International Journal of Economics, Business and Management Studies

Volume 6, Number 2 (2019) pp 366-377 doi 10.20448/802.62.366.377 | Research Articles


The Role of Regional Autonomy in Poverty Reducing in Kediri City, East Java - Indonesia

I Gedhe Heru Marwanto 1
1 Lecturer at Magister Administration Science, Faculty of Social and Political Science, University of Kadiri, Indonesia.


Regional autonomy provides excellent dedication to poverty reducing, especially to realize equity and distribution justice for the poor. As one of the pilot areas, the City of Kediri received much appreciation from the government because of their strategic programs in poverty alleviation. Not without reason, poverty alleviation is an annual agenda of the Indonesian government that continues to experience ups and downs, especially in the face of inflation that is increasingly clear in plain sight. The role of regional autonomy is one of the government's efforts to encourage progress and gain the potential of existing resources, especially productive people and natural resources. The research was conducted based on a literature study to reveal the role of regional autonomy in Kediri City. As an autonomous region that has a variety of potential resources and is able to reduce poverty levels in the region, it will be quite interesting to know the role of local governments in poverty reducing. The results of the study mentioned that the efforts of local governments have a positive role in poverty alleviation through various excellent programs and cooperation of all related parties.

Keywords:Regional autonomy, Government governance.

JEL Classification: D63.

DOI: 10.20448/802.62.366.377

Citation | I Gedhe Heru Marwanto (2019). The Role of Regional Autonomy in Poverty Reducing in Kediri City, East Java - Indonesia. International Journal of Economics, Business and Management Studies, 6(2): 366-377.

Copyright: This work is licensed under a Creative Commons Attribution 3.0 License

Funding : This study received no specific financial support.

Competing Interests: The author declares that there are no conflicts of interests regarding the publication of this paper.

History : Received: 12 August 2019 / Revised: 19 September 2019 / Accepted: 21 October 2019 / Published: 28 November 2019 .

Publisher: Online Science Publishing

Highlights of this paper

  • With the well-organized regional autonomy, it will be able to alleviate poverty by equitable distribution for the poor.
  • Through regional autonomy, existing resources can be managed optimally, especially for the people.
  • The flagship program of regional autonomy in the City of Kediri has actually had a positive impact on the people in the region dan kerjasama dari para stakeholder.


Nationally, the number of poor people in Indonesia is 9.82 percent, or about 10.18 percent of the population of the total 17.67 million population of Indonesia. As for the island of East Java, it reached 10.98 percent. Based on data from the united nations development program (UNDP), the Indonesian human development index (HDI) ranked 124 out of 187 countries in 2011. The high poverty rate ranks Indonesia as the 68th poorest country in the world. This indicates that the government must strengthen the quality of community and environmental resources to be able to be independent and ready to compete in the global market.

The implementation of decentralization and regional autonomy policies through Law 22 of 1999 concerning Regional Government divides the number of districts, cities, sub-districts, villages and villages continuously to increase. The area for rural areas is around 82 percent in the territory of Indonesia and there are around 13.18 million people. The current reality, the Poverty Severity Index and the Poverty Depth Index in Indonesia are experiencing tidal changes. The indications are the narrow field of work in areas in remote areas, especially rural areas, the condition of the community which is mostly traditional farmers and laborers, minimal wages, narrow land access and inadequate capital (Murdiansyah, 2014).As a result, this territorial autonomy is increasingly implemented as a tool poverty alleviation. Schulte (2018) support the statement that regional autonomy is a very useful tool for managing conflicts that exist in a particular region or region. According to him, the more regional autonomy the better, especially in the success of reducing conflicts of various dimensions, especially economic and ethnic. Siroky and Cuffe (2015) states about various complaints due to autonomous status. Revocation of autonomy can weaken the ability of the government to make credible future commitments for the improvement of various public complaints. The role of regional autonomy is very important in this case if used as well as possible.

As one of the regions of regional autonomy, the local government of the City of Kediri has various poverty alleviation programs in the context of realizing the welfare of its people while helping to reduce poverty rates in Indonesia. The focus of regional autonomy performance requires a lot of collaborative efforts from stakeholders, especially those involved in the field of industry and other potential sectors.

For decades, the City of Kediri demonstrated independence and positive development in poverty alleviation. According to data from the Central Statistics Agency in 2019 the City of Kediri was able to reduce the percentage of poverty figures with the community empowerment program. After the implementation of decentralization and regional autonomy, the amount of the flow of funds for community empowerment is quite a lot, especially to carry out various programs related to poverty alleviation problems. APBD Local governments must always be considered because without realizing that a large management of the local budget if it is not proportional to the incoming funds cannot guarantee that the situation of the government has become better overall. In addition, the position of the Regional House of Representatives (DPRD) which is stronger after regional autonomy so far should be able to encourage the improvement of local government services to the public. Concerns about the emergence of individualism can lead to negative perspectives from the community and can be a conflict of social inequality. Based on the mission of Kediri Regency Government in 2019, prioritizing human resource development is a priority.

The impact of regional autonomy can be done by comparing the results of the regional autonomy performance of the city of Kediri before and after the enactment of the policy through indicators of certain dimensions. Performance of local government services can be reflected in the sectoral allocation policy in the Regional Budget (APBD). It is important to optimize all efforts to reduce poverty. As one of the regional autonomy regions that is quite successful, Kediri City is able to deliver its people to be productive through joint ventures. However, this does not mean heedful of the strategic steps that must be continuously monitored and evaluated every year in order to ensure poverty reduction programs are on target. The problem is, it's not easy to do that. Build society to be productive and launch various regulations related to poverty alleviation programs that are right on target without the right management strategy. In addition, according to the results of research conducted by the Smeru REsearch Institude (2002) on the impact of decentralization and regional autonomy on the performance of public services states that there are several issues that must be considered in assessing the performance of regional autonomy, namely; the attitude of overriding coordination in aspects of government administration and development, the imbalance between institutional structures and operational aspects, the implementation of public services that have not been maximized, and the realization of clean and fair governance as well as good governance. This study raises these problems and provides various literature studies to see the role of regional autonomy in the City of Kediri in poverty alleviation.


2.1 Regional Autonomy

Regional autonomy is the right, authority and obligation of autonomous regions to make rules and manage all government affairs and community interests based on laws and regulations that apply in the legal community unit that has territorial boundaries. The legal basics of regional autonomy in Indonesia are; 1) The 1945 Constitution of the Republic of Indonesia Article 18 Paragraphs 1-7, Article 18A paragraphs 1 and 2, and Article 18B paragraphs 1 and 2; 2) RI MPR Decree Number XV / MPR? 1998 concerning the Implementation of Fair Regional Autonomy, and financial balance between the Central and Regional Governments in the NKRI Framework; 3) RI MPR Decree Number IV / MPR / 2000 concerning Policy Recommendations in the Implementation of Regional Autonomy; 4) Law Number 32 of 2004 concerning Regional Government; 5) Law Number 33 of 2004 concerning Financial Balance between the Central Government and Regional Governments; 6) Law No. 23 of 2014 concerning Regional Government (Revised Law Number 32 of 2004).
The main objective of regional autonomy is in order to improve the welfare of the community and encourage the realization of an increase in the index of human development by providing good services to the community, developing democratic life, social justice, equity, maintaining unity relations, empowerment, and fostering initiatives and creativity and the role of the community and the functions of the Regional House of Representatives (Wikipedia, 2019).

It should be noted that there is no difference in the average regional autonomy between regions in terms of the proportion of regional income, budgeting performance, and regional growth. This means that with regard to financial performance there is no difference in the degree of independence in regional autonomy. The proportion of regional income, financial performance area, and district / city development does not show an influence on the level of independence in autonomy (Raza et al., 2018).

2.2. Poverty Reducing

Poverty is a challenge facing all countries and the international community as a whole. Promoting development, narrowing the gap between villages and urban areas, eliminating poverty and achieving shared prosperity are the ideals of humanity. It is important to understand the roots of poverty and build a scientific system of poverty assistance. A study revealed that the distribution of the rural poor shows a different spatial agglomeration feature. Poverty is largely concentrated in remote areas and access difficulties such as border areas and mountainous areas. This problem results in uneven distribution of services from local governments. Further investigation indicates that lack of natural resources, island effects, poor geographical conditions, and fragile ecological environment are the main driving forces behind continuous poverty (Liu et al., 2017).

A theoretical framework by Xu et al. (2019) uses weighted geographical indicators to support this finding. Analysis was conducted to explain the factors underlying spatial poverty indicators. The results show that the average slope and density of the road network have the most statistically significant correlation with the ratio of poverty levels in the City. Especially in remote areas.Whereas cities with higher density of road networks have lower poverty ratios due to the convenience of transportation.

The autonomy region in various districts / cities in Indonesia is relatively affected by various factors, especially the impact of the global economy such as inflation. However, the findings of Yang and Zhang (2016) indicate that regional development has been underdeveloped due to climate impacts and environmental aspects. Poverty has become an important factor that has hampered economic development. Their findings further introduce poverty alleviation activities into six sections: 1) introduce the background to poverty alleviation, 2) analyze the problems that exist in poverty alleviation work, 3) explain the importance of applying appropriate poverty alleviation, 4) summarize the ideas and guiding principles the basis for poverty alleviation work that occurs, 5) presents some balsan actions and suggestions, and 6) to then summarize it as an evaluation.

Based on economic theory, entrepreneurship and poverty alleviation have a positive relationship. First, entrepreneurship in urban and rural areas generally can facilitate poverty alleviation. Second, the correlation between entrepreneurship and poverty alleviation in urban areas is significantly stronger in developed areas than in remote and disadvantaged areas. Third, the level of financial development in an area can moderate the effect of entrepreneurship on poverty alleviation (Lin et al., 2019). In other words, this shows that entrepreneurial activities in developing economies have a stronger effect on poverty alleviation in the regions. urban rather than helping less developed or rural areas. The government instituted policies to improve the business environment in rural and backward areas to the maximum extent possible. In particular the strengthening of the capital system in various aspects and poverty alleviation programs.

Based on the merging of the historical dimension of policy and the analysis of experience on realistic material, Liu et al. (2018) discuss major policy changes regarding the development of rural poverty reduction that have experienced or are experiencing various challenges due to government policy shifts. First, in poverty alleviation policies, genuine poverty oriented to aid shifts to development oriented poverty; Second, in poverty alleviation targets, groups from the regions and districts turn to poor villages and households; Third, in poverty alleviation strategies, flood irrigation goes to targeted poverty alleviation; Fourth, in terms of social mobilization, government poverty alleviation shifts to social poverty alleviation; and Fifth is the main position about poverty from passive to active. This shift has been verified in experience material. However, there are still several other problems, namely the short-term benefits of poverty-based project-based poverty reduction, participatory paradoxes, and governance dilemmas.


The conceptual framework of the study examines the problem of poverty alleviation by local governments in the City of Kediri. Various efforts have been made to empower the poor. In this case the Regional Development Planning Agency continues to strive to do strategy management for this purpose. Therefore, the role of research and study is very important. According to Sugiyono (2011) "Descriptive qualitative research methods are based on the philosophy of post positivism. This method is used to explain more deeply the impact of poverty alleviation programs carried out by the City of Kediri from 2009 to 2019. In qualitative research the results of research analysis do not depend on numbers, but data analysis on various perspectives compiled through the process of data collection , testing the validity of the data, interpreting the data and constructing the theory (Purhantara, 2010). The type of data used is secondary data obtained from the Central Statistics Data Agency and the official website of the City of Kediri.


4.1.Policies of the Central Government and Regional Governments inPoverty Reduction

Presidential Regulation No. 15 of 2010 concerning the Acceleration of Poverty Reduction as a form of Government intervention to improve the effectiveness of poverty reduction. "This acceleration effort formed the Poverty Reduction Coordination Team (TKPK) at the Provincial and Regency / City levels. The teamwork mechanism is regulated in the Minister of Poverty Reduction (TNP2K) regulation which is a coordinating forum at the national level. "The task of the Regency TKPK is contained in article 10 of the Minister of Home Affairs Regulation No. 42 of 2010 concerning the Provincial and Regency / City Poverty Reduction Coordination Team that is coordinating and controlling the implementation of poverty reduction. Regency TKPK has the obligation to submit an Annual Report on the Implementation of Regional Poverty Reduction (LP2KD). This report will be useful as a material for evaluating policies and developing development plans and optimizing the future targets (Susilowati, 2018).

The poverty reduction programs and programs are based on regional regulations as stipulated in the regional autonomy authority as stipulated in the Regional Regulation / Regulations Head of District Head Decree No.188.45 / 140 / 418.08 / 2017 2017 About the Kediri Poverty Reduction Coordination Team as shown in the following Figure 1:

Figure-1 . Kediri City social assistance program and poverty reduction efforts group.

Source:Susilowati (2018).

The poverty alleviation programs and activities in the City of Kediri as shown above consist of four groups namely; 1) Family-based integrated social assistance group program aimed at fulfilling basic rights, reducing the burden of life, and improving the quality of life of the poor, 2) community-based empowerment groups aimed at developing the potential of human resource development, 3) Groups based on empowering MSMEs to provide access and strengthening the community's economy to be independent, and 4) Group poverty reduction programs directly and indirectly to increase the standard of living of the middle-to-bottom economic community.

The findings presented by Susilowati (2018) state that there are four strategic indicators that can be carried out through regional regulations (Regional Regulations and Regulations) in order to optimize poverty reduction, among others; 1) program planning or activity activities that must begin with focused analysis and determinant analysis of the problems in each indicator of poverty dimensions, 2) planning of programs / activities based on integrated poverty database (BDT), 3) determination of target areas through quadrant analysis to determine priority areas, especially in remote areas and poverty-prone areas, and 4) between programs / activities show complementarity of programs / activities. Furthermore according to Susilowati, the City of Kediri is currently very dependent on external parties in financing its programs.

4.2. The Impact of the Poverty Alleviation Program in Kota Kediri

Kediri City is one of the regional autonomy regions that received the best TPID in Java-Bali in 2017 and 2018, received the best City Award for Regional Development I and the top 10 best city-level planning, achievements & innovations in 2019, and the City Response Index award Narcotics Threat (IKoTAN) ranks 2 out of 173 regions with an index of 78.42 percent which is in the response category (Website Resmi Kota Kediri, 2019). This success makes the Regional Government to be more active in order to optimize poverty alleviation programs. Seeing that the percentage of poor people in the City of Kediri has decreased compared to the previous year by 8.49 percent. However, this figure is still far below the East Java Province at 11.2 percent and national at 10.12 percent. The results of Schulte (2018) in 2017 conducted in the City of Kediri indicated that the percentage of poor people in Kediri District since the last five years experienced an average of 0.28 percent per year and a decrease of 0.47 percent or approximately 19 thousand inhabitants for 2017.

Table-1. Poverty line and percentage of poor population in kediri city in 2011-2016.
Poverty line (Rp)
Percentage of poor population (%)

Source: Statistics Indonesia, 2018.

Based on data from the Central Statistics Agency (BPS) of the City of Kediri the poverty rate from 2009 to 2018 was successfully suppressed to the lowest in the history of this city. Since 2009, the City of Kediri has always been on average more than 8 percent, and the highest in 2009 was 10.41 percent. According to BPS Chairman Ellyn T. Brahmana that the 2018 poverty rate has decreased to 7.68 percent compared to 2017 by 8.49 percent. Several influencing factors include stable and relatively low inflation rates and increased economic growth (Saputro, 2019). Furthermore, according to him, the role of regional autonomy is very important, especially the pattern of performance such as in 2018. "With the target of the right regional autonomy performance such as distribution of rice poor on target and controlling well controlled inflation so that people's purchasing power remains stable. BPS data shows that the indication of poverty reduction can be seen from the poverty limit indicator in Kediri City, which is the number of Raskin recipients, in 2017 there were around 24,70 poor people, while in 2018 it decreased to 21,900 poor people. If in the year 2-17 the poverty limit was Rp 420,712 per capita / month, in 2018 it would increase to Rp 453,807 per capita / month.

Economic growth from the open unemployment rate Kota Kediri since 2017 has decreased by 4.68 percent to 1.05 percent. In addition, non-tobacco industries reached 7.02 percent, an increase of 0.80 percent from 2017 of 6.22 percent. As for the inflation rate of 1.97 percent or decreased compared to 2017 which was 3.44 percent (Rahayu, 2019).

The following is a table of poverty line data and the percentage of poor people in the City of Kediri since 2011-2016 obtained from the Central Statistics Agency of Kediri in 2018.

Abdullah Abu Bakar, Mayor of Kediri said that, "The reduction in poverty is due to the role of good cooperation between regional autonomy, the central government and the people. The government has indicator points. Community members are given programs to reduce poverty. And the city government can follow it up on target. "Some of the Kediri City Government Programs that are used in poverty alleviation include: 1) Temporary Community Direct Assistance (BLSM), 2) Inappropriate Houses (RTLH), 3) English Massive in order to improve quality children's education, 4) food awareness and food safety programs, 5) community empowerment programs (Prodamas), 6) social assistance (social assistance), 7) movements to suppress maternal and infant mortality (Gemakiba), 8) health insurance (Jamkesda) and free schooling for the poor, and 9) assistance for patient family accommodation.

Based on the results of research conducted by Susilowati (2018) that indicators of poverty alleviation achievement in the City of Kediri can be seen from various dimensions as in the following Table 2:

Table-2. Various dimensions of poverty alleviation indicators in the city of Kediri.
Economic and employment dimensions
Seeing the achievements and development of the number of poor people; poverty depth index; and poverty severity index. Whereas the labor dimension is seen from the level of open unemployment and underemployment.
Educational dimension
Seeing the achievements of the educational dimensions indicators in a certain period of time. For example Indokato APK SD / Mi and APtS.
Health dimension
The development of achievements can be seen from the indicators of IMR, MMR and the proportion of childbirth.
Dimensions of infrastructure / basic infrastructure
Viewed from the indicator of the proportion of households with access to basic sanitation that is sustainable households with access to electricity (PLN and Non-PLN); indicator of the proportion of households with self-ownership status; and the indicator of the house is not livable.
Dimensions of food security
The achievement can be seen from the indicators of food security in the form of basic necessities such as rye sugar, chicken meat, and several other commodities.

Source: Susilowati (2018).

4.3. Strategy Management and Optimization of Poverty Reducing Programs

The City of Kediri has a Poverty Reduction Coordination Team (TKPK). This team has the task to coordinate cross-sectoral in the implementation of poverty reduction and to control all implementation of poverty reduction regulations and programs in the region. The efforts made by the regional government in this case consist of two categories. First, rescue (rescue efforts, i.e. efforts made in the short term aimed at saving poor households in order to survive (charity) due to economic factors that are volatile such as increases after BMM. Second, recovery (recovery phase) which is an effort long-term, revolving and must be right on target, institutional strengthening, development of economic facilities and infrastructure in the rural communities of the city of Kediri, and enhancement of human resource capabilities.

Local governments through all village apparatus organizations (OPD) carry out the stages of poverty alleviation efforts through TKPK in two task classifications namely 1) control and evaluation, and 2) handling public complaints. The following is a scheme for controlling and evaluating poverty reduction and handling community complaints in the City of Kediri;

Figure-2. Kediri city TKPK activities.

Source: Susilowati (2018).

According to Susilowati (2018) monitoring and evaluation of poverty reduction that has been carried out by the regional government through TKPK consists of two activities namely monitoring and evaluation of programs in each Regional Apparatus and the achievement of indicators (outcome) of poverty from various dimensions that have been explained in the previous point . As for the model used, there are four types; 1) survey as a model for gathering relevant information; 2) participatory to obtain information by involving respondents intensively and direct observation; 3) budget analysis of program expenditure items; and 4) site visits to obtain information quickly from programs that have been implemented. Every year, the TKPK Kota Kediri District carries out the TKPK activities to ensure that the programs are right on target and optimal.

Poverty alleviation programs which are implied so that welfare inequality can not be evaluated to increase the role of community empowerment and strengthening regional autonomy institutions including by; 1) develop effective institutional strengthening and management strategy patterns for example by approaching business groups through MSMEs and village unit cooperatives, 2) compiling recommendations for implementing effective community empowerment based poverty alleviation programs in the City of Kediri, and conducting training design for community leaders real figures in society (Murdiansyah, 2014).

Policies taken by the regional government must always hold the principle of caution, especially in making regulations related to poor communities. In early 2017 due to the revocation of the 900 watt electricity subsidy policy, an increase in the percentage of poor people (Chusna, 2018) Kediri City Government now also provides licensing facilities so that many investors are starting business startups in this region. As long as they have to meet the labor requirements, they must be prioritized from residents of the City of Kediri (Rahayu, 2019)

The poor community empowerment model uses a group approach developed by Aniyati and Alfiah (2018) as follows Figure 3:

Figure-3. Poverty alleviation model based on individual character.

Source: Aniyati and Alfiah (2018).

Internal empowerment can be done by increasing the bargaining value (labor wages) by improving the quality of human resources and awareness to limit consumptive and unproductive cultures. Whereas external empowerment can be done by conducting alternative business training (diversification of productive activities) (Aniyati and Alfiah, 2018). The Productive Activities Program conducted by the Regional Government of the City of Kediri is based on three approaches namely; 1) the Community based development approach, 2) the basic approach of the similarity of objectives, activities and domicile areas in the framework of efficiency, effectiveness and social capital growth, and 3) the Joint Business Group (KUBE) approach in managing Productive Economic Enterprises.

One development of the poverty alleviation program is to empower the Micro, Small and Medium Enterprises (MSMEs) sector by providing venture capital assistance with lower administrative costs (Dai et al., 2017) and developing partnerships for productive businesses (Kuhn et al., 2016). This activity is also supported by the findings of Rini (2015) where there are four strategic steps that can be used by local governments through the provision of cooperative capital, namely 1) providing access to independent capital; 2) building adequate facilities and infrastructures for community business activities; 3) broader marketing development including using online media; and 4) empowering human resource resources, for example by providing employment training.

Next the economic empowerment model of the poor based on the dimensions of food security is as follows Figure 4.

Figure-4. Economic empowerment of the poor based on food security dimensions.

Source: Aniyati and Alfiah (2018).

Economic Empowerment of the poor through the dimension of food security is done by increasing the role of active community participation in sustainable development and maintaining the commitment of local governments in poverty alleviation and food insecurity. The collaborative role of the three indicators of the dimensions of food security will be able to support the improvement of welfare and food security based on productive local potential in the City of Kediri.

The findings of Rudenko et al. (2015) reveal that to reduce poverty that enters the autonomous region there are strategies that can be implemented namely 1) focus both on the quantity of growth (ie, on achieving high growth rates) and on the quality of growth (ie, who benefits from that growth). By calculating the trade-off index of growth inequality assuming that per capita income follows a two-parameter lognormal distribution. Using the interpolation method as an analysis tool and the OLS method used for income ranges and calculation of poverty values ​​based on the selected curve. The results show that poverty indicators in relatively rich and high inequality areas are more sensitive to changes in distribution than changes in average. And at the same time, poverty levels in regions with low incomes and relatively low inequality are more responsive to economic growth than changes in inequality.

In the establishment of a poverty alleviation demonstration zone, utilization and development as a tourist destination can be a local tourist attraction. As part of tourism products, tourism commodities are not only an important indicator for the creation of pilot areas, but also a major link for resource utilization and poverty alleviation (Shuai, 2018).

Ending poverty in all its forms is the goal of sustainable development. The problem that often arises is in the definition, measurement, data collection, and determination of poverty criteria and indicators. A model as a management approach to decision making strategies in overcoming the problem of poverty alleviation focuses on decentralized management at the district level as local governments that serve directly with their communities. Model of integration of poverty data management with a multi-criteria decision making (MCDM) method in a management system framework that can manage data criteria and indicators, data sources, poverty alleviation program data, and community data. The usefulness of this model is; 1) This database model is needed as part of efforts to ensure the accuracy of the distribution of subsidies provided by the government to the poor, 2) in the context of the audit program, the database model can be used as a means to verify the truth of poverty information, and 3) reference in preparing the basis poverty data needed as part of efforts to ensure accuracy (Budiman et al., 2018).


This research describes in detail the strategies that can be carried out as an effort to reduce poverty. The role of regional autonomy in Kediri is considered very important to see that until this decade the government has succeeded in making efforts to make the community more productive. Kediri City Government has a variety of excellent programs that should be appreciated by the government. Apart from the aspects and dimensions that have been explained in the discussion, it should be added that technological progress becomes a challenge that is quite strong and requires special attention from the government of otoda. Previous research offers various forms of models and approaches as management strategies that can be used. Of course it takes the cooperation of all parties to encourage equitable welfare in the future.


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About the Authors

I Gedhe Heru Marwanto
Lecturer at Magister Administration Science, Faculty of Social and Political Science, University of Kadiri, Indonesia.

Corresponding Authors

I Gedhe Heru Marwanto

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