The disparity on per capita income is evident between Java and outside Java in Indonesia. This paper confirms this evidence using σ-convergence statistic. Furthermore, this paper identify the determinant of per capita income by adopting the Solow growth model and β-convergence model. The result emphasize confirms the availability of basic infrastructure including electricity, road and sea transport are a necessary condition to gain high and sustainable growth. In addition, the result shows the existence of β-convergence, which represents the pace of regions with lower per capita income catching up other regions with higher per capita income, in Indonesia with 1,75% speed of convergence; or equivalent with half-life of 41.14 years. Furthermore, the openness will increase the region’s productivity due to higher technology spillover.
Maryaningsih, Novi; Hermansyah, Oki; and Savitri, Myrnawati
"PENGARUH INFRASTRUKTUR TERHADAP PERTUMBUHAN EKONOMI INDONESIA,"
Bulletin of Monetary Economics and Banking: Vol. 17:
1, Article 3.
Available at: https://bulletin.bmeb-bi.org/bmeb/vol17/iss1/3