The distribution of the benefits from social services in Indonesia, 1978-87

Abstract

Indonesia has made great progress in the past fifteen years in giving the poor more access to privately provided goods such as food, clothing, and housing. The author analyzes how much progress has been made in improving their access to two publicly provided social services, education and health care. She finds that given existing patterns of use, education spending is more efficient at directly reaching the poor than is health spending. In the education sector, subsidies to primary education are most likely to reach poorer households and raise their living standards. In the late 1980s, enrollments remained higher for urban than for rural areas, for male than for female children, and for the Outer Islands than for Java. But rates of improvement in enrollments during the last decade have been higher for rural, female, and poorer children than for the urban, male, and richer counterparts. The results indicate that rising living standards played a part in raising enrollment. But other factors were substantially more important - public policy aimed at increasing the number of primary schools and teachers and at lowering the costs of attending school. In the health sector, subsidies to basic primary health care provide the best avenue for reaching the poor, but they are far from ideal as an instrument for doing so.

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