EAS Publisher | Do Education and Health Sectors Matter for Poverty Reduction?

Do Education and Health Sectors Matter for Poverty Reduction?

DOI : https://doi.org/10.36349/easmb.2020.v03i01.003

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This research aims at measuring and analyzing the effects of spending on education and health sectors on poverty reduction both in short- and long-term perspectives for the case of Aceh province, Indonesia. This study contributes toward the achievement of the Sustainable Development Goals (SDGs) as it has been a focal point targeted by the government in the country. The Autoregressive Distributed Lag (ARDL) panel model is used to analyze the issue by using the annual secondary data over the 2008-2017 period, covering 23 districts/cities in the province of Aceh, Indonesia. The study found that spending on education and health sectors has an insignificant effect in the short-term on poverty reduction. In the long-term, however, spending on education and health sectors showed a positive effect on poverty reduction. These findings implied that to further reduce the poverty rate, the long-term focus should be given on enhancing the education and health sectors by providing excellent facilities, teaching, and medical staff, and supported by sufficient operational budgets for schools and medical centers.

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