Title Page
ABSTRACT
Contents
1. INTRODUCTION 12
1.1. Background 12
1.2. Research Objectives 15
1.3. Statement of the Problem 16
1.4. Significance of the Study 18
1.5. Scope of the Study 19
1.6. Limitation of the Study 22
1.7. Organization of the Thesis 24
2. LITERATURE REVIEW 27
2.1. Poverty 27
2.1.1. The Concept of Poverty 27
2.1.2. Measures of Poverty 29
2.1.3. Policies Intervention in Poverty Alleviation 32
2.2. Fiscal Decentralization and Special Allocation Fund (DAK) 36
2.2.1. The Concept of Fiscal Decentralization in Indonesia 36
2.2.2. Policy Implications of the Special Allocation Fund (DAK) 40
2.3. The Role of Fiscal Decentralization and Special Allocation Funds (DAK) in Poverty Alleviation 44
2.4. Gap Analysis 51
3. RESEARCH METHODOLOGY 53
3.1. Research Framework 53
3.2. Data Collection 55
3.3. Data Processing 60
3.3.1. Spatial Analysis 60
3.3.2. Regression Analysis 65
4. DATA ANALYSIS AND INTERPRETATIONS 72
4.1. Spatial Analysis 72
4.1.1. Poverty Distribution Mapping 72
4.1.2. Global Moran's Index: Auto Correlation Analysis 73
4.1.3. Anselin Local Moran's Index: Cluster Analysis 74
4.1.4. Summary of Spatial Analysis 78
4.2. Regression Analysis 81
4.2.1. Multiple Regression Analysis (OLS Model) 81
4.2.2. Multiscale Geographically Weighted Regression (MGWR) 88
4.2.3. Summary of Regression Analysis 109
5. CONCLUSIONS 114
5.1. Summary and Conclusion 114
5.2. Policy Recommendations 116
5.3. Recommendations for Future Studies 118
BIBLIOGRAPHY 121
초록 128
Table 1. Poverty Line and Poverty Rate in Indonesia (2021-2022) 32
Table 2. The Distribution of Fiscal Decentralization in Local Budget in 2021 39
Table 3. List of DAK Distribution Sector in 2021 42
Table 4. Poverty Rate in Sumatra Region Provinces (2022) 49
Table 5. Total of DAK per Province in Indonesia (2021) 50
Table 6. Relative Change of Poverty Rate (2021-2022) in North Sumatra Province 56
Table 7. Dependent and Independent Variables 58
Table 8. Dataset for Regression Analysis 59
Table 9. Anselin Local Moran's I Report 75
Table 10. OLS Diagnostic Report 82
Table 11. Summary of OLS Result 83
Table 12. MGWR Diagnostic Report 89
Table 13. MGWR Summary Statistics for Coefficients Estimates 90
Table 14. MGWR Summary Local R-Squared 92
Table 15. Diagnostic Report Comparison between OLS and MGWR 109
Table 16. Comparison of Variable Significance between OLS and MGWR 111
Figure 1. The Location of North Sumatra Province in Indonesia 20
Figure 2. The Map of 33 municipals and Regencies in North Sumatra Province 21
Figure 3. The Average Local Government Budget Proportion in 2021 38
Figure 4. The Process of DAK Distribution in 2021 41
Figure 5. The Number of Poor People in Province in Indonesia (2022) 49
Figure 6. Research Framework Design 53
Figure 7. Spatial Analysis Design Steps 60
Figure 8. The Moran's Index Calculation 63
Figure 9. Anselin Local Moran's I Equation 64
Figure 10. Regression Analysis Steps 66
Figure 11. Geographycal Weighted Regression (GWR) Calculation Model 70
Figure 12. Poverty Distribution Map in North Sumatra (2020 - 2022) 72
Figure 13. Global Moran's Index Report 73
Figure 14. Anselin Local Moran's I Scatterplot Diagram 77
Figure 15. Anselin Local Moran's I Cluster Map 77
Figure 16. MGWR Result: DAK Health on Poverty Reduction 94
Figure 17. MGWR Result: DAK Education on Poverty Reduction 95
Figure 18. MGWR Result: DAK Infrastructure on Poverty Reduction 96
Figure 19. MGWR Result: DAK Agriculture on Poverty Reduction 97
Figure 20. MGWR Result: DAK Fisheries on Poverty Reduction 98
Figure 21. MGWR Result: DAK Tourism on Poverty Reduction 99
Figure 22. MGWR Result: DAK Small Medium Industry on Poverty Reduction 100
Figure 23. MGWR Result: DAK Environment on Poverty Reduction 101
Figure 24. MGWR Result: DAU on Poverty Reduction 102
Figure 25. MGWR Result: DBH on Poverty Reduction 103
Figure 26. MGWR Result: Village Fund on Poverty Reduction 104
Figure 27. MGWR Result: Population Density on Poverty Reduction 105
Figure 28. MGWR Result: Distance on Poverty Reduction 106
Figure 29. MGWR Result: Islands on Poverty Reduction 107
Figure 30. MGWR Result: GRDP on Poverty Reduction 108