Jurnal Ekonomi Pembangunan
Vol 19, No 2 (2021): Jurnal Ekonomi Pembangunan

Regional Convergence between Western and Eastern Indonesia

Vanessa Aurelia (Department of Business Economics, School of Business and Economics, Universitas Prasetiya Mulya, Indonesia.)
Lucky Permana (Department of Business Economics, School of Business and Economics, Universitas Prasetiya Mulya, Indonesia.)
Albert Hasudungan (Department of Business Economics, School of Business and Economics, Universitas Prasetiya Mulya, Indonesia)
Alvin Desfiandi (Department of Business Economics, School of Business and Economics, Universitas Prasetiya Mulya, Indonesia)



Article Info

Publish Date
14 Feb 2022

Abstract

This article aims to investigate the existence and determinants of regional convergence of western and eastern Indonesia. Regional convergence itself is a condition where eventually, all regions will grow into one similar level of income. Previous studies seem to verify the existence of regional convergence. Based on previous regional economic scholarship. the regional convergence is signified with the significant relationship of past lag real GDP per capita with current GDP per capita.  However, the increasing gap between western and eastern Indonesia in terms of GDP per capita brings into the critical issue of the possible attainment of the existence of regional convergence in Indonesia. In this paper, the fixed effect panel data regression method was utilized to determine the current state of Indonesia’s regional convergence process and to figure out the relationship of education, mining, and financial development to regional economic growth. From the study, regional convergence is found to be insignificant from 2010 to 2019. This study also managed to determine that financial development, mining contribution, the elementary, and high school enrollment rate is positively correlated with economic growth.

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Journal Info

Abbrev

jep

Publisher

Subject

Economics, Econometrics & Finance

Description

Jurnal Ekonomi Pembangunan is a peer-reviewed journal that provides a forum for scientific works pertaining to Development Economics. Published twice in a year (June and December). This Journal has p-ISSN 1829-5843, and e-ISSN 2685-0788. This journal was first published since June 2003 by the ...