Poverty Dynamics in ASEAN: The Role of Human Capital and Taxes in Shaping the Economic Future

Abstract

This research aims to analyze the influence of poverty levels, carbon dioxide emissions, industrialization processes, tax systems, and investment in human capital on poverty levels in ASEAN member countries, focusing on threshold values and poverty persistence coefficients to identify effective interventions. Using a dynamic threshold panel data model, the study evaluates 11 ASEAN member countries from 1999 to 2022. The results show that the human capital index is a critical variable in poverty analysis, with a significant threshold value of 1.881, indicating its substantial impact on poverty levels. The persistence coefficient of 1.112 highlights the yearly persistence of poverty, underscoring the need for timely and effective interventions. High carbon dioxide emissions and industrialization coefficients suggest that uncontrolled industrial growth could exacerbate poverty, while significant negative coefficients for taxes and human capital suggest that improvements in these areas could reduce poverty. This study contributes new insights by integrating dynamic threshold analysis in the ASEAN context, offering a fresh perspective on the relationship between human capital, economic factors, and poverty.