Developing countries have experienced rapid urbanization, though its causal effect on the welfare of rural households is still not clear. In this study, we utilize a severe earthquake in 2006, which hit one of the largest urban areas in Jawa Island of Indonesia, as a natural experimental event in order to identify the causal relation between urbanization and rural poverty reduction. Referring to the definition of the OECD (2012), we construct an original Indonesian urban area data set from population census data of 2000 and 2010. Then, we merge the data set with household panel data, as well as with village/town level census data. Our estimation results using the instrumental variable approach show that 1) effective market size growth as an index of population urbanization leads to an increase in per capita expenditure of households in rural villages, and especially those of the poorer villagers, and that 2) this increase in the welfare of the poor households seems to be brought about mainly by the increase in income from non-farm business.
権利
Copyrights 日本貿易振興機構（ジェトロ）アジア経済研究所 / Institute of Developing Economies, Japan External Trade Organization (IDE-JETRO) http://www.ide.go.jp
雑誌名
IDE Discussion Paper
雑誌名(英)
IDE Discussion Paper
巻
673
発行年
2017-07
出版者
Institute of Developing Economies (IDE-JETRO)
著者版フラグ
author
地域/国名
インドネシア
キーワード(LSH)
Indonesia
Urbanization
Poverty
Income
Household
Earthquake
Natural Experiment
Expenditure
Non-farm business
The causal effect of urbanization on rural poverty reduction: quasi-experimental evidence using Indonesian urban area data
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