Counting The Poor in Indonesia

Abstract

A confusing aspect of the now rather large literature on trends in poverty in Indonesia in the New Order period is that virtually every study has used a different poverty line concept; indeed, even the World Bank appears to have used different poverty lines in different published studies and unpublished reports Unlike the government of Malaysia, for example, the Indonesian government has not chosen to promulgate a poverty line in its official planning documents, and successive Five Year Development Plans have had very little to say about poverty trends. However, the Central Bureau of Statistics (BPS) has in recent years put forward its own poverty line concept which has been used to estimate numbers in poverty in urban and rural areas, and these estimates have been published for some years in the annual Indikator Kesejahteraan Rakyat [Welfare Indicators]. Although the BPS estimates are now widely quoted in Indonesia, they have not won universal acceptance, and other authors continue to use other poverty line concepts and thus derive different conclusions regarding the extent of poverty in Indonesia, the regional distribution of the poor and trends in poverty over time. One purpose of this paper is to review critically these different poverty concepts and to explain why they have produced different results. A second aim is to compare the Indonesian poverty line estimates with those from neighbouring ASEAN countries. Finally, some suggestions will be made on possible new initiatives in poverty research in Indonesia.