Haruna Moshood (not verified)
May 05, 2023
The question of whether Indonesia has experienced stagnation or impressive poverty reduction depends on how one defines and measures poverty. One key issue in poverty measurement is the choice of the poverty line, which determines who is considered poor and who is not.
Relative poverty lines are based on a certain percentage of the median income or consumption level in a given society. For example, if the poverty line is set at 50% of the median income, then individuals or households whose income or consumption is below that threshold are considered poor. The advantage of relative poverty lines is that they capture changes in income inequality and living standards in a society. However, they do not necessarily reflect changes in absolute levels of well-being, and may not be comparable across different countries or time periods.
Absolute poverty lines, on the other hand, are based on a fixed threshold of income or consumption that is deemed necessary to meet basic needs, such as food, shelter, and clothing. These thresholds are usually adjusted for inflation and differences in the cost of living across regions. The advantage of absolute poverty lines is that they provide a more universal and comparable measure of poverty, and can capture changes in living standards over time. However, they may not reflect changes in income distribution or inequality within a society.
In Indonesia, the poverty line is based on a combination of both absolute and relative measures. The national poverty line is set at a minimum expenditure necessary to meet basic food and non-food needs, which is adjusted for inflation and regional price differences. Additionally, there are also poverty lines based on relative measures, such as the 40th and 30th percentile of expenditure distribution in urban and rural areas, respectively.
According to official statistics, Indonesia has made impressive progress in reducing poverty over the past two decades. The national poverty rate declined from 24.2% in 1999 to 9.78% in March 2020, based on the absolute poverty line. This reduction has been attributed to a combination of factors, including sustained economic growth, social assistance programs, and improvements in access to education and health services.
However, there are also concerns about the quality and accuracy of poverty data, as well as the persistence of poverty and inequality in certain regions and population groups. Some experts argue that the official poverty line may be too low to capture the full extent of poverty and deprivation in Indonesia, especially in areas with high living costs or vulnerable populations. Others point to the need for more comprehensive and nuanced measures of poverty and well-being that take into account factors such as gender, ethnicity, and social exclusion.
In conclusion, the question of whether Indonesia has experienced stagnation or impressive poverty reduction depends on how one defines and measures poverty. While official statistics suggest significant progress in reducing poverty based on the absolute poverty line, there are also concerns about the accuracy and relevance of this measure. A more comprehensive and nuanced approach to poverty measurement is needed to fully capture the complex and dynamic nature of poverty in Indonesia.