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Publication date: 14 August 2017

Rofikoh Rokhim, Sari Wahyuni, Permata Wulandari and Fajar Ayu Pinagara

The purpose of this paper is to analyze the potential of remote areas in Indonesia and find out the important variables that influence key success factors of Local Economic…

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Abstract

Purpose

The purpose of this paper is to analyze the potential of remote areas in Indonesia and find out the important variables that influence key success factors of Local Economic Regional Development (LERD) program in several areas.

Design/methodology/approach

A series of structured interviews were conducted with the chairman and staff of local government, academician, private sectors and locals who are induced to work together to improve quality of life, create new opportunities and fight poverty in Bau-Bau, Singkawang and Kupang. Subsequently, the results from the structured interviews were analyzed using qualitative analysis to arrive at the model of LERD in Indonesia.

Findings

The findings show that variables that influence the key success factors of LERD in this research are resources endowment, social capital and local support as independent variables; entrepreneurial strategy as moderating variable; and perceived performance as dependent variable.

Research limitations/implications

This study was conducted only in Indonesia which focused on local economic regional development in Indonesia. Despite this limitation, the findings of this study enable the construction of a general model that highlights LERD in chosen areas. The model is also expected to give an idea of how to develop economic region.

Originality/value

The paper adds to the literature on LERD by enabling researchers and practitioners to understand the model of LERD in Indonesia.

Details

Journal of Enterprising Communities: People and Places in the Global Economy, vol. 11 no. 4
Type: Research Article
ISSN: 1750-6204

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Article
Publication date: 8 April 2020

Ruslan Prijadi, Permata Wulandari, Putri Mega Desiana, Fajar Ayu Pinagara and Maya Novita

The purpose of this paper aims to investigate micro enterprises financing in Indonesia and examines how this financing differs, depending on the enterprise’s development stage…

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Abstract

Purpose

The purpose of this paper aims to investigate micro enterprises financing in Indonesia and examines how this financing differs, depending on the enterprise’s development stage. This research also identifies some structural problems related to micro-financing and provides workable solutions.

Design/methodology/approach

This research uses the entrepreneurial network model of Schutjens and Stam (2003) to examine how Indonesian micro and small enterprises (MSEs) evolve even before they become regular small businesses. Content analysis is used on 10 micro-enterprises from Jakarta, the capital city of Indonesia and its surroundings. Financing issues at each stage of enterprise development are identified and deeply examined.

Findings

This research not only confirms the significant financing problems micro-enterprises face but also clarifies that these problems are unique to each stage of the MSEs’ development. One insight is that most micro-enterprises do not use funding from formal institutions. That is, business owners rely more on funding from non-formal institutions. This is because these enterprises’ managers generally cannot prepare loans application and/or they are lack of knowledge/training on financing matters. They hesitate to borrow from formal financial institutions, as the rates are high but the processing time is longer than those of the loan sharks.

Originality/value

This research contributes to the field of entrepreneurial finance by identifying the structural problems inherent in micro-finance and providing workable solutions for overcoming these problems.

Details

International Journal of Ethics and Systems, vol. 36 no. 2
Type: Research Article
ISSN: 2514-9369

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