Migration of Agricultural Workers and Provincial Income Inequality: Analyses Using Indonesian Census Data

2016 Fiscal Year Final Research Report

• Project/Area Number: 26450327
• Research Category: Grant-in-Aid for Scientific Research (C)
• Allocation Type: Multi-year Fund
• Section: 一般
• Research Field: Agricultural science in rural society and development
• Research Institution: Kobe University
• Principal Investigator: Hondai Susumu 神戸大学, 国際協力研究科, 名誉教授 (70138569)
• Project Period (FY): 2014-04-01 – 2017-03-31
• Keywords: 所得格差 / 労働分配率 / 労働過剰 / ルイスの転換点 / 労働生産性の上昇 / 労働移動

Outline of Final Research Achievements

The main objective of our research is to find out why Indonesian income inequality has been still widening. To attain our objective, we analyzed firstly marginal productivity of agricultural laborers and found there was surplus labor of Lewis (1954) concept in the agricultural sector.
When there is surplus labor in an economy, the agricultural wage rate stays close to a subsistent level. As the result, the labor shares in both agricultural and non-agricultural sectors will decline as the average productivity of labor in both sectors increases. Then, these trends of labor share created a widening income inequality in Indonesia. The labor shares will move up only after Indonesian economy passes the turning point from the labor abundant to labor shortage economy. This change in labor share will improve Indonesian income equality substantially.

Free Research Field

開発政策