THE RELATIONSHIP BETWEEN SOCIAL ASPECTS AND PRODUCTIVITY TOWARDS SUSTAINABLE ECONOMIC DEVELOPMENT IN INDONESIA

Abstract

The interplay among life sustainability indicators, education, health, and enduring economic development exhibits mutually reinforcing dynamics. The present study quantifies these interdependencies within the Indonesian context, utilising the vector error correction model (VECM) framework over a two-decade span from 1999 to 2022. The evidence generated underscores the significance of contemporaneous and lagged interrelationships. Economic expansion, oriented towards sustainability, consequently catalyses enhancements in the educational system, thereby elevating productive capacity. Concomitantly, the increment in national income expands the fiscal space required to guarantee comprehensive and equitable healthcare access, resulting in a healthier labour force. As the populace engages with augmented educational and health inputs, life expectancy and per capita productivity both experience upward movement. Taken together, these mechanisms substantiate a policy agenda that prioritises improved, equitable access to educational and healthcare services as a cornerstone of durable economic development