Implication of Mining Investment improvement as Effect of Increasing Government Expenditure in Development of Mineral Industry in Indonesia (2009-2016)

Abstract

Increasing mining investment as an effect of government spending in the development of the mineral industry in Indonesia, aims to obtain mineral value added in the long run according to Law No. 4 of 2009 concerning Mineral and Coal Mining, can be realized with mineral industry clusters in a mining business area (WUP). The method used is Simultaneous Equation Model (SEM). The increase in mining investment has a significant effect on increasing mineral value added, which has positive implications for people's welfare which is manifested in the form of increasing contribution to the mining and quarrying business sector of the Regency GRDP, increasing employment opportunities and industrial CSR towards local communities. The increase in mineral reserves that have a significant effect on increasing mineral value added as an effect of government spending and mining investment has positive implications for the longer duration of mineral production and industrial activities in a mining business area (WUP), so that economic and social transformation can be realized well.