Nationally Accredited SINTA 2 based on the Decree of the Minister of Research, Technology and Higher Education, Number 21/E/KPT/2018. Accreditation is valid for five years Vol. 5. No. 1. 2016 - Vol 9. No. 4. 2020 Economics Development Analysis Journal starting in 2024 migrates to better secure from various unwanted things, including journal hacking and so on. To submit, the author please visit the new website page of our journal at the link https://journal.unnes.ac.id/journals/edaj MIGRATION OFFICIAL STATEMENT HERE Economic Development Analysis Journal [p-ISSN 2252-6560 | e-ISSN 2502-2725] is a scientific journal published by Department of Economic Development, Faculty of Economics, Universitas Negeri Semarang and Asosiasi Pendidikan Ekonomi LPTK. Economic Development Analysis Journal publishes original research and conceptual analysis of economic development, problems and policies in Indonesia. Abstracting/Indexing: Dimension | GARUDA | SINTA | DOAJ
Family Structure and Child Labor in Indonesia: Evidence from Widowed and Divorced Single-Mother Households
This study examines whether child labor differs between households headed by divorced mothers and those headed by widowed mothers in Indonesia. Using IFLS wave 5 data, the analysis estimates associations using an instrumental variables approach. The estimates indicate a higher likelihood of child labor among children living with divorced single mothers than among children living with widowed single mothers. The difference is larger for girls in divorced mother households relative to girls in widowed mother households. These findings support stronger enforcement of child support after divorce to reduce financial pressure on single mothers. Targeted social and psychosocial support may be especially relevant for girls in divorced mother households. Skills training and employment support for divorced single mothers may also reduce the need for children to contribute labor during schooling years
Household Structure; Child Labor; Indonesian Family Life Survey; the instrumental variable; Indonesia
Copyright (c) 2026 Economics Development Analysis Journal
Analysis of the Work Motives of Wonocolo Traditional Oil Miners
This study aims to analyze the influence of physical environmental factors (geosite) and cultural environmental factors (culturesite) on the work motivation of traditional oil miners in Wonocolo Village, Bojonegoro Regency in 2025. This research is motivated by the unique characteristics of Wonocolo traditional oil mining which is still managed traditionally and is a historical legacy from the Dutch era. In addition, the issue of developing geosites, geoparks, and sustainable economic transformation is currently an important concern in local resource-based regional development. The research subjects were traditional oil miners who were still actively working and directly involved in the production process. The study used a descriptive quantitative approach with data collection techniques through closed questionnaires using a Likert scale. The research sample was determined using the snowball sampling technique considering the informal characteristics of workers. Data analysis was carried out using the Partial Least Squares–Structural Equation Modeling (PLS-SEM) method with the help of WarpPLS software. The results of the study show that geosites have a negative and significant effect on work motivation, which indicates that increasing public awareness of the geological value and potential for regional development encourages reduced dependence on mining activities as the main livelihood. However, this condition does not necessarily make people leave their jobs as miners due to limited alternative jobs and household economic considerations. Meanwhile, culturesite does not have a significant effect on work motivation, which shows that cultural values and mining traditions have not become a dominant factor in people's decisions to work as miners. These findings indicate that economic motives are still the primary consideration for people in maintaining employment in the traditional mining sector. This research contributes to the development of geosite and culturesite-based development economic studies, and has important implications for the formulation of Wonocolo area management policies towards a more sustainable local economic transformation through the development of geotourism and alternative economies based on local potential.
Traditional Oil Mining, Mining Workers, Culturesite, Geosite
ESG, Ownership Structure, and Firm Performance: Evidence from Indonesia
Understanding how firms sustain performance under heightened uncertainty remains a prior issue in corporate finance, particularly in emerging markets characterized by institutional constraints. This study examines the effects of Environmental, Social, and Governance performance, ownership structure, and the COVID-19 crisis on firm performance in Indonesia. This study uses panel data of 39 ESG-committed listed firms over the period 2015–2024, the analysis applies static panel regression and dynamic Difference Generalized Method of Moments to address endogeneity and unobserved heterogeneity. This study shows that Environmental, Social, and Governance performance is positively associated with firm performance in Indonesia. The mean difference tests and scatter plot analysis indicate that firms with higher ESG engagement tend to exhibit higher return on assets and greater performance stability, particularly during the COVID-19 period. These patterns are confirmed by the dynamic GMM results, which reveal a positive and statistically significant effect of ESG performance on return on assets after accounting for endogeneity. The GMM estimates further show that liquidity and firm size positively influence asset-based profitability, while the COVID-19 shock exerts a negative effect on firm performance. Overall, the findings suggest that ESG integration enhances operational efficiency and functions as an effective risk-mitigation mechanism, underscoring the importance of embedding sustainability into core business strategies and strengthening ESG-related policy frameworks in emerging markets.
A Dynamic Panel Analysis of Human Development and Environmental Sustainability in Indonesia
As decentralized emerging economies navigate the complex trade-offs between rapid industrialization and ecological preservation, understanding the nuanced drivers of environmental sustainability becomes critically imperative. This study investigates the dynamic interplay between human development and environmental quality across 34 Indonesian provinces from 2013 to 2020. Recognizing that regional ecological trajectories are highly path-dependent and that traditional static panel models frequently yield biased estimates, we employ a System Generalized Method of Moments (GMM) approach. This methodological framework rigorously addresses the inherent endogeneity and reverse causality between macroeconomic expansion and environmental outcomes. The model incorporates Foreign Direct Investment (FDI), physical capital, economic growth, and population as control variables, all of which exhibit negative coefficients, suggesting that current macroeconomic expansion and demographic pressures pose significant challenges to regional environmental quality. Despite these pressures, the research novelty reveals that human development dimensions particularly education and welfare—act as critical countervailing forces. Our findings confirm that while industrial and population scaling currently degrade the environment, qualitative improvements in human capital can catalyze a transition toward green growth. Policy implications suggest that Indonesia must shift from a 'grow first, clean up later' strategy toward selective FDI screening and 'green-weighted' development metrics to decouple economic progress from ecological decline.
Environmental Quality; Human Development; Environmental Austainability; System GMM
Spatial Effects of Logistics Infrastructure on Interregional Growth in Indonesia
This study aims to analyze the impact of logistics infrastructure, physical capital growth, human capital, and population growth on interregional economic growth in Indonesia from 2014 to 2023, and to evaluate the presence of interregional spillover effects. The analysis uses panel data of 34 provinces with a Spatial Durbin Model (SDM) under a fixed effect approach. The results indicate that the effect of logistics infrastructure varies across types and regions: road length consistently shows a positive and significant effect, whereas airports and seaports tend to have negative effects, especially in Eastern Indonesia. The land transport (trucks) contributes positively, though significance varies across regions. Spatial analysis indicates heterogeneous spillover effects: roads generate positive spillovers, while airports, seaports, and truck may produce negative spillovers in certain regions. Physical capital has a relatively small and insignificant direct effect, whereas human capital shows positive and significant effects, particularly in Eastern Indonesia. Population growth has a directly negative effect in Eastern Indonesia, but total effects can be positive through labor mobility and interregional market integration. These findings highlight the importance of improving the quality and efficiency of logistics infrastructure, spatially based development planning, and affirmative policies to support more equitable economic growth
E-Commerce Road Map and Equal Digital Opportunity in Indonesia
Understanding the program's impact on digital capability growth is considered necessary to support progress in digital inclusion through measured evaluation. This study seeks to understand the influence of regulation on the level of digital opportunity and its growth in Indonesia. Utilizing a descriptive-comparative analysis with the Digital Opportunity Index framework, this study measures digital opportunity through e-commerce among Small and Medium Enterprises across 34 provinces. The results show that while the DOI score at the national level remained stagnant, 21 provinces experienced growth, 12 provinces experienced negative growth, and 1 province remained unchanged. Furthermore, in the opportunity category, 26 provinces and the national level experienced growth, while the other 8 provinces experienced zero growth. The infrastructure category showed that 6 provinces experienced growth, 27 provinces and the national level presented negative growth, and 1 province showed zero growth. The utilization category showed that 33 provinces and the national level experienced positive growth, leaving only one province with negative growth. This research suggests that, to provide continuous support for digital development, the government and related institutions should consider regulations or programs that promote infrastructure development, ensuring it is available and affordable at the provincial level.
SAW-GIS Analysis: Economic Potential of Batik MSME’s in Surakarta
Surakarta is the national center of the batik industry; however, its growth has not been supported by comprehensive spatial-economic mapping, resulting in overly general development policies. This study analyzes the economic potential of batik MSMEs in Surakarta using the Simple Additive Weighting (SAW) method and Geographic Information Systems (GIS). Unlike descriptive approaches, this study introduces a quantitative framework to measure potential based on three related variables: distance (accessibility), product completeness (competitive advantage), and price (market equilibrium). The SAW method is applied to determine development priority rankings. The results indicate that 53.7% of MSMEs fall into the high-priority category, 37% into the medium-priority category, and 9.3% into the low-priority category. These findings suggest that batik development in Surakarta requires differentiated strategies based on regional typologies. This study contributes to the development of a visual database and decision-support tools for local governments to formulate appropriate location-based empowerment programs. The integration of SAW and GIS provides a robust economic-spatial perspective, ensuring that development policies account for both geographical and competitive factors simultaneously. This approach offers practical contributions to MSME digitalization and regional economic planning, particularly for traditional industries transitioning into a digital ecosystem.
Batik MSMEs Surarkarta, Simple Additive Weighting, Geographic Information System
The Role of Government Spending in Water Pollution Control
The global clean water crisis is an urgent challenge. Althought the water stress level in most provinces in Indonesia remains low, the water quality index does not reach good status. Water quality index calculated through pollution index of surface water. This study examines how environmental protection spending by local governments defined as the combined spending of provincial and regency/municipality governments within each province affects the water quality index in Indonesian provinces, and compare it with central government spending and non-government spending. Government spending has three effects on water pollution: scale, composition, and technique effects. These three effects are expected to follow a quadratic pattern. Using provincial panel data from 2017 – 2022, this study estimates these with fixed effect model. Initially, the estimation uses quadratic specification on local government spending, but likelihood ratio test shows that the quadratic term does not improve model fit, so the analysis proceeds with the linear specification. The results show that local government spending and non-government spending increase the water quality index, but central government spending is not significant due to its long-term effects. Non-government spending is more effective than government spending. Therefore, the local government should enforce regulations on businesses/ local-owned enterprises that use surface water to make efforts to maintain water sources. In addition, the local government needs to consider the development of a localized wastewater management system but still considering the necessary technical matters.
How Literacy and Savings Link Digital Finance to Sustainability?
This study analyzes how digitalization, financial inclusion, and financial literacy affect business savings and the sustainability of culinary Micro, Small, and Medium Enterprises (MSMEs) in Central Java, Indonesia. Data from 210 MSME owners were examined using Partial Least Squares–Structural Equation Modeling (PLS-SEM). The results show that digitalization and financial inclusion significantly increase business savings, thereby enhancing MSME sustainability. Financial literacy does not directly affect sustainability but moderates the relationship between savings and sustainability, strengthening the effectiveness of savings utilization. The model shows strong explanatory power, with R² values of 0.37 for business saving and 0.90 for sustainability. The Importance–Performance Map Analysis identifies financial literacy and digitalization as highly important yet moderately performing variables, marking them as priorities for policy development. Overall, the findings highlight that MSME sustainability in Central Java depends on integrating digital finance, inclusive access, and sound saving behavior, supported by financial literacy. The study provides policymakers and financial institutions with practical insights for designing integrated digital finance and literacy programs that strengthen MSME resilience and regional economic growth.
Economic Viability of Community Gardens in Semarang City
Numerous studies have shown that urban agriculture makes substantial contributions to poverty reduction, reduces unemployment, and improves food security. Unfortunately, research on the profitability and economic viability of urban agriculture remains limited. This research aims to explore the economic viability of community gardens as a form of urban agriculture in Semarang City, Indonesia. Semarang city was chosen due to its active implementation of urban farming programs initiated by the municipal government. The research employed a qualitative approach involving 24 participants spread across all sub-districts in Semarang. Data were collected through questionnaires, in-depth interviews, observations, and documentation. Thematic was applied to explore the research findings with the help of NVivo 12 Pro software. The findings indicate that most community gardens operate at a financial loss, showing weak economic viability. Even so, they continue to function sustainably, driven not by profit but by government programs, social cohesion, and environmental concern. This reveals a paradox: community gardens may not generate a profit, yet they remain socially sustainable – sustained more by policy than by market forces. These findings suggest that their sustainability relies more on institutional and communal support than on profit generation. Strengthening government facilitation and community empowerment is essential to ensure their long-term continuity.
economic viability of urban agriculture; community garden; poverty and food security; urban farming for sustainable development goals; household income
Copyright (c) 2025 Economics Development Analysis Journal
Household Consumption, Inequality, and the Diffusion of E-Cigarettes in Indonesia
Tobacco use remains one of Indonesia’s significant public health burdens, and the rapid growth of electronic cigarettes (e-cigarettes) introduces new regulatory challenges. Data from the 2018 Basic Health Research Survey (Riset Kesehatan Dasar; RISKESDAS) show that adolescent e-cigarette use increased sharply from 1.2% in 2016 to 10.9% in 2018. Drawing on consumer behaviour theory and the diffusion of innovations framework, this study examines how household consumption, income inequality, poverty, unemployment, and demographic factors influence e-cigarette uptake in Indonesia. Using nationally representative data from the 2023 National Socio-Economic Survey (Survei Sosial Ekonomi Nasional; SUSENAS), this study applies logistic regression and accounts for clustering at the provincial level. The results indicate that higher household consumption significantly increases the likelihood of e-cigarette use. Income inequality exhibits a strong positive association, suggesting diffusion driven by more affluent adopters, whereas unemployment and poverty show negative but statistically insignificant effects. E-cigarette adoption remains concentrated among men and urban residents. Overall, the findings indicate that the diffusion of e-cigarettes in Indonesia reflects underlying socioeconomic disparities. These results underscore the importance of policies addressing affordability and marketing practices—such as excise taxation, price floors, and integrated regulatory frameworks—to mitigate the expansion of nicotine-related inequalities and Indonesia’s existing tobacco burden.
Institutional Quality, Financial Stability, and FDI Dynamics in Asia
This study aims to analyze how institutional quality and financial stability influence foreign direct investment (FDI) in Asian countries, examining differences across country income groups. This study utilizes data from 39 Asian countries spanning the years 2013 to 2021. The analytical tool used is the Generalized Method of Moments (GMM), consisting of first-difference GMM and system GMM. Furthermore, this study uses principal component analysis (PCA) to calculate composite variables related to the institutional quality index. The results show that institutional quality and financial stability have a positive overall impact on FDI in Asian countries. However, the impact varies depending on the country's level of income. Institutional quality has a more significant impact in high-income countries, while in lower-middle-income countries, economic growth is the primary determinant of FDI. These findings emphasize the importance of improving governance and financial stability in attracting foreign investment. Governments, particularly in lower-middle-income countries, need to strengthen law enforcement, reduce corruption, maintain political stability, and create regulations that support an investment climate to make it more attractive to foreign investors
Efficiency of Conventional Vs Islamic Banks in Indonesia: Pre and Mid-Covid Analysis
This study aims to assess the technical efficiency of Indonesia’s conventional and Islamic banks and to examine whether their efficiencies differ between the periods before and during the COVID-19 pandemic. Bank input and output data are obtained from financial statements sourced from the CEIC Global Database for 96 Indonesian banks over the period from 2015 to 2022. The study employs bootstrap Data Envelopment Analysis (DEA) under both production and intermediation approaches to estimate bias-corrected technical efficiency. Independent t-tests are conducted to compare efficiency scores between conventional and Islamic banks, as well as to examine differences in technical efficiency before versus during the COVID-19 pandemic. The empirical findings indicate that Indonesian banks during the pandemic period were generally less efficient than before, and Islamic banks consistently exhibited lower technical efficiency than conventional banks. Although conventional banks outperform Islamic ones overall, the efficiency gap is not statistically significant during the pandemic. Moreover, banks show higher efficiency under the production approach, indicating stronger performance in revenue generation than fund intermediation. This study advises Indonesian banks to increase interest income (or fund disbursements, for Islamic banks), non-interest income, and loans while also considering risk to improve overall technical efficiency.
Government Foreign Debt and Macroeconomic Stability in Indonesia
This study examines the short- and long-run relationships between Government Foreign Debt (GFD) and Indonesia’s macroeconomic stability using the Vector Error Correction Model (VECM) and annual time-series data covering the period 1995–2024. The analysis incorporates five key variables: Government Foreign Debt (GFD), inflation, economic growth, the exchange rate, and investment. Data were obtained from Statistics Indonesia (BPS), Bank Indonesia, the Ministry of Finance, and relevant international publications. The VECM framework was employed following unit root and cointegration tests to capture both the long-run equilibrium relationships and the short-run dynamic adjustments among the variables. The estimation results indicate that GFD exerts significant long-run effects by increasing inflation, depreciating the exchange rate, and constraining economic growth. In the short run, however, its effects are more limited, although debt-financed fiscal spending may provide temporary support for economic activity. The Impulse Response Function (IRF) analysis further shows that shocks to GFD generate negative responses in economic growth and investment while increasing inflation and causing exchange rate depreciation. Variance Decomposition (VD) results demonstrate that the contribution of GFD to fluctuations in economic growth, inflation, and the exchange rate becomes increasingly substantial over time. Overall, the findings suggest that Government Foreign Debt plays a critical yet potentially risky role in maintaining macroeconomic stability. Therefore, prudent debt management should prioritize productive long-term financing to minimize external vulnerabilities, maintain fiscal sustainability, and strengthen long-term macroeconomic stability
Government Foreign Debt, Macroeconomic Stability, VECM, Impulse Response Function, Variance Decomposition.
Halal MSME Sustainability: Digital Marketing, Innovation, and Islamic Economics Synergy
This study examines the effects of digital marketing strategy and halal innovation on the sustainability of halal micro, small, and medium enterprises (MSMEs), with Islamic economic implementation as a mediating variable and Sustainable Development Goals (SDGs) orientation as a moderating variable. The research was conducted among 160 halal-certified MSMEs in six regions of Central Java (Banyumas, Purbalingga, Banjarnegara, Cilacap, Kebumen, and Brebes), using a quantitative approach and Partial Least Squares Structural Equation Modeling (PLS-SEM). The findings provide mixed empirical support. Halal innovation demonstrates a positive and statistically significant effect on MSME sustainability. In contrast, the digital marketing strategy shows a positive but statistically insignificant direct relationship. Islamic economic implementation plays a limited, marginal mediating role in the relationship between halal innovation and sustainability. Furthermore, SDGs orientation does not significantly moderate the proposed structural relationships. These results suggest that halal innovation serves as the primary driver of sustainability. In contrast, digitalization and alignment with global sustainability appear not yet strongly embedded in the strategic practices of the sampled halal MSMEs. The study contributes by clarifying the empirical boundaries of integrating digital strategies, halal innovation, and Islamic economic values within MSME sustainability frameworks in emerging economies
Islamic economy, halal innovation, MSME sustainability
Demographic Drivers of Labor Migration and Their Impact on Rural-Urban Development
Rural-urban labor migration serves as a pivotal driver of local development transformation in developing countries, encapsulating demographic shifts and reshaping economic structures via remittances. This study investigates demographic factors influencing migration patterns in Malang Regency, East Java, Indonesia, and their ramifications for sustainable rural-urban development, emphasizing remittances as a key economic contribution metric. A mixed-methods design was employed, gathering data from migrant workers across five high-migration subdistricts through purposive sampling, with questionnaires facilitating quantitative analysis and in-depth interviews providing qualitative depth. Multinomial logistic regression evaluated settlement intentions, multiple linear regression examined income determinants, and descriptive statistics delineated migrant profiles. Findings reveal that age, education, and marital status exert significant negative effects on settlement intentions, whereas education positively impacts income; factors such as family responsibilities and work tenure proved insignificant. Descriptively, most migrants exhibit no settlement intent, characterized by low education levels, productive ages, and strong origin asset ties, thereby reinforcing circular migration dynamics. These outcomes underscore migration's transient character aimed at enhancing family welfare, highlighting the imperative for policies promoting rural education investments, informal sector formalization, and remittance optimization to cultivate equitable, inclusive development while averting long-term depopulation risks.
Development; city economy; competitiveness; leading sectors; specialization.
Household Carbon Footprint: How Does Age Structure Affect Emissions?
This study analyzes the influence of household age structure on carbon emissions in Indonesia using a quantitative approach based on micro-level survey data. Employing an Ordinary Least Squares (OLS) regression model, it introduces the average age of household members and its squared term to capture potential non-linear effects. The results reveal a non-linear, inverted U-shaped relationship between household age and per capita carbon emissions. The turning point occurs at approximately 36 years, suggesting that households with members around this average age tend to have the highest emissions, which then decline as the average age increases further. This finding aligns with the Life-Cycle Hypothesis, which posits that households in their productive years exhibit more energy-intensive consumption patterns. In addition, the study explores variations in emissions across different household age compositions those dominated by children, adults, and elderly structures. By incorporating these classifications, along with relevant socio-economic and physical household characteristics, the analysis provides deeper insights into how demographic profiles shape energy use and emissions. These findings offer valuable input for developing more targeted and equitable low-carbon policy interventions.
Circular Economy in Waste Bank for Sustainability and Empowerment
This research aims to develop an integrative conceptual model that connects the circular economy, waste bank optimization, community empowerment, and sustainable economy. The novelty of this study lies in integrating digital incentive systems and participatory approaches in community-based waste management. The method employed was a mixed-methods approach, incorporating a quantitative component that utilized SEM-PLS on 200 respondents, complemented by qualitative data from in-depth interviews. The results indicate that community empowerment and the digitalization of waste bank systems have a significant impact on the sustainability of the local economy. Theoretically, this research strengthens the capabilities (Sen) and environmental economics (Pearce & Turner) approaches and practically offers a data-driven local policy framework for waste management optimization. The resulting model can serve as a reference for informed decision-making at the regional level, integrating environmental, social, and economic aspects sustainably.
Circular Economy, Waste Bank, Sustainable Economy, Community Empowerment
Post-Pandemic MSME’s and Sustainable Development in Solo City
Micro, Small, and Medium Enterprises (MSMEs) play a pivotal role in Indonesia’s economy, accounting for approximately 60% of the national GDP and employing 97% of the workforce. However, the COVID-19 pandemic severely disrupted MSME sustainability, particularly in Solo, thereby impacting their contribution to the Sustainable Development Goals (SDGs). This study explores the role of MSMEs in advancing the SDGs and identifies the challenges they face. Employing a qualitative case study approach, data were collected through in-depth interviews with 15 purposively selected MSME actors. Thematic analysis revealed that MSMEs contribute significantly to SDG 8 (Decent Work and Economic Growth) by sustaining employment, to SDG 9 (Industry, Innovation, and Infrastructure) through digital adaptation, and to SDG 10 (Reduced Inequalities) by promoting inclusive entrepreneurship. Despite these contributions, MSMEs continue to face obstacles, including declining revenues, restricted access to financing, and supply chain disruptions. The findings underscore the need for targeted policy interventions, including streamlined financial access, capacity-building initiatives, and infrastructure support. Strengthening digital literacy and fostering collaborative business ecosystems are essential strategies to enhance the resilience and long-term sustainability of MSMEs in the post-pandemic recovery phase
Accountability, Role, Village Government, Village SDGs
Crime Traps in Inclusive Economic Development
Increased crime is frequently assumed to be an unavoidable consequence of economic growth and development. The impact of criminal activity creates new challenges within the community. The purpose of this research is to investigate how criminal activities affect Indonesia's inclusive economic development. Panel data using the Least Squares Dummy Variable (LSDV) method covering 34 Indonesian provinces from 2018 to 2022 were used in this research. The findings indicate that the specific types of crime, namely crimes against decency, crimes against freedom of the person, and crimes against public order, notably influence inclusive economic development. The findings indicate that crimes against life, crimes including embezzlement, fraud, and corruption; crimes against property, both violent and non-violent; crimes related to narcotics; and crimes against physical bodies do not exert a significant influence on inclusive economic development. This study underscores the necessity of a comprehensive strategy that prioritizes crime-prevention tactics and involves a variety of stakeholders to address the underlying causes of criminal activity.
Export Strategy Development in Micro and Small Enterprises of The Craft Sector in Central Java
This study examines which factors most strongly drive export participation among craft-sector micro and small enterprises (MSEs) in Central Java. Focusing on batik, furniture, and leather products, we highlight a capability-first perspective that has been underexplored in this context. Using a survey of craft MSEs analyzed with logistic regression, we compare the effects of human capital (export knowledge and skills) with commonly cited enablers such as capital and government assistance. The results show that export knowledge and skills consistently predict export participation, whereas financial inputs and generic assistance are not decisive once capabilities are considered. These findings suggest that policies and firm strategies should prioritize practical export know-how, skills development, and market-readiness over undifferentiated financing. The study contributes evidence from Indonesia’s craft sector that human capital is the primary lever for scaling MSEs to international markets. The skills possessed in the Craft sector in Central Java regarding exports have a positive influence on their performance with a coefficient value of 5.76; this indicates that if the skills of MSEs in the Craft sector in Central Java increase by 1%, it will increase MSEs performance by 5.76%.
Rational and Irrational Factors Influencing Bank Stock Prices: GMM Approach
In the dynamic and volatile capital market, understanding the factors that influence stock prices is essential for making informed investment decisions. Stock price movements are influenced by rational, fundamental information, irrational investor behavior, and sentiment. This study aims to analyze the influence of rational and irrational factors on stock prices in the Indonesian banking sector during the 2020-2024 period. The rational variables include price-to-book value (PBV), financial literacy, technology adoption, and interest rates, while irrational influence is represented by investor sentiment or mood. Using a dynamic panel data approach with the Generalized Method of Moments (GMM), this study examines four major Indonesian banks: Bank Mandiri, BNI, BRI, and BCA. The results show that PBV, financial literacy, and technology adoption significantly affect stock prices, while interest rates have a significant negative effect. Additionally, investor sentiment has a considerable positive impact, indicating that emotional and psychological factors can drive stock price movements beyond fundamental valuation. This research presents a novel analytical model that integrates rational and irrational perspectives, offering a comprehensive understanding of stock price volatility in emerging markets. It suggests that investors, companies, and policymakers must consider both fundamental indicators and market sentiment simultaneously to make accurate, timely investment decisions.
Price-to-Book Value, Financial Literacy, Technology Adoption, Interest Rate, Investor Sentiment, Stock Price
Village Funds and Village Development: The Case of West Java
The Village Fund program has enabled the widespread implementation of village development initiatives that involve local communities as the subjects of development (i.e., Community Driven Development) across various countries, including Indonesia. Despite receiving substantial village funds, West Java, one of Indonesia's provinces, exhibits slow growth in the Village Development Index (IDM). This study examines the effect and impact of Village Funds on achieving the Sustainable Development Goals (SDGs), as measured by the IDM in West Java Province. The methodology employs a panel data regression with fixed effects and a Difference-in-Difference (DiD) analysis on 5,312 villages that received Village Funds between 2018 and 2023. Findings indicate that Village Funds significantly impact the IDM, primarily through infrastructure projects within the village development sector. Furthermore, the regression analysis revealed that all sectors positively and significantly influence the IDM, particularly the village development implementation sector. Conversely, the DiD analysis suggests that the alignment of Village Fund activities with the SDGs has not significantly affected IDM growth in West Java. Thus, to accelerate village development, the government must balance the prioritization of Village Funds. This balance should move beyond solely focusing on infrastructure development to encompass activities in other fields, such as village community empowerment
Digital Transformation: HDI, Consumption, And Inclusive Economic Growth Link
This research investigates the impact of digital transformation on inclusive economic growth in Indonesia, in light of significant social and economic inequality. While previous studies, particularly in South Africa, have highlighted opportunities for market access, this study focuses on identifying the factors that influence the contribution of digital transformation within the Indonesian context, using Prakash’s theory. A quantitative descriptive approach was employed, utilizing secondary data from the Central Statistics Agency across ten provinces in Sumatra. The analysis applied the Panel Vector Autoregressive (PVAR) method to examine the relationships among variables, including the Human Development Index (HDI), consumption, and social inequality. The findings indicate that, in the long term, both consumption and HDI have a negative impact on inclusive economic growth, with t-statistics of -2.452 and -5.093, respectively. Inequality, however, did not show a significant influence, with a t-statistic of 1.148. Similar trends were observed in the short term. The study concludes that a nuanced understanding of the equitable implementation of digital technology is essential for achieving inclusive economic growth. Notably, the negative influence of HDI on economic inclusion suggests that improvements in quality of life do not always correlate directly with economic growth, offering new insights into the discourse on digital transformation and economic inclusion in Indonesia.
Determinants and Potential of Indonesia’s Frozen Shrimp Exports
This study examines the main factors influencing the flow of Indonesian frozen shrimp exports and explores opportunities to strengthen trade with key destination countries. The research uses a panel data regression approach, including estimation and potential analysis, focusing on 12 major trading partners from 2012 to 2023. The study analyzes frozen shrimp under HS code 030617, one of Indonesia's leading fishery export commodities. The findings show that importer gross domestic product, importer population, and revealed comparative advantage positively influence frozen shrimp exports. In contrast, Indonesia's gross domestic product, economic distance, and non-tariff barriers have a negative impact. Based on the regression results, the potential analysis identifies several countries with strong export prospects, including Australia, the Netherlands, Hong Kong, the United Kingdom, Japan, Germany, Canada, South Korea, Malaysia, France, and Singapore. These results provide meaningful managerial implications, such as increasing domestic production capacity, enhancing export competitiveness, and developing focused marketing strategies to penetrate high-potential markets.
A Spatial Econometric Approach on Addressing Determinants of Regional Inequality
The disparity in socioeconomic conditions across Banten Province is suspected to contribute to regional inequality, stemming from uneven economic development. This is evidenced by certain areas with significantly higher economic levels than others. This study uses correlational and spatial approaches to analyze the influence of these socioeconomic conditions on the high level of regional inequality in Banten Province. The socioeconomic variables examined include the Human Development Index (HDI), labor force participation rate, poverty rate, base economic sector, and economic growth. The findings indicate that the poverty rate significantly correlates with regional inequality in a non-spatial context. Meanwhile, the base economic sector (particularly manufacturing) and economic growth show significant spatial effects on regional inequality.
The Impact of MSME’s on Employment, Investment, and Income
North Sumatra, a key economic region in Indonesia outside of Java, continues to face persistent challenges such as high unemployment, the dominance of the informal sector, and uneven economic growth. Within this context, Micro, Small, and Medium Enterprises (MSMEs) serve as a cornerstone of the regional economy, particularly through their role in labor absorption and income generation. Despite their significance, MSMEs in North Sumatra still face substantial obstacles, including limited access to financing, inconsistent investment growth, and inadequate policy implementation—factors that hinder their full potential in driving inclusive development. This study examines the dynamic relationship between MSME growth, workforce participation, and Gross Regional Domestic Product (GRDP) in North Sumatra, employing a simultaneous equation model with time-series data from 2009 to 2023. The Two-Stage Least Squares (2SLS) method addresses endogeneity and simulates the effects of policy interventions projected for the 2025–2030 period. The findings indicate that MSME development is significantly influenced by policy instruments such as tax incentives and minimum wage regulations. Increases in wages and tax reductions enhance labor absorption, stimulate MSME performance, and promote GRDP growth. The study provides practical policy insights for strengthening the resilience and sustainability of MSMEs within North Sumatra’s evolving economy.
The Role of Family Support in Combating Social Disconnection
This study examines the role of family relationships in mitigating social disconnection, specifically feelings of lacking friendships, being left out, and experiencing isolation. A logit regression analysis was employed using nationally representative data from the 2021 Indonesian Happiness Survey. The study measured three dimensions of family support: communication frequency, shared family activities, and perceived family harmony. Findings indicate that frequent communication and family togetherness significantly reduce the likelihood of experiencing loneliness. In contrast, perceived family harmony exhibited a weaker effect. These results suggest that the quantity of family interactions is more critical than their perceived quality in alleviating social disconnection. The study highlights the importance of family engagement and communication as effective strategies for combating loneliness and enhancing individual well-being.
Stakeholder Engagement: Development of Sustainable Tourism Based on Local Wisdom
The development of sustainable tourism in Pati Regency, grounded in local wisdom, has been hindered by several factors, including structural ego issues, overlapping policies, and inadequate stakeholder collaboration. This study analyzes efforts to support tourism development, examines the impact of various variables (factors), and assesses the influence of stakeholders (actors) in sustainable tourism initiatives based on local wisdom in Pati Regency. The methodology integrates qualitative and quantitative approaches, employing the MICMAC and MACTOR methods. MICMAC analysis identifies core variables such as uniqueness and historical value, regional income, stakeholder relationships, community involvement, and utilizing local wisdom in tourism development. MACTOR analysis reveals key stakeholders namely, the Tourism and Culture Office (Dinporapar), the Cooperative and Small and Medium Enterprises Office (Dinkop), and the local community as central actors in sustainable tourism development. The findings from the MICMAC and MACTOR analyses provide a basis for formulating a comprehensive strategy to accelerate sustainable tourism development rooted in local wisdom in the Pati Regency. Further research may incorporate additional external variables and stakeholders to support advancing tourism models based on local creative economy initiatives.
Mediating Role of Oil Production in Non-Tax State Revenue Determinants
This study aims to analyze the effect of the Indonesian Crude Price (ICP) and upstream oil and gas state-owned assets on oil non-tax state revenue from the oil and gas sector, with oil production considered as a potential mediating variable. Using the Vector Autoregression (VAR) model, the study examines short-run relationships through Granger causality and t-statistics, as well as long-term contributions via Forecast Error Variance Decomposition (FEVD). The results show that the ICP has a positive and statistically significant effect on oil non-tax state revenue. In contrast, upstream oil and gas state-owned assets and oil production do not exhibit significant short-run effects. Moreover, oil production does not function as a mediator in the relationship. Nonetheless, FEVD results suggest that the ICP and oil production make meaningful long-term contributions to oil non-tax state revenue, indicating underlying structural links not captured by short-run causality. These findings highlight the importance of managing oil price fluctuations and designing fiscal structures that are responsive to global oil market dynamics.