Driving Factors of Regional Human Development Index (HDI) in Tomini Bay

Abstract

Human Development Index (HDI) is one of the current measurements in identifying social welfare of a region. Tomini Bay is located in the world’s heart coral triangle and due to its tourism potential, provinces in the surrounding of Tomini Bay is estimated to experience increasing social welfare, especially the HDI level. This study further aims to estimate the driving factors of human development index (HDI) of provinces located in the surrounding of Tomini Bay, which includes North Sulawesi, Central Sulawesi, and Gorontalo. This study uses regional level data of North Sulawesi, Central Sulawesi, and Gorontalo within the year of 2010-2020 sourced from Statistics Indonesia. Furthermore, this study develops life expectancy rate, mean years of schooling, average years of schooling, expenditure per capita, unemployment rate, and poverty rate as the independent variables. This study employs fixed effect model (FEM) panel data regression, specifically the Generalized Least Square (GLS) method. GLS estimates show that life expectancy rate, mean years of schooling, expenditure per capita, and poverty rate significantly increases HDI, while unemployment rate significantly decrease HDI of North Sulawesi, Central Sulawesi, and Gorontalo. Implications of the study recommends regional government to formulate policies which encourages the increase of economic growth, income level, and accessibility on education and health sectors to further increase regional HDI.

Keywords: HDI, mean years of schooling, expenditure per capita, unemployment rate, and poverty rate.

DOI: 10.7176/JESD/13-14-02

Publication date:July 31^st 2022