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Abstract
This research aims to analyze the effect of economic growth on income inequality, labor absorption and economic welfare in Indonesian provinces. A 165 observations of panel data was analyzed using path analysis. The result showed that the economic growth has significant negative effect on income inequality in Indonesian provinces but it has no significant effect on both labor absorption and economic welfare. The labor absorption has significant positive effect on income inequality even though it has no significant effect on economic welfare. In addition, the economic welfare is not significantly influenced by the income inequality.
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References
- Armstrong, H., & Taylor, J. (2000). Regional economics and policy (3rd ed.). Blackwell.
- Barro, R. J. (2000). Inequality and growth in a panel of countries. Journal of Economic Growth, 5(1), 5–32. https://doi.org/10.1023/A:1009850119329
- Barro, R. J., & Sala-I-Martin, X. (2004). Economic growth second edition (2nd ed.). Massachusetts: MIT Press.
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- Grossman, G. M., & Helpman, E. (1989). Growth and welfare in a small open economy (NBER Working Paper No. 2970). Cambridge, MA.
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References
Armstrong, H., & Taylor, J. (2000). Regional economics and policy (3rd ed.). Blackwell.
Barro, R. J. (2000). Inequality and growth in a panel of countries. Journal of Economic Growth, 5(1), 5–32. https://doi.org/10.1023/A:1009850119329
Barro, R. J., & Sala-I-Martin, X. (2004). Economic growth second edition (2nd ed.). Massachusetts: MIT Press.
Bhanumurthy, N., & Mitra, A. (2004). Economic growth, poverty, and inequality in Indian States in the prereform and reform periods. Asian Development Review, 21(2), 79–99.
Grossman, G. M., & Helpman, E. (1989). Growth and welfare in a small open economy (NBER Working Paper No. 2970). Cambridge, MA.
Kuznets, S. (1955). The American economic review. The American Economic Review, 45(1), 1–28.
etc.