S. Pramana, Y. Yuniarti, Dede Yoga Paramartha, Satria Bagus Panuntun
All countries affected by the COVID-19 pandemic have established several policies to control the spread of the disease. The government of Indonesia has enforced a work-from-home policy and large-scale social restrictions in most regions that result in the changes in community mobility in various categories of places. This study aims to (1) investigate the impact of large-scale restrictions on provincial-level mobility in Indonesia, (2) categorize provinces based on mobility patterns, and (3) investigate regional socio-economic characteristics that may lead to different mobility patterns. This study utilized Provincial-level Google Mobility Index, Flight data scraped from daily web, and regional characteristics (e.g., poverty rate, percentages of informal workers). A Dynamic Time Warping method was employed to investigate the clusters of mobility. The study shows an intense trade-off of mobility pattern between residential areas and public areas. In general, during the first 2.5 months of the pandemic, people had reduced their activities in public areas and preferred to stay at home. Meanwhile, provinces have different mobility patterns from each other during the period of the large-scale restrictions. The differences in mobility are mainly led by the percentage of formal workers in each region.
{"title":"Mobility Pattern Changes in Indonesia in Response to COVID-19","authors":"S. Pramana, Y. Yuniarti, Dede Yoga Paramartha, Satria Bagus Panuntun","doi":"10.47291/efi.v67i1.924","DOIUrl":"https://doi.org/10.47291/efi.v67i1.924","url":null,"abstract":"All countries affected by the COVID-19 pandemic have established several policies to control the spread of the disease. The government of Indonesia has enforced a work-from-home policy and large-scale social restrictions in most regions that result in the changes in community mobility in various categories of places. This study aims to (1) investigate the impact of large-scale restrictions on provincial-level mobility in Indonesia, (2) categorize provinces based on mobility patterns, and (3) investigate regional socio-economic characteristics that may lead to different mobility patterns. This study utilized Provincial-level Google Mobility Index, Flight data scraped from daily web, and regional characteristics (e.g., poverty rate, percentages of informal workers). A Dynamic Time Warping method was employed to investigate the clusters of mobility. The study shows an intense trade-off of mobility pattern between residential areas and public areas. In general, during the first 2.5 months of the pandemic, people had reduced their activities in public areas and preferred to stay at home. Meanwhile, provinces have different mobility patterns from each other during the period of the large-scale restrictions. The differences in mobility are mainly led by the percentage of formal workers in each region.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"67 1","pages":"75"},"PeriodicalIF":0.0,"publicationDate":"2021-04-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45709565","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Poor nutritional status, especially during childhood, has a negative impact on one’s early life as well as throughout their life. One of the factors that influences the improvement of children’s nutritional status is the bargaining power of the mother. Previous studies have limitations in that they often use cross-sectional data and indirect approaches to measuring bargaining power. This study aims to measure the impact of maternal bargaining power on children’s nutritional status in Indonesia. The unit of analysis is children aged 7–19 years (IFLS5) who still have and live with their parents (IFLS4). Using the OLS estimation method, the results show that maternal bargaining power significantly and positively influences the nutritional status of children (HA z-score).
{"title":"The Impact of Mother’s Bargaining Power on the Nutritional Status of Children in Indonesia","authors":"Ahmad Yeyen Fidyani, I. D. H. Wisana","doi":"10.47291/efi.v67i1.797","DOIUrl":"https://doi.org/10.47291/efi.v67i1.797","url":null,"abstract":"Poor nutritional status, especially during childhood, has a negative impact on one’s early life as well as throughout their life. One of the factors that influences the improvement of children’s nutritional status is the bargaining power of the mother. Previous studies have limitations in that they often use cross-sectional data and indirect approaches to measuring bargaining power. This study aims to measure the impact of maternal bargaining power on children’s nutritional status in Indonesia. The unit of analysis is children aged 7–19 years (IFLS5) who still have and live with their parents (IFLS4). Using the OLS estimation method, the results show that maternal bargaining power significantly and positively influences the nutritional status of children (HA z-score).","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"67 1","pages":"115"},"PeriodicalIF":0.0,"publicationDate":"2021-04-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42808170","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Vincent Gunawan, V. Dewi, Triyana Iskandarsyah, Irsanti Hasyim
This paper presents an empirical study on women’s financial literacy in a developing country, Indonesia. Financial literacy in developing countries, especially for women, needs to be improved. Traditionally, women have an important role in managing family finances. Their ability to conduct good financial management can help their family’s financial stability and improve its welfare. If women do not have adequate capacity to manage the family’s finances, the family’s economic health can be at risk. Having financial literacy is important as it provides financial resilience at times of uncertainty. This explanatory research uses a sample comprising 100 women living in the city of Bandung, Indonesia, who are in the Baby Boomer generation as well as in Generations X, Y, and Z. The data were collected through an online questionnaire and analyzed using partial least squares structural equation modeling (PLS-SEM). The results provide evidence that perceived financial knowledge has a significant effect on financial management behavior in the dimensions of savings behavior, shopping behavior, long-term planning, and short-term planning. Moreover, the study results show that the respondents have a moderate level of financial literacy and financial management behavior.
{"title":"Women’s Financial Literacy: Perceived Financial Knowledge and Its Impact on Money Management","authors":"Vincent Gunawan, V. Dewi, Triyana Iskandarsyah, Irsanti Hasyim","doi":"10.47291/efi.v67i1.720","DOIUrl":"https://doi.org/10.47291/efi.v67i1.720","url":null,"abstract":"This paper presents an empirical study on women’s financial literacy in a developing country, Indonesia. Financial literacy in developing countries, especially for women, needs to be improved. Traditionally, women have an important role in managing family finances. Their ability to conduct good financial management can help their family’s financial stability and improve its welfare. If women do not have adequate capacity to manage the family’s finances, the family’s economic health can be at risk. Having financial literacy is important as it provides financial resilience at times of uncertainty. This explanatory research uses a sample comprising 100 women living in the city of Bandung, Indonesia, who are in the Baby Boomer generation as well as in Generations X, Y, and Z. The data were collected through an online questionnaire and analyzed using partial least squares structural equation modeling (PLS-SEM). The results provide evidence that perceived financial knowledge has a significant effect on financial management behavior in the dimensions of savings behavior, shopping behavior, long-term planning, and short-term planning. Moreover, the study results show that the respondents have a moderate level of financial literacy and financial management behavior.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-04-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46635711","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This research aims to measure the level of Islamic financial literacy among students by reviewing 2 dimensions, 8 variables, and 33 indicators obtained from literature studies and experts. This study applied mix method to qualitative and quantitative data with a total sample of 273 respondents. The data were obtained from interview and online FGD and then processed by word similarity analysis as well as validity and reliability tests, the results of which are used as reference and conclusion. The analysis shows that the level of understanding of financial literacy among students remains significantly low, proven by the value of the interpretation of respondents reaching below 40% despite valid and reliable variables and indicators. Meanwhile, the analysis of the relationship between each variable that consists of supporting indicators shows that each variable affects one another. This study generates a financial literacy index serving as a measuring tool in bridging the SDGs of Islamic Finance. It implies the necessity of increasing the understanding of Islamic finance with the concept of literacy for students as an agenda to achieve a demographic bonus.
{"title":"Islamic Financial Literacy Index of Students: Bridging SDGs of Islamic Finance","authors":"Arief Dwi Saputra, Alfina Rahmatia","doi":"10.47291/efi.v67i1.730","DOIUrl":"https://doi.org/10.47291/efi.v67i1.730","url":null,"abstract":"This research aims to measure the level of Islamic financial literacy among students by reviewing 2 dimensions, 8 variables, and 33 indicators obtained from literature studies and experts. This study applied mix method to qualitative and quantitative data with a total sample of 273 respondents. The data were obtained from interview and online FGD and then processed by word similarity analysis as well as validity and reliability tests, the results of which are used as reference and conclusion. The analysis shows that the level of understanding of financial literacy among students remains significantly low, proven by the value of the interpretation of respondents reaching below 40% despite valid and reliable variables and indicators. Meanwhile, the analysis of the relationship between each variable that consists of supporting indicators shows that each variable affects one another. This study generates a financial literacy index serving as a measuring tool in bridging the SDGs of Islamic Finance. It implies the necessity of increasing the understanding of Islamic finance with the concept of literacy for students as an agenda to achieve a demographic bonus.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"67 1","pages":"34"},"PeriodicalIF":0.0,"publicationDate":"2021-04-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44873181","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Publications of Sustainable Development Goals (SDGs) have mainly been conducted at a national level and separately for each goal. No prior research has been done on SDGs composite index at a provincial level in Indonesia. It is necessary to create a composite index that presents a single value at the provincial level to enable regional evaluation. The Indonesia Province SDGs composite index is developed from indicators based on Statistics Indonesia gathered from several publications. The data sources are the National Socio-Economic Survey (Susenas) and the Basic Health Research (Riskesdas) which were linked surveys held in 2018. Principal Component Analysis and Factor Analysis are used as the methods to select the indicators of the SDGs. Those selected indicators are then normalized using the min-max method and subsequently weighted using factor loading derived from the principal component analysis. Finally, the indicators are aggregated using an arithmetic mean to determine the composite index. The Indonesia Province SDGs composite index is an approach to measure achievement of SDGs agenda. In addition, each goal achievement is summarized as a goal index. The SDGs composite index for Lampung Province is 52.2%, meaning that Lampung Province is 52.2% of the way to fully achieving the SDGs, according to the measures used to calculate this index. The findings on goal index suggest that development is highly requested on public services such as housing and water supply.
{"title":"Indonesian Provinces SDGs Composite Index: Lampung Province Analysis","authors":"Reny Andriati, A. Yusuf","doi":"10.47291/EFI.V67I1.819","DOIUrl":"https://doi.org/10.47291/EFI.V67I1.819","url":null,"abstract":"Publications of Sustainable Development Goals (SDGs) have mainly been conducted at a national level and separately for each goal. No prior research has been done on SDGs composite index at a provincial level in Indonesia. It is necessary to create a composite index that presents a single value at the provincial level to enable regional evaluation. The Indonesia Province SDGs composite index is developed from indicators based on Statistics Indonesia gathered from several publications. The data sources are the National Socio-Economic Survey (Susenas) and the Basic Health Research (Riskesdas) which were linked surveys held in 2018. Principal Component Analysis and Factor Analysis are used as the methods to select the indicators of the SDGs. Those selected indicators are then normalized using the min-max method and subsequently weighted using factor loading derived from the principal component analysis. Finally, the indicators are aggregated using an arithmetic mean to determine the composite index. The Indonesia Province SDGs composite index is an approach to measure achievement of SDGs agenda. In addition, each goal achievement is summarized as a goal index. The SDGs composite index for Lampung Province is 52.2%, meaning that Lampung Province is 52.2% of the way to fully achieving the SDGs, according to the measures used to calculate this index. The findings on goal index suggest that development is highly requested on public services such as housing and water supply. ","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"1 1","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-04-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"42448584","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This paper aims to test the impact of uncertainty on the causal relationship among exports, imports, and economic growth in Indonesia. The relationship is constructed by examining the presence of FDI-adjusted exports and imports (trade) and the output link using conditional variances-covariances derived from the generalized autoregressive conditional heteroskedastic (GARCH) process in a vector error correction model (VEC-GARCH model). Using evidence in Indonesia, the model exposes the uni-directional nexus from trade performance to trade-adjusted output growth in the absence of uncertainty. The volatility effects are evident in the causal relationship between trade and output. The finding shows that the uncertainty effects hamper the trade-economic growth nexus. Incorporated with the long-run causality, trade still causes output even after containing the contributions of volatility. The significant role of imports highlights the higher demand for intermediate capital products and the inclusion of technology in strengthening economic growth.
{"title":"Does Uncertainty Matter for Trade - Economic Growth Nexus in Indonesia?","authors":"Panky Tri Febiyansah, B. D. Cahyono, R. Novandra","doi":"10.47291/efi.v67i1.933","DOIUrl":"https://doi.org/10.47291/efi.v67i1.933","url":null,"abstract":"This paper aims to test the impact of uncertainty on the causal relationship among exports, imports, and economic growth in Indonesia. The relationship is constructed by examining the presence of FDI-adjusted exports and imports (trade) and the output link using conditional variances-covariances derived from the generalized autoregressive conditional heteroskedastic (GARCH) process in a vector error correction model (VEC-GARCH model). Using evidence in Indonesia, the model exposes the uni-directional nexus from trade performance to trade-adjusted output growth in the absence of uncertainty. The volatility effects are evident in the causal relationship between trade and output. The finding shows that the uncertainty effects hamper the trade-economic growth nexus. Incorporated with the long-run causality, trade still causes output even after containing the contributions of volatility. The significant role of imports highlights the higher demand for intermediate capital products and the inclusion of technology in strengthening economic growth.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2021-04-29","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"43393308","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Hanif Putra Ardianto, I. Harymawan, Y. I. Paramitasari, M. Nasih
This study aims to analyze the impact of financial reporting quality on the investment efficiency of a company. The study uses 994 observations from companies listed on the Indonesia Stock Exchange (IDX) in three periods from 2013 to 2015. The findings suggest that higher financial reporting quality has a positive and significant relationship with investment efficiency. Furthermore, the tests were conducted on groups of companies experiencing underinvestment and overinvestment. It was found that higher financial reporting quality had a negative and significant relationship with companies experiencing overinvestment. The findings provide implications for investors in assessing investment management carried out by company.
{"title":"Financial Reporting Quality and Investment Efficiency: Evidence from Indonesian Stock Market","authors":"Hanif Putra Ardianto, I. Harymawan, Y. I. Paramitasari, M. Nasih","doi":"10.47291/EFI.V66I2.702","DOIUrl":"https://doi.org/10.47291/EFI.V66I2.702","url":null,"abstract":"This study aims to analyze the impact of financial reporting quality on the investment efficiency of a company. The study uses 994 observations from companies listed on the Indonesia Stock Exchange (IDX) in three periods from 2013 to 2015. The findings suggest that higher financial reporting quality has a positive and significant relationship with investment efficiency. Furthermore, the tests were conducted on groups of companies experiencing underinvestment and overinvestment. It was found that higher financial reporting quality had a negative and significant relationship with companies experiencing overinvestment. The findings provide implications for investors in assessing investment management carried out by company.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":"66 1","pages":"112-122"},"PeriodicalIF":0.0,"publicationDate":"2021-01-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47126036","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This study provides empirical findings on regional disparity in infrastructural facilities in 23 districts/municipalities of Aceh Province and the impact of the disparity on the economic performance of Aceh Province, specifically on those of economic growth, poverty, and unemployment. The unit of analysis is the district level and the Infrastructure Development Index (IDI) is used as the variable computed by using the multivariate method. Regional disparity is measured by the Coefficient of Variation and the impact of IDI on the province’s economy is analyzed using the econometric model. The analysis shows that infrastructure development disparity exists and that IDI generally affects the economic performance in Aceh Province. Specifically, the results reveal that electricity provision, the number of hotels, and the length of road positively correlate with economic performance. However, the number of Base Transceiver Stations, the number of markets, and the number of banks do not necessarily lead to higher economic performance. The policy implications of the findings are discussed.
{"title":"The Impact of Disparity in Infrastructure Development on Aceh’s Economic Performance: An Inter-Provincial Analysis","authors":"Mutiara Fahmi, S. Sahara, Yeti Lis Purnamadewi","doi":"10.47291/EFI.V66I2.674","DOIUrl":"https://doi.org/10.47291/EFI.V66I2.674","url":null,"abstract":"This study provides empirical findings on regional disparity in infrastructural facilities in 23 districts/municipalities of Aceh Province and the impact of the disparity on the economic performance of Aceh Province, specifically on those of economic growth, poverty, and unemployment. The unit of analysis is the district level and the Infrastructure Development Index (IDI) is used as the variable computed by using the multivariate method. Regional disparity is measured by the Coefficient of Variation and the impact of IDI on the province’s economy is analyzed using the econometric model. The analysis shows that infrastructure development disparity exists and that IDI generally affects the economic performance in Aceh Province. Specifically, the results reveal that electricity provision, the number of hotels, and the length of road positively correlate with economic performance. However, the number of Base Transceiver Stations, the number of markets, and the number of banks do not necessarily lead to higher economic performance. The policy implications of the findings are discussed.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"48795521","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
As one of the priority sectors in economic development of Indonesia, tourism is expected to be the main key in accelerating economic and social growth, hence reducing poverty. The tourism performance, especially international tourism market, is highly prone to intervention events that can reduce the number of inbound tourists and produce a negative impact on economic development of the destination country. Therefore, anticipating and mitigating various intervention events is necessary to maintain the performance of the tourism sector in Indonesia. This study investigates the magnitude and patterns of impact of several intervention events on the number of international visitor arrivals via the three main ports of entry of Indonesia, i.e. Soekarno-Hatta Airport, Ngurah Rai Airport, and Batam Port. The multi input intervention models were constructed by covering intervention events, i.e. terrorism, disease pandemic, global financial crisis, natural disaster, and government policy, occurring in a relatively long time span, more than two decades, from January 1999 to August 2020. The results show that an intervention event does not always have a significant impact on the number of international visitor arrivals at the three main ports of entry. Generally, all intervention events can lead to a decrease in the number of international visitor arrivals but with different magnitude and pattern, with the biggest and longest impact is caused by COVID-19 pandemic. The direct or non-delayed pattern of impact only appears for terrorism and natural disaster that affect the number of international visitor arrivals via Ngurah Rai Airport.
{"title":"The International Tourism Performance Amidst Several Intervention Events: More than 20 Years of Multi Input Intervention Analysis in Bali, Jakarta, and Kepulauan Riau Provinces","authors":"Taly Purwa, Eviyana Atmanegara","doi":"10.47291/EFI.V66I2.870","DOIUrl":"https://doi.org/10.47291/EFI.V66I2.870","url":null,"abstract":"As one of the priority sectors in economic development of Indonesia, tourism is expected to be the main key in accelerating economic and social growth, hence reducing poverty. The tourism performance, especially international tourism market, is highly prone to intervention events that can reduce the number of inbound tourists and produce a negative impact on economic development of the destination country. Therefore, anticipating and mitigating various intervention events is necessary to maintain the performance of the tourism sector in Indonesia. This study investigates the magnitude and patterns of impact of several intervention events on the number of international visitor arrivals via the three main ports of entry of Indonesia, i.e. Soekarno-Hatta Airport, Ngurah Rai Airport, and Batam Port. The multi input intervention models were constructed by covering intervention events, i.e. terrorism, disease pandemic, global financial crisis, natural disaster, and government policy, occurring in a relatively long time span, more than two decades, from January 1999 to August 2020. The results show that an intervention event does not always have a significant impact on the number of international visitor arrivals at the three main ports of entry. Generally, all intervention events can lead to a decrease in the number of international visitor arrivals but with different magnitude and pattern, with the biggest and longest impact is caused by COVID-19 pandemic. The direct or non-delayed pattern of impact only appears for terrorism and natural disaster that affect the number of international visitor arrivals via Ngurah Rai Airport.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"45892632","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Dewi Ratna Sjari Martokoesoemo, B. Sinaga, N. Kusnadi, Y. Syaukat
Micro and Small Industries (MSIs) constitute the largest share of Indonesia’s manufacturing sector and play an important role in providing employment opportunities and value-added creation. However, their business sustainability and scaling up are often hindered by various factors, one of which is access to credit. The subsidized loan scheme provided by the government, namely People’s Business Credit (KUR), appears to be insufficiently attractive to entrepreneurs, especially to Micro and Small Women Entrepreneurs (MSWEs). Employing a logit regression method and utilizing the BPS-Statistics Indonesia’s 2015 MSI survey data, this study aims to investigate factors affecting MSWEs’ decision to apply for bank loans and factors contributing to the approval of their credit applications by banks. The results show that MSWEs have low participation in credit borrowing, partially due to business vulnerability and self-rationing attitude, while credit application rejection is caused mainly by banks’ conservative approach to MSWEs. Practical implications of the findings are discussed.
{"title":"Business Vulnerability and Credit Access for Agriculture-Based Micro and Small Women Entrepreneurs","authors":"Dewi Ratna Sjari Martokoesoemo, B. Sinaga, N. Kusnadi, Y. Syaukat","doi":"10.47291/EFI.V66I2.666","DOIUrl":"https://doi.org/10.47291/EFI.V66I2.666","url":null,"abstract":"Micro and Small Industries (MSIs) constitute the largest share of Indonesia’s manufacturing sector and play an important role in providing employment opportunities and value-added creation. However, their business sustainability and scaling up are often hindered by various factors, one of which is access to credit. The subsidized loan scheme provided by the government, namely People’s Business Credit (KUR), appears to be insufficiently attractive to entrepreneurs, especially to Micro and Small Women Entrepreneurs (MSWEs). Employing a logit regression method and utilizing the BPS-Statistics Indonesia’s 2015 MSI survey data, this study aims to investigate factors affecting MSWEs’ decision to apply for bank loans and factors contributing to the approval of their credit applications by banks. The results show that MSWEs have low participation in credit borrowing, partially due to business vulnerability and self-rationing attitude, while credit application rejection is caused mainly by banks’ conservative approach to MSWEs. Practical implications of the findings are discussed.","PeriodicalId":31064,"journal":{"name":"Economics and Finance in Indonesia","volume":" ","pages":""},"PeriodicalIF":0.0,"publicationDate":"2020-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"44873154","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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