Impacts of the Indonesian Economic Crisis: Price Changes and the Poor

40 Pages Posted: 13 Sep 1999 Last revised: 13 Oct 2010

See all articles by James A. Levinsohn

James A. Levinsohn

University of Michigan; National Bureau of Economic Research (NBER)

Steven Berry

Yale University - Department of Economics; National Bureau of Economic Research (NBER); Yale University - Cowles Foundation

Jed Friedman

affiliation not provided to SSRN

Date Written: June 1999

Abstract

The recent financial crisis in Indonesia has resulted in dramatic price increases. Using very recent data, we investigate whether these price increases have impacted the cost-of-living of poor households in a disproportionately harsh way. We find that the poor have indeed been hit hardest. Just how hard the poor have been hit, though, depends crucially on where the household lives, whether the household is in a rural or urban area, and just how the cost-of-living index is computed. What is clear is that the notion that the very poor are so poor as to be insulated from international shocks is simply wrong. Rather, in the Indonesian case, the very poor appear the most vulnerable.

Suggested Citation

Levinsohn, James A. and Berry, Steven T. and Friedman, Jed, Impacts of the Indonesian Economic Crisis: Price Changes and the Poor (June 1999). NBER Working Paper No. w7194, Available at SSRN: https://ssrn.com/abstract=171592

James A. Levinsohn (Contact Author)

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Steven T. Berry

Yale University - Department of Economics ( email )

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Yale University - Cowles Foundation

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Jed Friedman

affiliation not provided to SSRN

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