An Empirical Analysis of Labour,Education and Health Related Policies inIndonesia

Abstract

The thesis investigates the impact of the Indonesian Government’s policies related to labour, education and health. The thesis consists of three empirical analyses: first, an examination of the impact of a household conditional cash transfer programme on female labour participation; secondly, an investigation of the effects of the nine-year compulsory schooling law enactment on educational and work outcomes; and finally an examination of the impact of the national programme of community empowerment on community participation and health facilities utilisation and health outcomes. The research employs econometric methods including difference-in-differences, instrumental variable and regression discontinuity design: it uses data from two large-scale randomised controlled trials (RCT), data from the household cash transfer programme and community empowerment programme and Indonesia Family Life Survey Data (IFLS). The thesis reveals that the household conditional cash transfer programme does not have an impact on female labour participation. The CCT programme did not motivate the women to work, and two years after its implementation it had not discouraged working in the short run. Six years after its implementation there was a significant reduction in female labour participation using IV estimation. The effects of nine-year compulsory schooling law were investigated by employing a regression discontinuity design. The results show that the compulsory schooling law has an impact on educational attainment in the fraction of people completing at least nine years of schooling. In terms of work outcomes, the policy has a significant effect on the likelihood of working in the formal sectors, but no effect on monthly wages. Lastly, this thesis evaluates the effects of the Generasi, a national programme of community empowerment, on community participation and health outcomes. The results from Generasi community empowerment programme suggest that the programme does not have an impact on the village decision-making process for community self-help activities. The programme does not have an impact on the quality of health facilities as measured by the availability of health personnel in a village. The programme suggests a marginally significant positive effect on mothers’ health knowledge. Despite the effect on mothers’ health knowledge, the programme does not have an impact on health facilities use for mothers. The empirical results for children suggest that the programme had significant positive effects on child visits to the Posyandu, the monthly health clinic, and whether nutritious meals were served during Posyandu sessions. However, the programme does not suggest any effect on children health outcomes.