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All Journal EKONOMIS : Journal of Economics and Business
Fawwaz Ardhan Kencana
Bachelor of Economics Study Program, Faculty of Economics and Business, Universitas Muhammadiyah Yogyakarta
Economics, Econometrics & Finance

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Determinants Analysis of Economic Growth in Papua Province, Indonesia Dimas Bagus Wiranatakusuma; Lilies Setiartiti; Nana Dwi Ayuningsih; Fawwaz Ardhan Kencana
Ekonomis: Journal of Economics and Business Vol 10, No 2 (2026): September
Publisher : Universitas Batanghari Jambi

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.33087/ekonomis.v10i2.1796

Abstract

This study aims to analyse the effects of capital expenditure, investment, and labour on economic growth in Papua Province. A balanced panel of seven regencies (Mimika, Jayapura, Merauke, Nabire, Asmat, Paniai, and Keerom) covering the period 2011–2020 (N = 70) was employed. The Fixed Effect Model was selected based on the Chow and Hausman tests. The estimation results show that capital expenditure has a positive and significant effect on economic growth (β = 0.017254; p = 0.0001), labour also exerts a positive and significant influence (β = 97.56682; p = 0.0214), while investment is statistically insignificant (β = −0.020393; p = 0.5117). Jointly, the three variables significantly affect economic growth and explain 97.1% of the variation in GRDP at constant prices. The findings indicate that capital expenditure and labour absorption were the primary drivers of regency-level economic growth in Papua, whereas the benefits of investment remained largely confined to the extractive sector. Policy implications include improving capital budget realisation, directing investment toward sectors with stronger local linkages, and enhancing workforce quality.
Co-Authors Dimas Bagus Wiranatakusuma Lilies Setiartiti Nana Dwi Ayuningsih