Published date: May 30 2024

Journal Title: KnE Social Sciences

Issue title: The 6th International Conference on Social Sciences and Humanities (ICOSSH VI)

Pages: 20–41

DOI: 10.18502/kss.v9i18.16326

Harrey Hadiharreyh1965@gmail.comPublic Administration Program, Faculty of Social Science and Political Science, Sriwijaya University, Jalan Padang Selasa 524, Palembang 30139, South Sumatra

Evi YulianaDevelopment Planning and Research Agency of Palembang City, Jalan Merdeka No. 74, South Sumatra

Agus FaturohimDevelopment Planning and Research Agency of Palembang City, Jalan Merdeka No. 74, South Sumatra

Meri AriyantiniDevelopment Planning and Research Agency of Palembang City, Jalan Merdeka No. 74, South Sumatra

The province of South Sumatra is widely known as one of the most prosperous regions in Indonesia. In fiscal year 2022, the region’s gross domestic product (GDRP) was Rp 591.603,48 billion, with a per capita income of Rp 68,31 billion. Additionally, this economy grew by 5,23%, exceeding the national average, and contributed Rp 9,98 trillion in actual revenue for the government. Nevertheless, the level of poverty remains significant, at 11.9%. Numerous scholarly studies have been conducted over the past few decades to investigate the interconnections between economic growth, income disparity, and poverty alleviation. The prevailing findings of these studies have consistently demonstrated that there is a positive correlation between economic growth and poverty alleviation. However, the relationship between economic growth and income inequality remains uncertain. This study aims to investigate the interrelationships between economic growth, inequality, and poverty reduction in the province of South Sumatra. The methodologies employed encompass descriptive analysis and panel data analysis. The analysis utilises Gross Domestic Regional Product (GDRP) statistics at the regency level, as well as data from the National Socio-economic Survey and local government budgets spanning the period from 2015 to 2022. The findings indicate that economic growth has turned out to be the result of increasing poverty and income inequality all at once. Growth in the mining and agricultural sectors tends to increase poverty because it is capital-intensive and does not appear to absorb labour from people experiencing poverty. Additionally, increases in income inequality are positively correlated with increases in poverty.

Keywords: economic growth, poverty alleviation, head count index, inequality, panel data analysis

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