The Effect of Financial Inclusion on Inequality Income in East Java
Abstract
This study analyzes the impact of financial inclusion on the level of income inequality 38 districts/cities in East Java from 2015 to 2021. Using the Generalized Method of Moment (GMM) analysis, its is known that financial inclusion has a negative influence on the level of income inequality in East Java. That is, the more financially inclusive in East Java, the lower the income inequality that occurs. Based on these results, the efforts that have been taken so far by the East Java government to increase financial inclusion must continue to be increased so as to reduce the level of income inequality between districts/cities in the province.
References
Adisasmita & Rahardjo. (2013). Teori-Teori Pembangunan Ekonomi: Pertumbuhan Ekonomi dan Pertumbuhan Wilayah. Penerbit Graha Ilmu.
Arellano, M., & Bond, S. (1991). Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations. The Review of Economic Studies, 58(2), 277. https://doi.org/10.2307/2297968
Banerjee, A., & Newman, A. (1993). Occupational Choice and the Process of Development. Journal of Political Economy.
Banna, H., Masud, M. M., & Rodrigo, S. K. A. (2020). How does economic growth impact on income inequality across ethnic groups in Malaysia? Poverty & Public Policy, 12(4), 397–420. https://doi.org/10.1002/pop4.293
BPS. (2022). Tingkat Ketimpangan Pengeluaran Penduduk Indonesia September 2021.
BPS Provinsi DIY & Bappeda DIY. (2020). Analisis Ketimpangan Pendapatan Daerah Istimewa Yogyakarta.
Chaussé, P. (2010). Computing Generalized Method of Moments and Generalized Empirical Likelihood with R. Journal of Statistical Software, 34(11). https://doi.org/10.18637/jss.v034.i11
Deininger, K., & Squire, L. (1996). A New Data Set Measuring Income Inequality. The World Bank Economic Review, 10(3), 565–591. https://doi.org/10.1093/wber/10.3.565
Demirguc-Kunt, A., & Klapper, L. (2012). Measuring Financial Inclusion: The Global Findex Database. The World Bank. https://doi.org/10.1596/1813-9450-6025
Erlando, A., Riyanto, F. D., & Masakazu, S. (2020). Financial inclusion, economic growth, and poverty alleviation: Evidence from eastern Indonesia. Heliyon, 6(10), e05235. https://doi.org/10.1016/j.heliyon.2020.e05235
Furceri, D., & Ostry, J. D. (2019). Robust determinants of income inequality. Oxford Review Of Economic Policy. https://doi.org/10.1093/oxrep/grz014
Greenwood, J., & Jovanovic, B. (1990). Financial development, growth, and the distribution of income. J. Polit. Econ.
Gujarati, D. N. (2003). Basic econometrics (4th ed). McGraw Hill.
Hariani, E. (2019). A Study of Factors Affecting Income Inequality in 38 East Java Districts/ Cities in 2012-2015. TIJAB (The International Journal of Applied Business), 3(1), 13. https://doi.org/10.20473/tijab.V3.I1.2019.13-23
Hilmawati, M. R. N., & Kusumaningtias, R. (2021). Inklusi Keuangan dan Literasi Keuangan Terhadap Kinerja Dan Keberlangsungan Sektor Usaha Mikro Kecil Menengah. Nominal: Barometer Riset Akuntansi dan Manajemen, 10(1), 135–152. https://doi.org/10.21831/nominal.v10i1.33881
IMF. (2021). Recovery during a pandemic: Health concerns, supply disruptions, and price pressures. International Monetary Fund.
Jauch, S., & Watzka, S. (2016). Financial development and income inequality: A panel data approach. Empirical Economics, 51(1), 291–314. https://doi.org/10.1007/s00181-015-1008-x
Kempson, E., Atkinson, A., & Pilley, O. (2004). Policy level response to financial exclusion in developed economies: Lessons for developing countries. 50.
Khoirunurrofik, & Fitriatinnisa, D. (2021). Financial Inclusion, Poverty, Inequality: Empirical Evidence from Provincial in Indonesia. 16.
Kuznets, S. (1955). Economic Growth and Income Inequality. American Economic Association, 45, 31.
Leyshon, A., & Thrift, N. (1995). Geographies of Financial Exclusion: Financial Abandonment in Britain and the United States. Transactions of the Institute of British Geographers, 20(3), 312. https://doi.org/10.2307/622654
Munandar, Y., Karlina, R., Moechtar, A., Kasim, J., Adhi, C., & Prasetya, L. M. A. (2021). Penurunan Rasio Gini Provinsi Jawa Timur pada Masa Pandemi Covid-19 Sebagai Hasil dari Penerapan Program Bantuan Pangan Non Tunai. 1.
Muslikhah, A. S., & Utami, E. D. (2020). Pengaruh Inklusi Keuangan Terhadap Ketimpangan Pendapatan di Indonesia Tahun 2012-2017. Seminar Nasional Official Statistics, 2019(1), 738–748. https://doi.org/10.34123/semnasoffstat.v2019i1.102
Pangkiro, H. A. K., Ch.Rotinsulu, D., & Wauran, P. (2016). Analisis Pertumbuhan Ekonomi Dan Kemiskinan Terhadap Tingkat Ketimpangan Di Provinsi Sulawesi Utara. Jurnal Berkala Ilmiah Efisiensi, Volume 16 No. 01.
Park, C.-Y., & Mercado, R. J. (2015). Financial Inclusion, Poverty, and Income Inequality in Developing Asia. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2558936
Pearce, D. (2011). Financial inclusion in the Middle East and North Africa: Analysis and roadmap recommendations. The World Bank. https://doi.org/10.1596/1813-9450-5610
Pradnyadewi T, D., & Purbadharmaja, I. B. P. (2017). Pengaruh IPM, Biaya Infrastruktur, Investasi Dan Pertumbuhan Ekonomi Terhadap Ketimpangan Distribusi Pendapatan Di Provinsi Bali. E-Jurnal Ekonomi Pembangunan Universitas Udayana, Vol 6.
Ray, D. (1998). Development economics. Princeton University Press.
Roodman, D. (2009). How to do Xtabond2: An Introduction to Difference and System GMM in Stata. The Stata Journal.
Sarma, M. (2008). Index of Financial Inclusion. Indian Council for Research on International Economic Relations (ICRIER), 27.
Sarma, M. (2012). Index of Financial Inclusion – A measure of financial sector inclusiveness. Competence Centre on Money, Trade, Finance and Development 1207, Hochschule fuer Technik und Wirtschaft, Berlin., Working Paper No. 07/2012. https://ideas.repec.org/p/mtf/wpaper/1207.html
Sarma, M., & Pais, J. (2008). Financial Inclusion and Development: A Cross Country Analysis. 30.
Sjafrizal. (2008). Ekonomi Regional, Teori dan Aplikasi. Baduose Media, Cetakan Pertama.
Suryani, K. G., & Woyanti, N. (2021). The Effect Of Economic Growth, Hdi, District/City Minimum Wage And Unemployment On Inequality Of Income Distribution In Province Of D.I Yogyakarta (2010-2018). Media Ekonomi dan Manajemen, Volume 36 Issue 2.
Tambunan, T. (2015). Financial Inclusion, Financial Education, and Financial Regulation: A Story from Indonesia. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2641734
Todaro, M. P., & Smith, S. C. (2012). Economic development (11th ed). Addison-Wesley.
Vandenberg, P. (2004). Productivity, decent employment and poverty.
World Bank. (2015). Meluasnya Ketimpangan di Indonesia. https://www.worldbank.org/in/news/feature/2015/12/08/indonesia-rising-divide
Wouterse, B., Geisler, J., Bär, M., & van Doorslaer, E. (2023). Has COVID-19 increased inequality in mortality by income in the Netherlands? Journal of Epidemiology and Community Health, jech-2022-219845. https://doi.org/10.1136/jech-2022-219845
Copyright (c) 2024 Vita Venia, Shochrul Rohmatul Ajija
This work is licensed under a Creative Commons Attribution 4.0 International License.
