DEVELOPMENT OF SEMIPARAMETRIC PATH ANALYSIS MODELING TRUNCATED SPLINE: DETERMINANTS OF INCREASED REGIONAL ECONOMIC GROWTH

This research aims to determine regional economic improvement to achieve a better Indonesian economy and accelerate the path to achieving a Golden Indonesia in 2045 so that it can be realized in a shorter time. This goal will be achieved with the help of statistical analysis methods, where the analysis used in this research is semiparametric truncated spline indirect effect and total effect analysis. The research becomes original in its approach with the utilization of this method and offers novel insights into the dynamics of regional economic development in Indonesia. These methods in this research serve as a tool for analyzing regional economic dynamics, identifying critical factors for improvement, informing policy decisions aimed at realizing Indonesia’s economic aspirations for the future, and providing more flexible results to achieve the research objectives. The study was carried out on data with regional expenditure variables as exogenous variables, labor absorption variables as mediating endogenous variables, and regional economic growth variables as pure endogenous variables. The data used in the research are data published by the National/Provincial Central Bureau of Statistics in the form of the Indonesian Statistics Book, BPS publications in the form of Provinces, Provincial Government Financial Statistics, Directorate General of Financial Balance, Sumreg Bappenas, as well as from Ministries, Institutions or Agencies that related to providing data relating to the variables of this research in 2020. The results of this research are that the relationship between regional expenditure variables and labor absorption variables has a significant effect on regional economic growth variables.