SMERU Publication

Working Paper
Topic: Poverty Analysis, Social Protection

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Destined for Destitution: Intergenerational Poverty Persistence in Indonesia

Yus Medina Pakpahan, Daniel Suryadarma, Asep Suryahadi

Editor:
Zahra Matthews

ABSTRACT

We estimate intergenerational poverty persistence in Indonesia using a panel dataset. To the best of our knowledge, this is the first such study looking at the issue in the Indonesian context. Different from the majority of studies on this issue, we include controls for several household and individual characteristics, including for living arrangements. Moreover, to circumvent data issues that plague earnings data in developing countries, we use chronic poverty status as a long-term parental welfare measure. We find there is a substantial intergenerational mobility away from poverty among children from poor households. However, the risk of continuing to live in poverty as adults is 35 percentage points higher for children from chronically poor households than for children from households which are not chronically poor.

Keywords: chronic poverty, intergenerational mobility, children, welfare, Indonesia
JEL Classifications: I32, J62

TABLE OF CONTENTS

ABSTRACT
TABLE OF CONTENTS
I. INTRODUCTION
II. ESTIMATION STRATEGY
III. DATA
IV. ESTIMATION RESULTS
V. CONCLUSION
LIST OF REFERENCES
APPENDIX