Exploring Socioeconomic Factors That Influence Economic Growth, Poverty and Saving Ability in Indonesia

Abstract

This study aims to determine and assess the effects of government and private foreign debt, education, credit, and inflation on economic growth, poverty, and saving ability, using panel data from 34 provinces in Indonesia during 2017-2023. The results, using a path analysis model, indicate that an increase in private foreign debt (PFD) leads to increased economic growth; in other words, a higher PFD leads to higher economic growth. Meanwhile, for government foreign debt (GFD), the opposite occurs; in other words, a higher GFD leads to higher economic growth. Furthermore, education leads to a decrease in poverty but has a positive impact on saving ability. Furthermore, credit has no effect on economic growth or poverty but has a significant positive impact on saving ability inflation has no effect on either poverty or savings.