Volume 20 Issue 1, April 2025
ARTICLE INFO
Article History:
Received: 26 November 2024
Accepted: 16 April 2025
Published: 30 April 2025
ASIA-PACIFIC MANAGEMENT ACCOUNTING JOURNAL. VOL. 20 ISSUE 1
REALIZING INCLUSIVE ECONOMIC GROWTH: ANALYSIS OF THE DETERMINANTS OF INCOME AND POVERTY REDUCTION ON THE ISLANDS OF SUMATRA AND JAVA
Mairizal Salehudin Siatan1♣, Marselina1, I Wayan Suparta1 and Hanif2
1Faculty of Economics and Business, University of Lampung, Indonesia
2Faculty of Islamic Economics and Business, Raden Intan Lampung State Islamic University, Indonesia
ABSTRACT
Inclusive growth involves social and economic dimensions, emphasizing participation from all societal segments in development processes and outcomes. This study used panel data comprising time series (2017–2022) and cross sections from 10 provinces in Sumatra and 6 in Java, analyzed using the Ordinary Least Square (OLS) method. The results revealed that 1% significant negative inflation reduced inclusive growth by 0.064%, 1 kilometer of good road infrastructure increased it by 0.061%, and a 1-person increase in the workforce boosted it by 0.065%. Regarding income inclusiveness and poverty reduction, a 1-million-rupiah rise in the agricultural sector’s GRDP increased inclusive growth by 0.14%, an additional person in the population contributed 0.99%, and a 1% rise in financial inclusion enhanced it by 0.07%. In Sumatra, the agricultural sector was pivotal for inclusive growth, while in Java, population density was more significant. Across both regions, road infrastructure, workforce, and financial inclusion collectively drove connectivity, productivity, and poverty reduction. This research provides a vital framework for developing area-specific policies that promote inclusive development.
Keywords: Economy, Inclusive Growth, Income, Poverty