question. Excluding tax havens from the sample, our findings show that CITR has a weak significance only in the lower-middle-income and low-income countries.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"66 1","pages":"25-46"},"PeriodicalIF":0.0,"publicationDate":"2020-06-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49602970","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Dayang Haszelinna Abang Ali, Rosita Hamdan, Audrey Liwan, J. Hwang
{"title":"Gender Differences in Children’s Non-Leisure Activities: A Decomposition Analysis","authors":"Dayang Haszelinna Abang Ali, Rosita Hamdan, Audrey Liwan, J. Hwang","doi":"10.47291/efi.v66i1.630","DOIUrl":"https://doi.org/10.47291/efi.v66i1.630","url":null,"abstract":"The prevalence of son preference indicates that girls will have less leisure time compared to boys. This study aims to examine gender differences in weekly hours in schooling, housework, and working among children in Indonesia using Tobit Model and decomposition model of Bauer & Sinning (2005), to test whether son preference explains the differences. The dataset was drawn from the fourth wave of Indonesia Family Life Survey (IFLS) in 2007. The results show significant gender differences in housework and working for children aged 5–14 years and insignificant gender gap in schooling for both age groups. These results confirm the existence of gender differences among younger children compared to older children in their time allocation.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-06-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47322750","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}