Citation:

Shanti Marzalina, Haryadi, Candra Mustika, Syamsurijal Tan, Zainul Bahri, Etik Umiyati. "Determinants of Income Inequality in Indonesia (Comparative Study of Sumatera and Java Island)" International Research Journal of Economics and Management Studies, Vol. 4, No. 6, pp. 19-28, 2025.

Abstract:

This study aims to analyze the influence of Infrastructure, Government Expenditure, Investment, and Poverty levels (a Comparative Study of the Sumatra and Java Islands). The data used is panel data (time series and cross section) from 2019 to 2023, consisting of each province in Sumatra and Java Islands. Data sourced from the Central Statistics Agency (BPS). The data was analyzed using the Difference Test (Independent Sample t-test) and panel data. The results of the analysis show that partially on Sumatra Island, of the 5 independent variables, namely Infrastructure, Government Expenditure, Government Policy, Investment, and Poverty Level. There are 2 variables found not to affect the dependent variable, namely Infrastructure and Government Expenditure, and 3 variables that do, namely Government Policy, Investment, and Poverty Level, in contrast to Java Island, of the 4 independent variables, namely Infrastructure, Government Expenditure, Investment, and Poverty Level. There are 4 variables found to affect the dependent variable, and only 1 variable does not affect it, namely Poverty Level. However, simultaneously, all of these independent variables have a significant influence on Income Inequality in Sumatra and Java. With the t-test (Independent Sample T-test), the difference in Income Inequality between Sumatra and Java was obtained.

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Keywords:

Infrastructure, Government Expenditure, Government Policy, Investment, Poverty Rate, Income Inequality.