Measuring the Impact of Microfinance on Child Health Outcomes in Indonesia

Microfinance has become a staple of modern development policy as a means to facilitate anything from gender equality to growth. It can facilitate the sharing of health-related information among parents, promote the bargaining power of women in the household, aid in the development of important health-related infrastructure, and help households smooth consumption in the wake of unexpected economic shocks. Using data from the Indonesian Family Life Survey (1993–2000), we find that the presence of microfinance institutions in communities significantly improves the health of children.     

Decentralisation in Indonesia

This paper attempts to assess the extent of decentralisation efforts and their impact on various dimensions of the development process. We find relatively little ‘real’ decentralisation (devolution): local governments have little tax autonomy and central priorities tightly constrain most funding from the centre. Indeed, increased revenue flows serve as a disincentive to modest local tax efforts, reduce the relative importance of locally controlled funds and thus retard real decentralisation. Central transfers for health, education and infrastructure have nonetheless significantly improved social and economic indicators. Greater local control over funds is found to lead to more expenditure on the social sectors (and within them on priority areas), and to increase spending on small scale locally oriented infrastructure. More decentralisation thus offers the potential for increased allocations to social and economic priorities, enhancing efficiency and equity within regions; but the promotion of national standards and equity across regions requires central government action.     

Property-Price Determinants in Indonesia

Price formation provides critical insights into the attributes of fledgling property markets in developing countries. This article investigates asking-price formation across the Indonesian archipelago, including previously unstudied regional property markets. We compile a rich micro dataset of asking prices for residential, commercial, and undeveloped land from a nationwide classifieds database. Through a hedonic price analysis we identify the impact of property and advertisement attributes on asking prices for each type of property, using spatial fixed effects to control for spatially correlated unobservable characteristics at the district and city levels. Results indicate that property characteristics, land ownership status, and advertising method are all statistically significant indicators of asking price. We find considerable heterogeneity in asking-price formation in residential, commercial, and undeveloped land, and identify key differences between urban and rural markets.     

Anti-Poverty Programs in Indonesia

Between 1994/95 and 1997/98, Indonesia's spending on anti-poverty programs grew from 0.1% to 0.3% of GDP. The introduction of the 'social safety net' raised anti-poverty spending to 1.4% of GDP in 1998/99 and changed its main focus from job creation schemes, financed mainly by loans and grants to small firms and community groups, to in-kind subsidies for rice, public health care, scholarships for children in poor families and grants to schools in poorareas. The most accurately targeted program was health care, which covered twice as many people in the two poorest deciles as in the remaining eight. For most other programs, this targeting ratio was only about 1.5. We argue that the education and health care programs were the most successful, and doubt that the rice subsidy, job creation and loans schemes were worthwhile.     

Dollarising Indonesia

The rupiah's record of instability, both recently and over the long term, suggests it is worthwhile to investigate options for radical monetary reform. An option currently receiving attention elsewhere is official dollarisation, under which a country ceases to issue a domestic currency and makes a foreign currency its official currency. This paper discusses the costs and benefits of dollarisation in Indonesia, the steps involved in dollarisation, and some economic and political implications of dollarisation.     

Indonesia Update 2010 Employment,living standards and poverty in contemporary Indonesia

The Indonesia Update Conference, now in its 28th year, was held at the Australian National University on 24–25 September. Convened by Chris Manning (Indonesia Project, ANU) and Sudarno Sumarto (SMERU Research Institute, Jakarta), the conference attracted around 300 participants from academia, government, NGOs and the business community, including many from Indonesia. Apart from the traditional political and economic updates, both of which are published in this issue of BIES, six broad topics were covered: employment, migration and microenterprises; education and health; health care for the poor; trends in poverty and social protection; government interventions; and the politics of poverty.     

Urban development patterns in Indonesia

The author examines recent urban development in Indonesia. "Analysis of urban developments in Indonesia has been hampered in the past by weak data. Recently, the National Urban Development Strategy (NUDS) project has generated a set of improved data. This paper aims at elaborating and supplementing the NUDS study. After a discussion of definitional problems, an analysis is carried out of urban growth rates at the provincial level. Private investment is shown to be a principal determinant of urban growth rates. Other significant determinants are rural immigration and the present level of urbanisation. Private investment is shown to be strongly biased towards provinces with large urban areas. In addition, polarisation is studied at the level of individual cities. It is found that a period of rapidly increasing polarisation has come to an end during the last decade."