INFANT MORTALITY AND NATIONAL INCOME IN INDONESIA: A PANEL DATA ANALYSIS

Rudi Salam rudisalam@stis.ac.id

Income is an important factor affecting the health either directly or indirectly. Higher income levels has established a condition that can affect the quality of life as the fulfillment of goods of good quality, housing and sanitation conditions are better. Thus, income is an important factor affecting the level of health substantially. Many studies both cross section and panel data support the view that there is a statistically significant relationship between income and health status. One of the main indicator used to look at the health status of the population is the infant mortality rate (IMR). IMR is a factor that can be attributed to the well-being of the population. High IMR may reflect improper childcare. A population with a sick baby is not growing healthy and will form the adult population susceptible to disease and will impede economic progress in many ways: it decreases the productivity of workers; do not allow the use of natural resources which should be accessible in good health; it hurt the next generation by reducing the number of children in school, and, ultimately, improve the medical care expenses, rendering the inefficient allocation of resources. Health conditions that increase (clearly manifested in the form of a low infant mortality rate) lead to superior economic performance at the national level. This study will examines the relationship between the regional gross domestic product (RGDP) per capita as a proxy of national income and IMR. To reveal the relationship between RGDP per capita and IMR, a quantitative model is established which indicates the level of infant mortality as a function of RGDP per capita. The basic assumption is incorporated into the model, which means that RGDP per capita has a strong influence on the IMR but it does not work otherwise. In addition to the variable RGDP, IMR is also controlled by variable female labor force participation rate and fertility rate. Statistical methods used in this research is panel data model of provinces in Indonesia between the years 1990-2012. The data used were obtained from the publication of the BPS-Statistics Indonesia and processed using STATA. The study shows that the RGDP per capita has a negative and significant impact on infant mortality well as be a predictor alone and combined with other predictors. The fertility rate has a positive effect on infant mortality. As for variable levels of female labor force participation has no effect on infant mortality. As a conclusion, RGDP per capita and fertility become a major determinant of infant mortality in the province in Indonesia between 1990 and 2012. We hope that the results of this study provide useful information for health policy makers better understand the key factors that affect infant mortality. Keywords : Infant mortality, Regional GDP per capita, Panel data.