Governance and Poverty Reduction: Evidence from Newly Decentralized Indonesia.

43 Pages Posted: 29 Nov 2005

See all articles by Sudarno Sumarto

Sudarno Sumarto

SMERU Research Institute

Asep Suryahadi

SMERU Research Institute

Alexander R. Arifianto

Kroc Institute for International Peace Studies - University of Notre Dame

Date Written: March 2004

Abstract

This study is the first attempt to systematically examine the impact of bad governance practices in Indonesia on poverty reduction. Indonesia is a country that has endured bad governance for a long period, but has also sustained significant poverty reduction. Prior to the onset of the economic crisis in mid 1997, the problem of bad governance in Indonesia was apparent but mostly ignored because it was compensated for by high economic growth. The advent of the economic crisis, however, has highlighted the seriousness of the problem. This study focuses on the impact of bad governance on the poor, the people who are most vulnerable to the impact of bad governance. By assembling scattered anecdotal evidence on how past and current practices of bad governance in Indonesia have hurt the poor, this study shows that the adverse impact of bad governance on the poor is real, systematically affects many people, and undermines the efforts to reduce poverty in the country. More systematic evidence on how bad governance affects poverty reduction indicates that regions that practice better governance indeed experience faster poverty reduction and vice versa.

Keywords: poverty reduction, governance, Indonesia, bad governance

JEL Classification: I31, I38, P46

Suggested Citation

Sumarto, Sudarno and Suryahadi, Asep and Arifianto, Alexander R., Governance and Poverty Reduction: Evidence from Newly Decentralized Indonesia. (March 2004). Available at SSRN: https://ssrn.com/abstract=858484 or http://dx.doi.org/10.2139/ssrn.858484

Sudarno Sumarto (Contact Author)

SMERU Research Institute ( email )

Jl. Tulung Agung No. 46
Jakarta, 10310
Indonesia

Asep Suryahadi

SMERU Research Institute ( email )

Jl. Cikini Raya No. 10A
Jakarta, 10330
Indonesia

HOME PAGE: http://www.smeru.or.id

Alexander R. Arifianto

Kroc Institute for International Peace Studies - University of Notre Dame ( email )

100 Hesburgh Center for International Studies
Notre Dame, IN 46556-5677
United States

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