The Impact of Tariff Reduction on Poverty in Indonesia: Regional Level Analysis

The study examines the effect of trade liberalization on poverty reduction across districts in Indonesia during period from 2000 to 2016 using fixed approach. Tariff exposure is used measure liberalization, which computed at district level by combining information sector composition economy each and tariff lines sectors. This also distinguishes between for output products intermediate inputs. produces a indicating how changes reductions outputs inputs vary region over period. Due available multi-district 17-year dataset, includes set effects: district-fixed effects time-fixed effects, controls aggregate time trend. results indicate that impact input regional headcount index (P0) different. Output has negative correlation with poverty, while positive poverty. suggests sectors could reduce Indonesia. It found GRDP per capita, literacy rates, road length are negatively associated Also, reducing tariffs will be larger if have higher capita rates.