Citation:

Salaudin Al Ayubi, Zainuri Zainuri, Regina Niken Wilantari. "The Effect of the Crime Index on the Growth of Regency Investment in East Java with Consideration of Sustainable Effects" International Research Journal of Economics and Management Studies, Vol. 4, No. 12, pp. 157-162, 2025. Crossref. http://doi.org/10.56472/25835238/IRJEMS-V4I12P119

Abstract:

Investment plays a crucial role in promoting regional economic growth; however, its performance is strongly influenced by the quality of governance and security conditions. This study aims to examine the effect of bureaucratic effectiveness, proxied by the crime index, on investment growth across regencies/cities in East Java Province, considering the sustainable impact of investment from the previous period. This research employs a quantitative, panel-data approach using data from regencies/cities in East Java for the period 2015–2023. The analytical methods include panel data regression and a dynamic panel model using the Generalized Method of Moments (GMM) Arellano–Bond to capture lag effects and address potential dynamic bias. The empirical results indicate that the crime index has no statistically significant effect on investment growth, despite substantial regional variation in security conditions. In contrast, investment growth in the previous period has a positive and significant impact on current investment growth, indicating the presence of investment persistence. These findings suggest that regional investment dynamics in East Java are driven more by the sustainability of past investment performance and structural economic factors than by variations in crime levels alone. Policy implications underscore the importance of fostering a conducive, sustainable investment climate through improvements in infrastructure, regulatory certainty, and consistent regional policies.

References:

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Keywords:

Crime Index, The Growth of Regency/City Investment, Consideration of Sustainable Effects.