PENGARUH INVESTASI FISIK DAN INVESTASI PEMBANGUNAN MANUSIA TERHADAP PERTUMBUHAN EKONOMI JAWA TIMUR 1990-2004

Abstract

The  roles  of  physical  investment  and  government  expenditure  on  economicdevelopment has been acknowledged in any various research. However, the study inthe role of human capital investment on development economic just  three decadeslater has been held. Human capital investment could be in the form of governmentexpenditure, mainly  to  increase  the  quality  of  human  resources.  It  consist  ofexpenditure  for  the  health  and  education.  It  is  an  importance  factor  to  increasehuman development  quality  and  enhance economic  growth. The  purposes of  thisresearch are to determine the influences of [1] private investment; [2] labor forcegrowth;  [3]  government  expenditure  of  East  Java  Province  for  human  capitalinvestment; [4] government expenditure of East Java Province  for routine/annualexpenditure; and [5] external condition on economic growth of East Java Province.The research applies panel data analysis, and it combines the cross section data in37 regency/municipality and time series data for periods 1990-2004. The researchapplies the verification process that is the Hausman test. The verification test foundthat the suitable model is fixed effect (FE) model. It is found in this research that allthe  independent variables except “external  condition†variable have statisticallypositive and significant influence on the economic growth in East Java Province.

Keywords: economic growth, physical investment and human capital investment.