The Influence of MSME Performance and Inclusive Finance on Poverty Reduction in Indonesia

Agustina Suparyati (), Nurhayati Nurhayati, Sumiyati Sumiyati and Astrid Maria Esther
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Agustina Suparyati: Trisakti University Jakarta, Applied Finance Undergraduate Study Program, Faculty of Economics
Nurhayati Nurhayati: Trisakti University Jakarta, Applied Finance Undergraduate Study Program, Faculty of Economics
Sumiyati Sumiyati: Trisakti University Jakarta, Applied Finance Undergraduate Study Program, Faculty of Economics
Astrid Maria Esther: Trisakti University Jakarta, Applied Finance Undergraduate Study Program, Faculty of Economics

A chapter in Proceedings of the International Conference on Entrepreneurship, Leadership and Business Innovation (ICELBI 2022), 2023, pp 32-39 from Springer

Abstract: Abstract The purpose of this study is to analyze the effect of MSME performance, financial inclusion, economic growth, and income distribution inequality on poverty levels in 33 provinces in Indonesia during the 2016–2021 period. MSME performance is measured by the level of internal efficiency as measured by the ratio of added value to the input value of a company. The financial inclusion variable is the result of a composite index calculated based on the ratio between the Financial Inclusion Index (IFI) which is a composite index of 3 components consisting of the Banking Service Penetration Index, Service Availability Index, and Banking Service Usage Index. The panel data model chosen is the random effect model. The results of panel data regression show that the performance of MSMEs, Financial Inclusion, and economic growth have a significant adverse effect on the poverty level. In contrast, the inequality of income distribution has a positive effect on the poverty level.

Keywords: MSME Performance; Financial Inclusion; Economic Growth; Inequality; Poverty (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-350-4_4

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DOI: 10.2991/978-94-6463-350-4_4

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