On 16 August 2018, ementerian Perencanaan Pembangunan Nasional/Badan Perencanaan Pembangunan Nasional (BAPPENAS) hosted the FKP Seminar in Jakarta on the topic of poverty and welfare dynamics. Faizal Rahmanto Moeis (Faculty of Economics and Business, Universitas Indonesia) presented his study on the role of land and labor mobility on poverty and welfare dynamics.

Between 2000-2014, the number of agriculture households in Indonesia has decreased, along with  farmland ownership. The study used the Indonesia Family Life Survey (IFLS) data to measure measured the poverty incidence and welfare dynamics in two separate models and three different time frames: 2000-2007,2007-2014, and 2000-2014. Besides observing the household labor status (agriculture or non-agriculture) and the land ownership, the study also considers demographic aspects, infrastructure aspects, and other variables.

Poverty Dynamics in Agriculture Household and Farmland Ownership, 2000-2014 (Source: Moeis, 2018)

The study found that between 2000-2007, households that moved out from agriculture sector became better off. However, the same condition was not observed for the time period  2007-2014. Further, the shift in labor from agricultural to non-agricultural sectors proved to be more effective in reducing poverty in non-Java region compared to Java. In terms of farmland ownership, the study found that the ownership of farmland by agricultural households is important; households that loss their ownership of farmland proved to be more prone to poverty. In addition, households with higher education attainment and higher agriculture business were unlikely to fall into poverty.

This study indicated that households that move out of agriculture does not always become better off. Keeping land ownership is more significant in improving the livelihood of agricultural households. Furthermore, improving productivity through human capital and physical capital is also important for the agricultural households.

For the complete presentation and Q&A session, please refer to the videos and materials provided.