The Special Region of Yogyakarta (DIY) remains Indonesia’s highest income inequality area. This inequality is measured through the Gini ratio, as Statistics Indonesia (BPS) reported in 2023, which recorded a Gini Index for urban and rural areas in DIY at 0.439.
Meanwhile, Yogyakarta City has the highest inequality in DIY, with a Gini Index of 0.519 in 2022 and 0.454 in 2023. These values fall into the medium to high inequality category, relating to income distribution among the residents of Yogyakarta.
The high level of inequality has long-term negative impacts on the social and economic development of the community. This condition can affect growth rates, poverty levels, and the overall quality of life.
In response, students from the UGM Faculty of Economics and Business (FEB UGM) and Faculty of Social and Political Sciences (Fisipol UGM) collaborate to research the application of the people’s economy concept to improve economic equity in Yogyakarta.
The team consists of Muhammad Nur Maulana (Accounting 2022), Muammar Ilham Hanafi Tarwaca (Accounting 2022), Aushaaf Rafif Keane Pribadi (Economics 2022), Ilham Prasetiyo (Social Development and Welfare 2022), and Laksita Balinda Anabela Darayanti (Economics 2022).
The research was conducted under the guidance of Dr. Hempri Suyatna as part of the Student Creativity Program in Social Sciences and Humanities Research (PKM-RSH).
The research team leader, Muhammad Nur Maulana, stated that inequality is a development focus in line with the Sustainable Development Goals (SDGs), particularly point 10, which is to reduce inequality.
The people’s economy is one of the ideological concepts focused on reducing inequality.
Moreover, the people’s economy is Indonesia’s national economic system that supports the people’s economy. The existence of this system can create a society more resilient to economic disruptions through a shared networking system that is sustainably funded.
Maulana further explained that existing research on the people’s economy has focused on how the people’s concept of the people’s economy is formed (conceptual) and how it is implemented in various sectors.
However, no research discusses the resilience of people’s economic concept in society as a basis for improving the quality of life by reducing inequality.
“Therefore, this research delves deeper into the existence of the people’s economy concept about inequality and analyzes the mindset that underpins the people’s economy as a form of public understanding,” Maulana explained on Wednesday, Jul. 9, 2024, at FEB UGM.
The research titled “Indonesian Economic Democracy Index: An Examination of the Existence of the People’s Economy as an Effort to Improve Economic Equity in Yogyakarta City.”
They aim to determine the value of the Indonesian Economic Democracy Index (IDEI) and understand the existence of the people’s economy in Yogyakarta.
Additionally, the research seeks to understand the relationship between the existence of the people’s economy and economic equity in Yogyakarta.
“With this, it is hoped that strategies to strengthen the people’s economy can be formulated to improve economic equity in Yogyakarta and an economic development strategy that aligns with Pancasila and is aimed at the welfare of the community can be born,” he concluded.
Report: FEB UGM/Kurnia Ekaptiningrum
Post-editor: Lintang