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Linking the Formal and Informal EconomyConcepts and Policies$
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Basudeb Guha-Khasnobis, Ravi Kanbur, and Elinor Ostrom

Print publication date: 2006

Print ISBN-13: 9780199204762

Published to Oxford Scholarship Online: September 2006

DOI: 10.1093/0199204764.001.0001

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Voluntary contributions to informal activities producing public goods: can these be induced by government and other formal sector agents? Some evidence from Indonesian posyandus

Voluntary contributions to informal activities producing public goods: can these be induced by government and other formal sector agents? Some evidence from Indonesian posyandus

Chapter:
(p.212) 12 Voluntary contributions to informal activities producing public goods: can these be induced by government and other formal sector agents? Some evidence from Indonesian posyandus
Source:
Linking the Formal and Informal Economy
Author(s):

Jeffrey B. Nugent

Shailender Swaminathan

Publisher:
Oxford University Press
DOI:10.1093/0199204764.003.0012

Indonesia’s posyandus are an excellent example of important local quasi-public goods (health care) produced largely by volunteers, but with crucial inputs from government and other formal sector providers. This paper identifies the circumstances under which the formal sector’s inputs are especially successful in inducing voluntary activities that contribute to both the quantity and quality of the care provided. Data from three rounds of Indonesia’s Family Life Survey (IFLS) are used to estimate the causal effect of formal sector interventions on the quantity and quality of the healthcare provided by the informal sector. The model includes posyandu and community level fixed effects so that the effect of the intervention is identified using only longitudinal variation in the extent of interventions.

Keywords:   informal sector, voluntary activities, health care, panel data, Indonesia

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