Indonesia’s Changing Economic Geography

Hal Hill, Budy Resosudarmo and Yogi Vidyattama

No 200713, Working Papers in Economics and Development Studies (WoPEDS) from Department of Economics, Padjadjaran University

Abstract: Indonesia is the world’s largest archipelagic state, and one of the most spatially diverse nations on earth in its resource endowments, population settlements, location of economic activity, ecology and ethnicity. The regional socio-economic data base now extends over 30 years, and so it is possible to draw conclusions about the country’s regional development dynamics since the 1970s. In this paper, we examine economic growth, inequality, convergence, structural change and social indicators for a consolidated group of 26 provinces, ie, the 27 of the late Soeharto period excluding East Timor. Our major conclusions include the following: (a) There continues to be great diversity in economic and social outcomes, but growth and social progress have been remarkably even. The poorest regions, mainly located in Eastern Indonesia, have generally performed about as well as the national average. (b) The better performing regions are typically those that are the most ‘connected’ to the global economy. In this respect, Jakarta stands out as a special case, growing richer than the rest of the country over time. (c) As expected, conflict is particularly harmful to economic development, as illustrated in the case of Maluku and to a lesser extent Aceh. (d) There is no clear natural resource story, in that the performance of the resource-rich provinces has varied considerably.

Keywords: Economic Geography; economic growth; convergence; Indonesia (search for similar items in EconPapers)
JEL-codes: R0 R1 (search for similar items in EconPapers)
Pages: 49 pages
Date: 2007-11, Revised 2007-11
New Economics Papers: this item is included in nep-geo and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Related works:
Journal Article: INDONESIA'S CHANGING ECONOMIC GEOGRAPHY (2008)
Working Paper: Indonesia's Changing Economic Geography (2008)
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