UNDERSTANDING THE ROOTS OF INDONESIA’S REGIONAL DISPARITIES: TOWARDS BETTER GROWTH CENTER BASED DEVELOPMENT STRATEGIES

Abstraksi

Indonesian government has tried to reduce regional disparities since decades ago. However, the disparities persist even though some policies have been applied. The author argues that roots of disparities among regions in Indonesia must be well understood in order to find the most effective policies. It can explain why growth center related policies such as KAPET are still unable to provide a successful experience. First, this paper provides a synthesis of theories. It employs some models to explain how the archipelago spatial structure has been changed due to several factors including the European intervention, modernization, access to world market and power relation, that establish a stronger foundation for regional disparities that already occurs previously due to geographical factors, which continuous to the post-colonial period. Second, it also examines from Perroux’s growth poles theory to the later theoretical development of Boudeville, Friedman, Hirschman and Myrdal, etc and the role of city-size and rank-size and core-periphery model, to the recent theories including agglomeration economies concept. Third, by employing statistical analysis, this paper studies several types of current regional disparities in Indonesia based on different set of indicators, which can be classified into the economic concentration and welfare level indicators. Findings are presented on how regional disparities in Indonesia are influenced by some factors such as location, institution, internationalization/globalization, geographical condition, and power relation. It explains as well why some policies are not yet successful in reducing the disparities. Finally, recommendation is proposed on how growth center based development strategies to be prepared.