<![CDATA[This study aims to analyze policies for empowering Micro, Small, and Medium Enterprises (MSMEs) in Cirebon City from the perspective of the welfare state ideology, utilizing a Systematic Literature Review (SLR). The study is motivated by the strategic role MSMEs play in strengthening the local economy, creating jobs, reducing inequality, and enhancing public welfare. However, pressures from the free market and digital transformation, alongside limited access to finance, low managerial capacity, and a digital literacy gap, pose challenges to realizing inclusive and sustainable empowerment policies. In this context, the state faces a dilemma between acting as a facilitator of market mechanisms and serving as a protector of the people's economic interests. The research employs an SLR methodology, identifying, selecting, evaluating, and synthesizing literature obtained from Google Scholar, DOAJ, and official local government portals covering the 2015–2025 period. Inclusion criteria encompass publications addressing public policy, MSME empowerment, political economy, governance, social protection, and policy implementation in Cirebon City or West Java. The findings indicate, first, a paradigm shift in policy from a bureaucratic-driven approach toward collaborative governance, although aspects of protection, asset strengthening, and access to economic resources for MSME actors remain limited. Second, the implementation of welfare state principles in Cirebon City tends to reflect "residual welfare"—where state intervention is primarily triggered by crises or economic vulnerability—rather than "institutional welfare," which guarantees continuous protection. Third, disparities in access and digital literacy threaten to widen the gap among MSME actors. The study recommends a policy reorientation grounded in distributive justice, socio-economic protection, digital inclusion, business capacity building, and multi-stakeholder collaboration in drafting local regulations, ensuring that MSME empowerment serves as an instrument for both economic development and the enhancement of public welfare.]]>
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