The Impact of Socioeconomic, Government Expenditure and Transportation Infrastructures on Economics Development: The Case of West Timor, Indonesia

Abstract

Socioeconomic, government expenditures, and transportation infrastructures, such as roads and ports, play a critical role in the economic development of poor and deprived regions. These factors are as catalysts for increasing economic output and enhancing people’s living standards in these regions. This study of West Timor, Indonesia, aimed to examine the impact of Socioeconomic, government expenditure, road, and port infrastructure on economic growth. This study analyzed panel data from a cross-section of six regencies/municipality in the West Timor region from 2002 to 2020. The analytical method used in this research is the fixed effect model (FEM) and the random effect model (REM). We found that human development, government expenditure on personnel and capital expenditure, urbanization, and district roads positively impacted economic growth, while expenditure on goods and services has a negative impact on economic growth. In contrast to district roads, national roads adversely impact economic growth due to triggering backwash and leakage of the regional economy. Therefore, human development, government expenditure, and infrastructure development to encourage the local economy of underdeveloped areas in the country’s border areas must consider the needs of local communities in increasing their productivity.