The Impact of Conditional Cash Transfers on Low-Income Individuals in Indonesia

Agus Heruanto Hadna; Media Wahyudi Askar

doi:10.14764/10.ASEAS-0067

Authors

Agus Heruanto Hadna Universitas Gadjah Mada https://orcid.org/0000-0002-8716-1901
Media Wahyudi Askar Universitas Gadjah Mada https://orcid.org/0000-0003-3635-0961

DOI:

https://doi.org/10.14764/10.ASEAS-0067

Keywords:

Conditional Cash Transfer, Indonesia, Inequality, Lowest Wealth Quantile, Program Keluarga Harapan

Abstract

Most governments claim that Conditional Cash Transfer (CCT) programs benefit poor people. This study aims to analyze the impact of conditional cash transfers on low-income individuals in Indonesia. This study used consumption expenditures as a poverty measure and found that the Program Keluarga Harapan (PKH) has significant impact on an individual's consumption. However, households in the lowest wealth quantile were found to not take advantage of those benefits due to the current CCT design. Moreover, the heterogeneity of the CCT can generate substantial inequality, as household incomes in the lowest quantile fall. Therefore, governments should be more generous to households in the lowest wealth quantile, and carefully manage the program based on the needs of CCT beneficiaries.

Author Biographies

Agus Heruanto Hadna, Universitas Gadjah Mada

Agus Heruanto Hadna is an Associate Professor at Universitas Gadjah Mada. Currently, he serves as the Head of the Doctoral Program of Leadership and Policy Innovation, Universitas Gadjah Mada--Indonesia. Hadna is also a lecturer at the Department of Management and Public Policy, Faculty of Social and Political Sciences, and a senior researcher at the Center for Population and Policy Studies at the same university. He received his PhD in Public Administration from the University of Duisburg-Essen, Germany, in 2007. His study and research interests are poverty, policy innovation, leadership, and public service.

Media Wahyudi Askar, Universitas Gadjah Mada

Media Wahyudi Askar is a lecturer at Universitas Gadjah Mada. He completed his undergraduate degree at Universitas Gadjah Mada, Indonesia and holds a master’s and a doctoral degree from the University of Manchester, United Kingdom. His professional expertise varies in financial development, poverty, digital economy, small medium enterprises and economic inequality. Most of his research sees fiscal justice as key to the fight against extreme economic inequality.

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