The Determinants and Consequences of the Placement of Government Programs in Indonesia

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Abstract
Most estimates of the consequences of public programs rely on the cross-sectional association between region-specific programs and program outcomes. Such estimates assume that the spatial distribution of programs is random. This article reports estimates of the effects of public programs on basic human capital indicators and the biases in conventional cross-sectional estimates of program effects due to non-random program placement. The estimates are obtained from pooled observations on human capital outcomes, socioeconomic variables, and program coverage at the kecamatan (subdistrict) level. The observations are based on successive sets of Indonesian cross-sectional household and administrative data during 1976–86. The determinants of the spatial allocation of programs in Indonesia in 1976–86 are also estimated.

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