EKONOMIS : Journal of Economics and Business
Vol 10, No 2 (2026): September

Determinants Analysis of Economic Growth in Papua Province, Indonesia

Dimas Bagus Wiranatakusuma (Master of Economics Study Program, Faculty of Economics and Business, Universitas Muhammadiyah Yogyakarta)
Lilies Setiartiti (Master of Economics Study Program, Faculty of Economics and Business, Universitas Muhammadiyah Yogyakarta)
Nana Dwi Ayuningsih (Bachelor of Economics Study Program, Faculty of Economics and Business, Universitas Muhammadiyah Yogyakarta)
Fawwaz Ardhan Kencana (Bachelor of Economics Study Program, Faculty of Economics and Business, Universitas Muhammadiyah Yogyakarta)



Article Info

Publish Date
09 Sep 2026

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.

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Journal Info

Abbrev

ojsekonomis

Publisher

Subject

Economics, Econometrics & Finance

Description

Ekonomis: Journal of Economics and Business diterbitkan oleh Lembaga Penelitian dan Pengabdian pada Masyarakat Universitas Batanghari Jambi, Jurnal ini mencakup bidang ilmu Ekonomi Manajemen, Ekonomi Pembangunan, Akuntansi dan Bisnis. Ekonomis: Journal of Economics and Business Jurnal ini ...