Government and the Economy in Indonesia in the Nineteenth and Twentieth Centuries
What have been the main engines of growth in Indonesia since the early nineteenth century, and what has determined the distributional outcomes of that growth? These are complex questions which do not admit of any simple answer. Many students of Indonesian economic development both in colonial times and more recently have emphasised the crucial importance of external factors in determining the performance of the domestic economy. Certainly, the whole issue of the vulnerability of primary-exporting countries to fluctuations in their terms of trade, and the consequences of this vulnerability for their longer-term growth has generated an enormous international literature, which we will be looking at in more detail in the Indonesian context in the next chapter. But, for a deeper understanding of Indonesian economic performance since the early nineteenth century, we must also develop a better understanding of the domestic factors promoting, and inhibiting, economic growth. In this chapter, it is argued that the actions of successive governments, in both the colonial and post-colonial periods, are crucial to such an understanding.
KeywordsGovernment Expenditure Money Supply Budget Deficit Government Revenue Export Earning
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