Spatial Linkage between Natural Disaster and Poverty on the Archipelago Country: Study Cases Indonesia

Document Type : Research Paper

Authors

1 Department of Economics, Faculty of Economics and Business, Universitas Airlangga, Surabaya, Indonesia

2 Research Institute of Socio Economics Development, Surabaya, Indonesia

3 Green Living Support, Surabaya, Indonesia

10.22059/ier.2024.352776.1007601

Abstract

This study employs spatial econometric modeling to investigate the relationship between natural disasters and poverty in Indonesia. Panel data spanning 2011 to 2019 are sourced from reputable authorities, including the Central Bureau of Statistics and the Natural Disaster Management Agency of the Republic of Indonesia. Empirical findings confirm the presence of spatial autocorrelation in provincial-level poverty in Indonesia, indicating interdependence among neighboring regions in terms of poverty dynamics. This study deviates from existing literature by revealing a surprising result: natural disasters are statistically associated with reduced provincial-level poverty. This counterintuitive outcome underscores the importance of governmental policies, programs, and external financial aid in mitigating the impact of natural disasters. Financial assistance and empowerment initiatives from third-party entities, such as NGOs, religious organizations, and youth groups, play a crucial role in helping disaster-affected communities. These findings offer valuable insights for policymakers. They can use this research to inform disaster response strategies and develop targeted poverty reduction programs at both inter-provincial and inter-regional levels. Ultimately, this study contributes to the understanding of the complex relationship between natural disasters and poverty in Indonesia, with implications for policy formulation and disaster resilience efforts.

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Iranian Economic Review

Articles in Press, Accepted Manuscript
Available Online from 12 February 2024

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