Increase household consumption

Oct 13, 2025 by wbrum.org 32 views

The Effect of Household Consumption, Unemployment, and Regional APBD Expenditures on Economic Growth in Urban Areas in North Sumatra Province

Regional economic growth is a crucial aspect of a region's development, and it is essential to understand the factors that contribute to it. In this study, we aim to determine the effect of household consumption, unemployment, and regional APBD expenditures on economic growth in urban areas in North Sumatra Province. Our research focuses on the 2010-2019 period, using a quantitative approach with time series and cross-section data.

Understanding Regional Economic Growth

Regional economic growth is an increase in community income that occurs in a region. The target of economic growth is certainly different in each region, as the economic potential in each region is unique. This is why government policies to regulate economic growth are tailored to the potential of each region. Regional economic growth is a process of local government and community in managing existing resources to create new jobs and stimulate economic growth.

Methodology

This study uses a quantitative approach, employing time series and cross-section data. The cross-section data included eight cities in North Sumatra Province, while the time series data were obtained from 2010 to 2019. Secondary data in the form of panel data were obtained from the Central Statistics Agency. The method used is the Least Square panel with a fixed effect model.

Results

The results of our study showed that household consumption variables have a significant effect on regional economic growth. This finding is logical, as an increase in household consumption in urban areas in North Sumatra can encourage economic growth. The increase in public consumption will increase demand for various goods and services, thereby spurring economic activity in various sectors.

The Impact of Unemployment on Economic Growth

Unemployment variables have a negative influence on economic growth. That is, the high unemployment rate can inhibit the rate of economic growth. This is because the high unemployment indicates the low purchasing power of the community, which in turn can reduce demand for goods and services.

The Role of Regional APBD Expenditures

The results of our study showed a positive and significant effect of regional APBD expenditures on economic growth. This means that the increase in APBD expenditure that is right on target and effective can be a driving force for economic growth in urban areas in North Sumatra.

Implications for Policy

Our research has some important implications for government policies in encouraging economic growth in urban areas in North Sumatra.

Increasing Community Purchasing Power

The government needs to focus on policies that can increase people's purchasing power, such as social assistance programs, job training programs, and new employment creation programs.

Increasing the Efficiency of APBD Expenditure

Local governments need to increase the efficiency and effectiveness of APBD spending, by prioritizing programs that have a direct impact on improving the economy and welfare of the community.

Unemployment Control Strategy

The government needs to implement effective unemployment control strategies, such as job training programs, labor-intensive programs, and entrepreneurship programs.

Conclusion

Household consumption, unemployment, and regional APBD spending have a significant role in economic growth in urban areas in North Sumatra. Local governments need to pay attention to these three factors in formulating policies that can encourage sustainable and inclusive economic growth.

Recommendations

Based on our findings, we recommend that local governments in North Sumatra Province focus on the following:

Increase household consumption: Implement policies that can increase household consumption, such as social assistance programs and job training programs.
Reduce unemployment: Implement effective unemployment control strategies, such as job training programs, labor-intensive programs, and entrepreneurship programs.
Increase the efficiency of APBD expenditure: Prioritize programs that have a direct impact on improving the economy and welfare of the community.

Limitations

Our study has some limitations. Firstly, our data only covers the 2010-2019 period, which may not be representative of the current economic situation. Secondly, our study only focuses on household consumption, unemployment, and regional APBD expenditures, which may not be the only factors that contribute to economic growth.

Future Research Directions

Future research should focus on the following:

Long-term data analysis: Analyze data from a longer period to understand the trends and patterns of economic growth in North Sumatra Province.
Other factors that contribute to economic growth: Investigate other factors that contribute to economic growth, such as investment, trade, and innovation.
Case studies: Conduct case studies of successful economic growth in other regions to identify best practices that can be applied in North Sumatra Province.

Resource

Central Statistics Agency (BPS) - Regional Statistics Data
Ministry of Home Affairs - Regional APBD Expenditure Data

By understanding the factors that contribute to economic growth in urban areas in North Sumatra Province, local governments can formulate policies that can encourage sustainable and inclusive economic growth. Our study provides valuable insights into the role of household consumption, unemployment, and regional APBD expenditures in economic growth, and we hope that our findings will contribute to the development of effective policies in North Sumatra Province.
Frequently Asked Questions (FAQs) about the Effect of Household Consumption, Unemployment, and Regional APBD Expenditures on Economic Growth in Urban Areas in North Sumatra Province

Q: What is the main objective of this study?

A: The main objective of this study is to determine the effect of household consumption, unemployment, and regional APBD expenditures on economic growth in urban areas in North Sumatra Province.

Q: What is the methodology used in this study?

A: This study uses a quantitative approach, employing time series and cross-section data. The cross-section data included eight cities in North Sumatra Province, while the time series data were obtained from 2010 to 2019. Secondary data in the form of panel data were obtained from the Central Statistics Agency. The method used is the Least Square panel with a fixed effect model.

Q: What are the findings of this study?

A: The findings of this study show that household consumption variables have a significant effect on regional economic growth. Unemployment variables have a negative influence on economic growth. The results of the study also showed a positive and significant effect of regional APBD expenditures on economic growth.

Q: What are the implications of this study for policy?

A: This study has some important implications for government policies in encouraging economic growth in urban areas in North Sumatra. The government needs to focus on policies that can increase people's purchasing power, such as social assistance programs, job training programs, and new employment creation programs. Local governments need to increase the efficiency and effectiveness of APBD spending, by prioritizing programs that have a direct impact on improving the economy and welfare of the community.

Q: What are the limitations of this study?

A: This study has some limitations. Firstly, our data only covers the 2010-2019 period, which may not be representative of the current economic situation. Secondly, our study only focuses on household consumption, unemployment, and regional APBD expenditures, which may not be the only factors that contribute to economic growth.

Q: What are the recommendations of this study?

A: Based on our findings, we recommend that local governments in North Sumatra Province focus on the following:

Increase household consumption: Implement policies that can increase household consumption, such as social assistance programs and job training programs.
Reduce unemployment: Implement effective unemployment control strategies, such as job training programs, labor-intensive programs, and entrepreneurship programs.
Increase the efficiency of APBD expenditure: Prioritize programs that have a direct impact on improving the economy and welfare of the community.

Q: What are the future research directions of this study?

A: Future research should focus on the following:

Long-term data analysis: Analyze data from a longer period to understand the trends and patterns of economic growth in North Sumatra Province.
Other factors that contribute to economic growth: Investigate other factors that contribute to economic growth, such as investment, trade, and innovation.
Case studies: Conduct case studies of successful economic growth in other regions to identify best practices that can be applied in North Sumatra Province.

Q: What are the resources used in this study?

A: The resources used in this study include:

Central Statistics Agency (BPS) - Regional Statistics Data
Ministry of Home Affairs - Regional APBD Expenditure Data

Q: What are the conclusions of this study?

A: Household consumption, unemployment, and regional APBD spending have a significant role in economic growth in urban areas in North Sumatra. Local governments need to pay attention to these three factors in formulating policies that can encourage sustainable and inclusive economic growth.