Impact Evaluation of Decentralization in Indonesia through Natural Experiment

Research Project

Project/Area Number	25871152
Research Category	Grant-in-Aid for Young Scientists (B)
Allocation Type	Multi-year Fund
Research Field	Public finance/Public economy Economic policy
Research Institution	Institute of Developing Economies, Japan External Trade Organization
Principal Investigator	Higashikata Takayuki 独立行政法人日本貿易振興機構アジア経済研究所, 地域研究センター東南アジアI研究グループ, 研究員 (70450533)
Project Period (FY)	2013-04-01 – 2018-03-31
Project Status	Completed (Fiscal Year 2017)
Budget Amount *help	¥4,420,000 (Direct Cost: ¥3,400,000、Indirect Cost: ¥1,020,000) Fiscal Year 2016: ¥910,000 (Direct Cost: ¥700,000、Indirect Cost: ¥210,000) Fiscal Year 2015: ¥1,040,000 (Direct Cost: ¥800,000、Indirect Cost: ¥240,000) Fiscal Year 2014: ¥1,040,000 (Direct Cost: ¥800,000、Indirect Cost: ¥240,000) Fiscal Year 2013: ¥1,430,000 (Direct Cost: ¥1,100,000、Indirect Cost: ¥330,000)
Keywords	地方分権 / インドネシア / 影響評価 / 自然実験 / 公共財 / 都市化 / 地方分立 / 投票行動
Outline of Final Research Achievements	Indonesia implemented a radical decentralization during its rapid democratization after the Asian Financial Crisis. I made an analysis of an impact evaluation of the decentralization on the welfare of residents and showed that ethnically diverse jurisdictions experienced relatively poor level of infrastructure development and slow growth of the urban population rates after the introduction of the decentralization. Then, I utilized administrative village/town level panel data, which I prepared for the above analysis, to construct an original urban area dataset and identified positive causal effects of the population growth of urban areas on the per capita expenditure of rural villagers around those areas, especially that of the poor households during the period of 2000 to 2010, by exploiting earthquakes in Java island as quasi-experimental events.