Poverty and Its Problems in the Province of West Sumatra

Abstract

Poverty is a problem that is difficult for many countries to overcome, so the United Nations (UN) created an SDGS agenda whose main goal is to end all forms of poverty in this world by 2030. To overcome this poverty, many countries are trying to see what factors cause poverty to occur. This research tries to look at the causes of poverty in terms of education, Human Development Index, Unemployment, Income Inequality, and Labor Force Participation Rate in Districts/Cities of West Sumatra Province from 2011-2019. The research analysis technique uses panel data regression with cross sections of 19 districts and cities and the 2011-2019 time series. Estimation of the relationship using the panel model regression method is the Common Effect Model, Fixed Effect Model and Random Effect Model. Selection of the best model is done by Chow tetst and Hausman tests is the Random Effect Model. Based on the research results, it was found that education and the Human Development Index can significantly reduce poverty and unemployment, and income inequality can significantly increase poverty, as well as the Labor Force Participation Rate. The results of this study provide recommendations to local governments to provide access to higher education and better health for the whole community as well as provide employment and reduce income inequality that occurs.