Aspiring Indonesia—Expanding the Middle Class
Indonesia has seen tremendous progress in poverty reduction over the past couple of decades and, as a result, has made a successful transition from low-income to middle-income country status. As millions have moved out of poverty and extreme povert...
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World Bank, Washington, DC
2020
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| Online Access: | http://documents.worldbank.org/curated/en/519991580138621024/Aspiring-Indonesia-Expanding-the-Middle-Class http://hdl.handle.net/10986/33237 |
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okr-10986-332372021-05-25T09:32:01Z Aspiring Indonesia—Expanding the Middle Class World Bank MIDDLE CLASS FEMALE LABOR FORCE PARTICIPATION TAX REVENUE SHARED PROSPERITY URBAN DEVELOPMENT ECONOMIC GROWTH SOCIAL PROTECTION ACCESS TO HEALTH SERVICES ACCESS TO BASIC SERVICES EDUCATION QUALITY SKILLS DEVELOPMENT ENTREPRENEURSHIP POVERTY LINE PUBLIC SERVICE DELIVERY JOB SKILLS NEW SOCIAL CONTRACT SOCIAL INSURANCE UNIVERSAL HEALTH COVERAGE Indonesia has seen tremendous progress in poverty reduction over the past couple of decades and, as a result, has made a successful transition from low-income to middle-income country status. As millions have moved out of poverty and extreme poverty, we have also witnessed the rise of Indonesia’s middle class, which now accounts for 20 percent of the total population, or 52 million Indonesians. This group important for Indonesia’s upward trajectory, but it still too small for the ambitions of Indonesia. Expanding the middle class will boost economic growth, strengthen an influential constituency for better governance, and widen and deepen the tax base. An expansion of the middle class, if accompanied by continued growth in the incomes of the poor and vulnerable, will also help to decrease inequality and prevent polarization of the country. One of the key development questions that Indonesia faces is how to expand the middle class. What will be required to bring the 115 million people who are no longer in poverty and vulnerability into the middle class? The future of Indonesia lies partly in the fate of this aspiring middle class, 45 percent of the population, so that they can both share in and help to drive the country’s growing prosperity. Government policy can play an instrumental role in expanding the middle class. This can be done by increasing the level and quality of education, and the skills of the population, and making sure there are well-paid jobs waiting for those in the aspiring middle class. It also means ensuring access to social protection to help lift these aspirers into the middle class and keep them there once they arrive, as well as improving the quality of the public services upon which they currently depend. Resolve to expand the middle class will place greater stress on government budgets. The government will need increasingly rely on the middle class, whose income taxes will finance much of the investment that a growing Indonesia will need. This will require a new social contract with the current – and future – middle class so that they will embrace the policies that both benefit themselves while also helping to expand their ranks, rather than closing off opportunities for others, and creating political polarization—as has occurred in some countries in the region in recent years. 2020-01-27T17:19:50Z 2020-01-27T17:19:50Z 2019-09 Report http://documents.worldbank.org/curated/en/519991580138621024/Aspiring-Indonesia-Expanding-the-Middle-Class http://hdl.handle.net/10986/33237 English CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Economic & Sector Work Economic & Sector Work :: Other Poverty Study East Asia and Pacific Indonesia |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
MIDDLE CLASS FEMALE LABOR FORCE PARTICIPATION TAX REVENUE SHARED PROSPERITY URBAN DEVELOPMENT ECONOMIC GROWTH SOCIAL PROTECTION ACCESS TO HEALTH SERVICES ACCESS TO BASIC SERVICES EDUCATION QUALITY SKILLS DEVELOPMENT ENTREPRENEURSHIP POVERTY LINE PUBLIC SERVICE DELIVERY JOB SKILLS NEW SOCIAL CONTRACT SOCIAL INSURANCE UNIVERSAL HEALTH COVERAGE |
| spellingShingle |
MIDDLE CLASS FEMALE LABOR FORCE PARTICIPATION TAX REVENUE SHARED PROSPERITY URBAN DEVELOPMENT ECONOMIC GROWTH SOCIAL PROTECTION ACCESS TO HEALTH SERVICES ACCESS TO BASIC SERVICES EDUCATION QUALITY SKILLS DEVELOPMENT ENTREPRENEURSHIP POVERTY LINE PUBLIC SERVICE DELIVERY JOB SKILLS NEW SOCIAL CONTRACT SOCIAL INSURANCE UNIVERSAL HEALTH COVERAGE World Bank Aspiring Indonesia—Expanding the Middle Class |
| geographic_facet |
East Asia and Pacific Indonesia |
| description |
Indonesia has seen tremendous progress
in poverty reduction over the past couple of decades and, as
a result, has made a successful transition from low-income
to middle-income country status. As millions have moved out
of poverty and extreme poverty, we have also witnessed the
rise of Indonesia’s middle class, which now accounts for 20
percent of the total population, or 52 million Indonesians.
This group important for Indonesia’s upward trajectory, but
it still too small for the ambitions of Indonesia. Expanding
the middle class will boost economic growth, strengthen an
influential constituency for better governance, and widen
and deepen the tax base. An expansion of the middle class,
if accompanied by continued growth in the incomes of the
poor and vulnerable, will also help to decrease inequality
and prevent polarization of the country. One of the key
development questions that Indonesia faces is how to expand
the middle class. What will be required to bring the 115
million people who are no longer in poverty and
vulnerability into the middle class? The future of Indonesia
lies partly in the fate of this aspiring middle class, 45
percent of the population, so that they can both share in
and help to drive the country’s growing prosperity.
Government policy can play an instrumental role in expanding
the middle class. This can be done by increasing the level
and quality of education, and the skills of the population,
and making sure there are well-paid jobs waiting for those
in the aspiring middle class. It also means ensuring access
to social protection to help lift these aspirers into the
middle class and keep them there once they arrive, as well
as improving the quality of the public services upon which
they currently depend. Resolve to expand the middle class
will place greater stress on government budgets. The
government will need increasingly rely on the middle class,
whose income taxes will finance much of the investment that
a growing Indonesia will need. This will require a new
social contract with the current – and future – middle class
so that they will embrace the policies that both benefit
themselves while also helping to expand their ranks, rather
than closing off opportunities for others, and creating
political polarization—as has occurred in some countries in
the region in recent years. |
| format |
Report |
| author |
World Bank |
| author_facet |
World Bank |
| author_sort |
World Bank |
| title |
Aspiring Indonesia—Expanding the Middle Class |
| title_short |
Aspiring Indonesia—Expanding the Middle Class |
| title_full |
Aspiring Indonesia—Expanding the Middle Class |
| title_fullStr |
Aspiring Indonesia—Expanding the Middle Class |
| title_full_unstemmed |
Aspiring Indonesia—Expanding the Middle Class |
| title_sort |
aspiring indonesia—expanding the middle class |
| publisher |
World Bank, Washington, DC |
| publishDate |
2020 |
| url |
http://documents.worldbank.org/curated/en/519991580138621024/Aspiring-Indonesia-Expanding-the-Middle-Class http://hdl.handle.net/10986/33237 |
| _version_ |
1764478291882803200 |