Twenty Years of Expenditure Inequality in Indonesia, 1993-2013

In this article, we consider the recent increase in inequality in Indonesia. We make new, consistent estimates of expenditure inequality for 1993-2013, using several measures that draw on household expenditure data from the National Socioeconomic Survey (Susenas) for 1993-2013. In doing so, we note...

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Bibliographic Details
Published in:Bulletin of Indonesian economic studies 2014-05, Vol.50 (2), p.243-254
Main Authors: Yusuf, Arief Anshory, Sumner, Andy, Rum, Irlan Adiyatma
Format: Article
Language:English
Subjects:
Consumer spending
Data analysis
Distribution
Districts
Economic inequality
Empirical research
Estimating techniques
Expenditures
Gini
Historical analysis
Household expenditure
Indonesia
Inequality
Provinces
Studies
Theil
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Summary:In this article, we consider the recent increase in inequality in Indonesia. We make new, consistent estimates of expenditure inequality for 1993-2013, using several measures that draw on household expenditure data from the National Socioeconomic Survey (Susenas) for 1993-2013. In doing so, we note that the central statistics agency, Badan Pusat Statistik (BPS), used grouped data for its estimates of inequality until 2009 and that this underestimated inequality up to then. Thus the rise in inequality reported since 2009 actually has a longer history. We argue that Indonesia experienced divergence and convergence at the same time: the magnitude of the rise in inequality was significant (divergence), but the rise was greatest in provinces or districts with low initial levels of inequality (convergence). We consider the literature on drivers of changes in inequality and identify a set of hypotheses, with an empirical basis, which we introduce as potential Indonesian-specific drivers of rising inequality for future exploration.
ISSN:0007-4918
1472-7234
DOI:10.1080/00074918.2014.939937