Income Disparity Madura Island and Surabaya City After
Suramadu Bridge Construction
Hendry Cahyono, Khoirul Anwar, Khusnul Fikriyah and Achmad Yasin
Economic Faculty, Universitas Negeri Surabaya, Surabaya, Indonesia
Keywords: Income Disparity, and Gini Ratio.
Abstract: The development of physical infrastructure is believed to reduce the number of inequality among regions. The
purpose of this study is to analyze the income inequality that occurred in four districts on the island of Madura
with the city of Surabaya after the construction of Suramadu Bridge. The calculation of inequality in this
study using Gini Ratio. The result after the construction of bridge Suaramadu gini ratio in the period 2010-
2012 in four districts of Madura Island namely Bangkalan, Sampang, Pamekasan, and Sumenep and Surabaya
fluctuate. Not much different from the conditions before the construction of Suramadu Bridge in 2003-2009.
After the construction of Suramadu Bridge, Surabaya still has better economic advantage compared to Madura
Island.
1 INTRODUCTION
In poor countries, the main concern focuses on the
dilemma between growth versus income distribution.
Both are equally important, but almost always
difficult to be realized simultaneously. Economic
development requires higher GNP, and for that a
higher growth rate is an option to take. However, the
problem is not just about how to spur growth, but who
enjoys the results. Welfare of each region is different,
one of the factors that affect the macroeconomic
conditions. Macro economic factors can grow or not
depend on the productivity of each factor (Soejoto,
Cahyono, Solikhah, 2017).
One way that is believed to reduce the number of
inequality is by way of physical infrastructure
development in the region. The development of
Suramadu Bridge is focused on balanced economic
development, which is synonymous with the focus of
national economic development strategy, where
balanced economic development strategy was
implemented in 1950-1957, but implemented in the
new order era until now (Adisasmita, 2012: 63). In
addition, the construction of Suramadu Bridge aims
to facilitate transportation routes from the island of
Madura to Java or vice versa which can further be a
trigger of economic activity.
If seen from the growth rate of GDP of four
districts in Madura Island still focused on agriculture
sector as a support in economic growth of society and
region of Surabaya also still synonymous with
industrial sector which sustains its growth rate.Equity
of income is also a final indicator of the success of
economic development. Where income distribution is
quite crucial when compared to other indicators.
Equity income also relates to the level of GNP per
capita. Prior to the construction of Suramadu Bridge,
the four districts already have a good income
distribution.
However, basically evenness on the island of
Madura is not as good as the evenness of the city of
Surabaya. Distribution of household expenditures of
Surabaya city showed even betterness than the four
districts in Madura Island. This is indicated by the
ratio of coefficient Gini city of Surabaya for 4
consecutive years are in category 4 (+) in 2005 with
the ratio 0.1944, in 2006 with a ratio of 0.1803 and in
2007 with a ratio of 0.1555. With the operation of
Suramadu Bridge is expected to generate a Big Push
for both areas.Therefore, the purpose of this study is
to analyze the income inequality that occurred in four
districs on the island of Madura with the city of
Surabaya after the construction of Suramadu Bridge.
Cahyono, H., Anwar, K., Fikriyah, K. and Yasin, A.
Income Disparity Madura Island and Surabaya City After Suramadu Bridge Construction.
In Proceedings of the 2nd International Conference on Economic Education and Entrepreneurship (ICEEE 2017), pages 305-308
ISBN: 978-989-758-308-7
Copyright © 2017 by SCITEPRESS – Science and Technology Publications, Lda. All rights reserved
305

2 LITERATURE REVIEW
Generally Revenue Distribution Indicators consist of
Gini Coefficient and Williamson Index. The Gini
coefficient description is a short measure of the
degree of inequality income distribution in a country
can be obtained by calculating the area between the
diagonal line with the Lorenz curve compared to the
total area of the square half where the Lorenz curve is
located.
The growth gap and income disparity between
regions is an unavoidable phenomenon, because the
potential, conditions, and characteristics of the region
vary from one another. The characteristics of the
region vary physically, economically, socially,
culturally, spatial, environment, and so on. Using
technological and scientific advancements and
enhancement of human resource capabilities is an
important factor for promoting economic growth
(region) and can reduce the income gap between
regions.
3 METHODS
This research is a kind of quantitative research using
secondary data. Where the data obtained from the
Central Statistics Agency of East Java. The location
of this study is the city of Surabaya, and four districts
on the island of Madura, Namely Bangkalan,
Sampang, Pamekasan, Sumenep. The data used are
secondary data with GDP data and income per
capita.The formula of Gini Ratio (GR) is:
GR = 1 - ∑f
i
[Y
i
+ Y
i-1
]
Where: fi = number of percent (%) recipients of
grade income i. Yi = the cumulative number (%) of
income in the i class.
GR values lie between zero to one. When GR = 0,
income inequality is perfect, meaning that everyone
receives the same income as the other. If GR = 1
means the inequality of perfect lame income or
income is only received by one person or one group
only. Gini coefficients from countries with high
inequality ranged from 0.50-0.70; Moderate
inequality ranges from 0.36 to 0.49; And those with
low inequality ranged from 0.20 to 0.35 (Arsyad,
2010: 291).
4 RESULTS AND DISCUSSION
The economic structure of the Madura region is
similar to that of southern East Java, as mentioned in
the results of research (Cahyono, Subroto,
Arisetyawan, 2016) that the agricultural sector has
contributed substantially to the rate of economic
growth.
Basically, the gap between regions always
happens in the development process. This is a very
universal thing and can happen at any level. Because
income data is difficult to obtain, the measurement of
income distribution has been approached using
expenditure data. The economic structure of the
Madura region is similar to that of southern East Java,
as mentioned in the results of research (Cahyono,
Subroto, Arisetyawan, 2016) that the agricultural
sector has contributed substantially to the rate of
economic growth.In general, the Gini Ratio in the
period 2010-2012 in four districts of Madura Island
namely Bangkalan, Sampang, Pamekasan, and
Sumenep and Surabaya fluctuate. Basically Gini
Ratio Fluctuation Ratio indicates a change in the
distribution of population expenditure. Gini Ratio is
also used to see whether the equality of population
expenditure is getting better or worse. Prior to the
construction of Suramadu Bridge, the four districts
have a fairly good income distribution.
Distribution of revenues of the four districts in
2003-2009 was in category 4, low inequality ranging
from 0.20-0.35 ratio. Basically, of the four districts
also exist which fall into the category that exceeds
category 4 (low inequality), but not included in
category 0 (perfect equity), with a ratio of 0.10.
Bangkalan District in the year 2003-2009 which is in
category 4 (+) is in 2007 that is equal to 0.1797.
Regency of Pamekasan which is in category 4 (+)
that is in year 2004 with ratio 0,1744 and year 2009
that is 0,1946. While Sampang Regency and
Sumenep Regency from 2003-2009 did not belong to
category 4 (+), evenness was in category 4 that is low
inequality. However, basically evenness on the island
of Madura is not as good as the evenness of Surabaya.
Distribution of household expenditures of Surabaya
city showed even betterness than the four districts in
Madura Island. This is indicated by the ratio of
coefficient Gini city of Surabaya for 4 consecutive
years are in category 4 (+) in 2005 with the ratio
0.1944, in 2006 with the ratio 0.1803, in 2007 with
the ratio of 0.1555, and in 2009 with the ratio 0.1054,
while at In 2008, the ratio of the city of Surabaya is
almost in perfect fairness of 0.0664.
After the construction of Suramadu Bridge as the
Big Project of the development of economic equity,
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the revenue distribution of Madura Island can be said
to be on the better distribution of income, than before
the Suramadu Bridge. In this case, the year range that
is used as a reference to see the condition of post
Suramadu Bridge is the year 2010-2012.The
condition of income distribution of Madura Island
after Suramadu Bridge development is quite
fluctuating. Bangkalan District in 2010-2012 is in the
category of low inequality (category 4). Where is
2010 with Gini Index 0.1958 (category 4 (+)), 2011
with Gini Index 0.2136 (category 4), and in 2012 with
Gini Index ratio of 0.2398 (category 4).
Sampang regency in 2010-2012 is in low
inequality, almost even in the Gini Index 0.10 ie
category 4 (+). Where Sampang Regency is located
in category 4, after the construction of Suramadu
Bridge is the year 2012 with Gini Index 0.2327.
While the category 4 (+) in Sampang Regency,
occurred in 2010 with the Gini Index of 0.1940 and
in 2011 with the Gini Index of 0.1932.Pamekasan
Regency after the construction of Suramadu Bridge,
with the range of 2010-2012 is almost in category 4
(+). Pamekasan Regency is in category 4 (+), ie in
2010 with Gini ratio 0.1979, and 2011 with Gini ratio
0.1993. While the ratio Gini Pamekasan regency in
2012, is in category 4 that is with the index 0.2276.
While Sumenep Regency, post Suramadu Bridge
has not indicated a better change in income
distribution. This is caused because the income
distribution of Sumenep Regency, from pre-bridge
development to post Suramadu bridge construction in
2010-2012, is in category 4. However, this is not a
bad situation, because even though the Gini Sumenep
Index score does not fluctuate, But the distribution of
district income is still in a low inequality, meaning
that it can be said that there is equality in the
distribution of income in Sumenep regency.
Not much different from the condition of pre-
development Suramadu Bridge year 2003-2009.
After the construction of Suramadu Bridge, Surabaya
still has better economic advantage compared to
Madura Island, in terms of Gini Index ratio. Ratio of
Surabaya Gini Index Post Suramadu Bridge in 2010-
2012, almost closer to perfectness. Where the perfect
fairness occurred in 2010 and 2011, with the Gini
Index of 0.0791 and 0.0510. While in 2012, the
category of Gini Index of Surabaya City is category 4
with ratio 0.1919. Among the 5 (five) regions that
became the most distributed areas of income
distribution of Surabaya city than the four districts on
the island of Madura. Although the initial focus of the
development policy of Suramadu Bridge is to
emphasize the economic progress of Madura Island.
But the economic capability of the city of Surabaya is
still far above the economic condition of four districts
on the island of Madura.
The existence of a direct relationship between the
productivity of the agricultural sector with the
distribution of income distribution reflected from
Gini Rasio. So it can be interpreted that every 1
percent increase in agricultural productivity is
expected to increase the distribution of income evenly
to the Gini Ratio. This is because the stake sector is
the dominant sector which is still the best substitution
of the profession that is in demand by the residents in
the four districts on the island of Madura. Just as the
results of Cahyono, Subroto, and Anwar, 2017 studies
suggest that in Gerbangkertosusila has some potential
sectors that can support economic development along
with the reduction of income inequality that occur,
manufacturing, mining, and agriculture.
In addition, with sufficient harvested area and a
balanced workforce with maximal workforce (in the
absence of reduced production law), it is believed to
be able to increase maximum yield. However, it
should be remembered that with the accessibility of
labor from the existence of the Suramadu Bridge, it is
certain that many of the people who have not worked
or have been working primarily in this subsistence
sector will have a desire to turn to jobs that are
capable of improving the consumption of the
population ultimately Can decrease income
inequality. Thus, with the ease of access, the residents
no longer want jobs in the agricultural sector. So that
the productivity of the agricultural sector no longer
rely on workers in the sector, but requires other
supporting factors in addition to workers who can
increase agricultural productivity. Thus, the factor of
agricultural labor does not increase, the consumption
of workers working in the sector does not increase as
well. Although the number of workers in this sector
is increasing but the people who work in this sector
have relatively low wages that are less able to
increase the consumption of the population, so the
Gini Ratio figure as a reflection of even distribution
of income increases the gap of inequality. Yet the
increase in income is one important factor to reduce
inequality. As a result of a study conducted in China
by Wei in 2011 that the wage income is still a
dominant factor of inequality in urban China (Wei,
2011).
The productivity of the industrial sector also
affects the distribution of income distribution.
Basically, productivity improvements also result in a
direct increase in the standard of living under the
same distribution conditions, from earning
productivity to labor inputs. However, it is necessary
to reexamine whether workers who are able to
Income Disparity Madura Island and Surabaya City After Suramadu Bridge Construction
307

increase productivity are increasing, able to increase
the interval of workers expenditure, at a higher level.
If this is believed to be the case, then the
interaction can take place well, resulting in growth
(growth) on the distribution of income distribution.
Thus, from that growth will result in progress
(progress) on the Gini Index value that describes the
decline in income gap. This is what is required to
occur in the area affected from the existence of
Suramadu Bridge.
Ease of access of industrial society to the
availability of raw materials can improve the
competitiveness of the population in increasing the
amount of industrial production, in order to improve
the welfare of the population and the regional
economy in general. It should also be noted, however,
that increased productivity of the industrial sector can
also increase the rate of open unemployment. The
competitiveness of the increasingly open population
mobility in the Madura-Surabaya region is able to
shift the less productive population to the highly
competitive population especially in the industrial
sector. If that happens, then it will also affect the
consumption of public spending. It is able to increase
the value of Gini Ratio in the affected area. But
another important thing to note again, is the value of
wages received by industrial sector workers. Fuest
and Huber, 2006 show that nvestment subsidies in the
poor region can improve welfare if the labor market
is competitive. So with the rational wage rate can
increase the expenditure of the population in that
sector, in such condition, it can decrease the Gini
Rasio figure in the affected area due to the existence
of Suramadu Bridge.
The existence of a positive relationship between
changes in agricultural productivity and productivity
of the industrial sector on the distribution of income
distribution. In addition, it is known that the areas that
have the biggest distribution of income distribution
are Surabaya, Sampang, and Bangkalan. While that
has the smallest distribution of income distribution
distribution is Sumenep and Pamekasan. This is
because Bangkalan Regency and Sampang Regency
have a considerable amount of agricultural
productivity and the three regions have high
productivity of industrial sector. In addition, the three
areas are located not too far from the presence of
Suramadu Bridge. While Pamekasan and Sumenep
regency are remote regency, with the existence of
Suramadu Bridge and has big agricultural
productivity value but not balanced with growth in
productivity of industrial sector. Therefore, it is
assessed will affect the distribution of income
distribution in the region. In contrast to the results of
Kemp-Benedict research 2011, which says the
Analysis of Inequality in Income Negative
Relationship with the Level of Social Trust. If there
is a relationship between income. This study did not
include elements of social trust.
5 CONCLUSIONS
Sumenep and Pamekasan districts, post Suramadu
Bridge have not indicated a better change in income
distribution. Sampang Regency is in a low inequality.
Bangkalan regency fluctuates. However, it is still in a
low inequality. The city of Surabaya still has a better
economic advantage compared to four districts in
Madura Island.
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