DYNAMIC ANALYSIS OF FACTORS INFLUENCING POVERTY LEVELS IN EASTERN INDONESIA: GENERALIZED METHOD OF MOMENTS (GMM) APPROACH

Poverty is one of the most talked about problems. Althoug-h the Eastern Region is rich in natural resources, it has remained trapped in the poorest category for many years. The failure of economic development is the main cause that must be overcome so that the negative impact of poverty can be minimized. This study examines the factors that affect the poverty rate in 12 provinces in the Eastern Region for the 2014-2023 period, using the Generalized Method of Moments (GMM) with the FD-GMM and SYS-GMM approaches. Of the five variables studied, three variables were proven to have a significant effect on the poverty rate, namely the lag of the poverty variable, the Human Development Index, and the Minimum Wage, while the other two variables such as the Labor Force Participation Rate and the number of identified population did not have an effect. These findings provide important insights for policymakers in designing more effective and targeted poverty alleviation strategies.