Income Inequality in Sulawesi Island: Evaluating Role of GRDP per Capita and Human Development Index

Sukmatica Slamet (), Nursin Nursini, Fatmawati Fatmawati and Sabir Sabir
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Sukmatica Slamet: Hasanuddin University, Economic Doctoral Program Student, Postgraduate Faculty of Economics and Business
Nursin Nursini: Hasnuddin University, Faculty of Economics and Business
Fatmawati Fatmawati: Hasnuddin University, Faculty of Economics and Business
Sabir Sabir: Hasnuddin University, Faculty of Economics and Business

A chapter in Proceedings of the 9th International Conference on Accounting, Management, and Economics 2024 (ICAME 2024), 2025, pp 164-177 from Springer

Abstract: Abstract This study comprehensively analyzes the effect of GRDP per capita and Human Development Index (HDI) on income inequality in six provinces in Sulawesi Island during the period 2010-2023, using a panel data approach with the Random Effect Model (REM) method. The results show that GRDP per capita has a negative and significant effect on income inequality, where an increase in GRDP per capita correlates with a decrease in the gini ratio by 0.33%. In contrast, HDI has a positive and significant effect, where each increase in HDI causes an increase in income inequality by 1.204%. With a coefficient of determination (R2) of 41.15%, this study shows that the combination of GRDP per capita and HDI contributes significantly to the variation in income inequality in the study areas. This finding underscores the importance of policy strategies that focus on economic diversification and improving access to education and equitable health services as concrete steps to reduce income inequality in Sulawesi Island.

Keywords: Income Inequality; GRDP per capita; HDI; Gini Ratio (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-758-8_16

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DOI: 10.2991/978-94-6463-758-8_16

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