UNDERSTANDING POVERTY IN THE DEVELOPMENT CONTEXT AND POVERTY REDUCTION POLICY USING SYSTEM DYNAMICS APPROACH

• Main Author: Ahmad NIM: 24015017, Fauzan
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/27225
• Institution: Institut Teknologi Bandung

Poverty is one of the development issues that is considered by various stakeholders and undesired phenomenon in development. poverty itself can be seen from various perspectives, both from ability to fulfil the basic needs financially and the impact felt for the poor themselves. In Indonesia, since 2000 (post-1998 crisis), poverty number has tended to show a decrease in behaviour, although there had been an increase in the number of poor people in several periods. This behaviour not only related to poverty reduction policies. This research was conducted with system dynamics approach aimed to understanding how poverty is formed and related with the socio-economic context and how the role of poverty alleviation policies in reducing poverty itself at the national level. The perspective of poverty used in this research based on Badan Pusat Statistik (BPS) poverty calculation (absolute poverty). The model simulation results show some related conclusions, namely (a) Based on the analysis with the system dynamics approach, poverty is simply formed based on the interaction of expenditure, distribution of expenditure and the poverty line itself, where in broad view related to dynamics of economic production, wage, price/inflation, labour, and population; (b) The role of the poverty alleviation budget represented by the poverty budget is significant enough to affect the poverty rate, where the national poverty rate can increase by approximately 2% -4% without a poverty reduction budget; and (c) for the long term, macro-poverty reduction policies can be directed through several mechanisms, (1) price-control, (2) improvement in income distribution, and (3) wage adjustment, especially for low-income labour. <br /> <br /> <br /> Keyword: poverty, poverty line, expenditure distribution, system dynamics <br />