Open Access Article

Title: Moderation of village funds and mediation of agricultural sector growth on poverty in rural areas

Authors: Abd. Rahman Razak; Adji Achmad Rinaldo Fernandes; Nur Imam Saifullah

Addresses: Faculty of Economics and Business, Hasanuddin University, Indonesia ' Faculty of Mathematics and Natural Sciences, Brawijaya University, Indonesia ' Faculty of Economics and Business, Hasanuddin University, Indonesia

Abstract: This study aims to analyse the Village Fund variable in moderating the influence of agricultural sector growth, population migration, and land use change variables on poverty in rural Indonesia. The method was multigroup SEM analysis with WarpPLS. The sample of this research is 33 provinces in Indonesia using secondary data from Central Bureau of Statistics. Based on the results of the study, it is concluded that the Village Fund can moderate strengthen or weaken the influence between variables. This means that an increase in the amount of Village Fund can strengthen the relationship between these variables. The novelty in this study is the Village Fund as a moderating variable. Previous studies only measured the effect of Village Funds on poverty by positioning Village Funds as an independent variable, not as a moderating variable. Moderation is categorised into high category Village Funds and low category Village Funds.

Keywords: poverty; Village Fund; population migration; land use change; agricultural sector growth; structural equation modelling; SEM; multigroup.

DOI: 10.1504/IJEBR.2023.134882

International Journal of Economics and Business Research, 2023 Vol.26 No.4, pp.463 - 483

Received: 12 Jun 2023
Accepted: 31 Jul 2023

Published online: 15 Nov 2023 *