Universitas Gadjah Mada
Faculty of Economics and Business

The Special Region of Yogyakarta (DIY) is grappling with a pressing issue-it remains the region with the highest income inequality in Indonesia. This stark disparity is measured through the Gini ratio released by the Central Bureau of Statistics (BPS) in 2023, which recorded the urban and rural Gini Index in DIY at 0.439.

Meanwhile, Yogyakarta City is the area in DIY with the most significant inequality, with a Gini Index of 0.519 in 2022 and 0.454 in 2023. These values fall into the medium to high inequality category, relating to the income distribution among residents in Yogyakarta City. This high inequality has long-term negative impacts on the social and economic development of the community. Such conditions can affect growth rates, poverty levels, and the quality of life of the people.

Observing this condition, a group of students from the Faculty of Economics and Business, Gadjah Mada University (FEB UGM), in collaboration with students from the Faculty of Social and Political Sciences UGM (FISIPOL UGM), researched the application of the people's economics concept as an effort to improve economic equity in Yogyakarta City. They are Muhammad Nur Maulana (Accounting 2022), Muammar Ilham Hanafi Tarwaca (Accounting 2022), Aushaaf Rafif Keane Pribadi (Economics 2022), Ilham Prasetiyo (Social Development and Welfare 2022), and Laksita Balinda Anabela Darayanti (Economics 2022). The research was conducted under the supervision of Dr. Hempri Suyatna.

The head of the research team, Muhammad Nur Maulana, stated that inequality is one of the development focuses in line with the Sustainable Development Goals (SDGs), specifically point 10, which is to reduce inequality. The people's economics is one of the ideological concepts that focus on reducing inequality. Furthermore, the people's economics is Indonesia's' national economic system that supports the people's economics. The existence of this system can produce a community that is more resilient to economic disturbances through a joint networking system that is sustainably supported.

Several existing studies on the people's economics, Maulana continued, have focused on how the people's economics concept is formed (conceptual) and its implementation in several sectors. However, no research has yet discussed the resilience of the people's economics concept in society as a basis for improving the quality of life through reducing inequality.

Therefore, this research delves deeper into the existence of the people's economics concept correlated with inequality and analyzes the mindset that is the essence of the people's economics as a form of community understanding," he explained on Wednesday (July 10) at FEB UGM.

Through the research titled " Indonesian Economic Democracy Index: Reviewing the Existence of the Ekonomi Kerakyatan as an Effort to Improve Economic Equity in Yogyakarta City," they hoped that the value of the Indonesian Economic Democracy Index (IDEI) could be identified. In addition, this research aims to determine the relationship between the existence of the people's economics and economic equity in Yogyakarta City.

"Thus, it is hoped that strategies for strengthening the people's economics can be formulated to improve economic equity in Yogyakarta City. Of course, economic development strategies that align with Pancasila and are aimed at the welfare of the people," he concluded.

Reportage: Kurnia Ekaptiningrum 

Sustainable Development Goals