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Citation Information

Type Working Paper - Center for Economics and Development Studies Universitas Padjadjaran
Title Living beyond $2 a day: How Indonesia has progressed
Author(s)
Publication (Day/Month/Year) 2013
URL http://lp3e.fe.unpad.ac.id/wopeds/201313.pdf
Abstract
Using a long series of household level survey data and more information on regional variation in the poor's living cost and inflation, we estimated the proportion of people living below 2005 PPP $2 a day. We found that for the period of 1990 to 2012, the $2 poverty
incidence has been declining at an average rate of 2.2% per year leaving only 36.5% in 2012.
The rate of the decline in the last ten years (or reformasiera, 2002-2012) has been faster
(2.9% a year) than during the pre-reformasi era or the period of 1990-1996 (1.4% a year).
This is in contrast to a rather slow rate of the decline in the poverty incidence with national poverty line during the reformasi era which was only 0.65% a year. We also found that the $2 poverty has been more concentrated among informal labor and agricultural workers. The difference between $2 poverty incidence in formal a nd informal labor was larger during the reformasi era, a sign that the informal labor has been rather left behind. During the reformasiera, the economic growth was a lot more income-inequalizing and a lot less pro-poor relative to growth during the period before the reformasi era. This applies to both the poor defined asthose living below national poverty line or those living below $2 a day.

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