Paper ID: 13
Structural Transformation and Poverty Reduction: Case Study in West Kalimantan Province
Faculty of Agriculture, University of Panca Bhakti, Indonesia
This study aimed to analyze the structural transformation in West Kalimantan and to test its impacts on poverty reduction. At the regional level, West Kalimantan is a province with the second highest gross regional domestic product (GRDP) after East Kalimantan, and it has a good Gini ratio. Meanwhile, West Kalimantan has the most significant number of poor people of all other provinces in Kalimantan. That is the problem that needs solutions. Time series data over 11 years (2010 – 2020) were used in this study. The structural transformation was analyzed with Esteban-Marquillas’ (E-M) Shift-Share approach. The transformation impacts on poverty reduction were analyzed with the multiple linear regression method. The study’s results revealed that the structural transformation had not been done. In addition to the service sector, the agricultural sector plays a significant role in poverty reduction. Nevertheless, the development of the industrial sector has not contributed to the reduction due to the few local manpower involved. The industrial sector is expected to be the potential to reduce poverty and enhance economic growth by developing industries that are closely related to both the agricultural and service sectors.