Uncovering The Spatial Variation of Factors Influencing Economic Growth: Empirical Evidence from East Java

Inequality in economic growth across regions often reflects structural imbalances and the limited effectiveness of current development policies. Thus, it is essential to investigate the factors that influence regional growth dynamics. Economic growth is defined as the change in income and the production of goods and services within a specific region or country over a designated period. The varying levels of economic growth, measured by Gross Domestic Product (GDP), are expressed at constant prices during a defined timeframe. This research aims to analyze the impact of Profit-Sharing Funds (DBH), labor, and Gross Fixed Capital Formation (PMTB) on economic growth in East Java. The analysis employs Geographically Weighted Panel Regression (GWPR) to assess how each independent variable influences the dependent variable across various districts and cities in East Java. The findings reveal three regional classifications. The first classification includes regions where none of the predictor variables significantly affect economic growth, which applies to 37 districts including Trenggalek. The second classification identifies areas where LABOR does not serve as a significant predictor variable in the same 37 districts and cities across East Java. Finally, the third classification highlights regions where Profit Sharing Funds (DBH) are significantly relevant to economic growth, with the exception of Trenggalek. Additionally, Gross Fixed Capital Formation (PMTB) is identified as a significant variable for economic growth in the districts of Lumajang, Jember, Bondowoso, Situbondo, Probolinggo, Pasuruan, Sidoarjo, as well as Probolinggo City and Pasuruan.