An Exploratory Analysis of Micro-Small Industries in Village Levels in Papua Province

Abstract

The industry's existence is essential to drive economic development in a region, particularly at the village level, the smallest area where the industry is located. Therefore, it is crucial to determine the factors influencing the micro-small industry (MSI) in the village area. This study involves 759 villages in Papua and analyzes it using the Classification and Regression Tree (CART). The data are taken from a Potential Village Survey conducted by BPS-Statistics Papua in 2018. This study shows that the village with the industrial centre tends to have a higher number of MSI. Simultaneously, the village that does not have an industrial centre and does not have adequate transportation facility tend to have the lowest MSI quantity. The number of MSI will increase in line with the village head's education level and an adequate transportation facility. Based on this finding, three suitable suggestions need to be executed to encourage MSI's growth in each village. First, the government needs to provide the industrial zone to support MSI's existence and development in the village area. Secondly, connectivity between the industrial village needs to be paid attention to by building the road and other support transportation facility. Thirdly, the government needs to provide more assistance for the village heads in managing government and designing policy, especially those who do not have a higher education background.