Academy of Entrepreneurship Journal (Print ISSN: 1087-9595; Online ISSN: 1528-2686)


Poverty and Human Development: An Inter-Regional Study

Author(s): Farah Aziza, Mohamad Ichwan, Santi Yunus and M. Anwar Nasruddin

Poverty as a phenomenon of development failure is an interesting research area because it is not limited to the economic dimension alone but becomes a multidimensional problem, poverty must ultimately be monitored based on the state of health and education. This paper aims to examine the role of health which is reviewed based on life expectancy and the role of education which is reviewed based on the average length of schooling and the expected length of schooling. In an effort to identify poverty and capture the differences according to the endowment factor of each region, this paper is based on the use of panel data covering 13 regions for 8 years. Using panel data regression, a random effect model was obtained as the right model to capture variations in poverty level data in the region for 8 years. It was found that the average length of schooling pushed up the poverty rate, while the expected length of schooling suppressed the poverty rate. Although life expectancy does not significantly affect the poverty rate, in the short-term phase it is negatively related to the level of poverty and the long-term phase is positively related to the level of poverty. Longer observations are needed to better capture the phenomenon of poverty and encourage the use of logistical and probit models to estimate the parameters of the poverty level in its probability of change.

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