Infrastructure and human development: the case of Java, Indonesia

This study examines the relationship between infrastructure and human development in Java, Indonesia, using regency-level 2002-2005 panel data. We find that improving infrastructure significantly enhances human development. In particular, electricity infrastructure has a greater influence on human development than other types of infrastructure, such as clean water, roads or the number of classrooms per student. We find that for every 1% increase in the proportion of households with electricity, the human development index (HDI) increases by 0.2%. Improvements in other types of infrastructure lead over the long run to lesser increases in the HDI, ranging from 0.01% to 0.03%.