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Article

Model Testing and Contribution of Antecedent Variable to Absolute Poverty: Low Income Family Perspective in Indonesia

by
Hasmin Tamsah
1,*,
Gunawan Bata Ilyas
1,
Jumiaty Nurung
1 and
Yusriadi Yusriadi
2
1
Management Department, Sekolah Tinggi Ilmu Ekonomi Amkop, Makassar 90231, Indonesia
2
Public Administration Department, Sekolah Tinggi Ilmu Administrasi Puangrimaggalatung, Makassar 90271, Indonesia
*
Author to whom correspondence should be addressed.
Sustainability 2023, 15(8), 6894; https://doi.org/10.3390/su15086894
Submission received: 20 December 2022 / Revised: 8 April 2023 / Accepted: 18 April 2023 / Published: 19 April 2023
Browse Figure
Versions Notes

Abstract

:
Poverty is a classic problem that is never solved except with comprehensive efforts by looking at the problem from various perspectives. This study aims to analyze from the perspective of low-income families the role of short-term vision and uncontrolled consumption as antecedents of absolute poverty. This study used a quantitative approach, using SEM-Amos version 23. The population in this study was all low-income families in South Sulawesi, especially in six districts, namely Makassar City, Jeneponto District, Selayar Islands District, Bone District, North Luwu District, and North Toraja District. The sampling technique was random through 201 heads of households who filled out the questionnaire and were declared complete from low-income families in the six districts. The results of data analysis show that compared to short-term vision, uncontrolled consumption is an antecedent that has a major influence on increasing absolute poverty. This study’s results show a positive and significant contribution of short-term vision to uncontrolled consumption. Partially, uncontrolled consumption is also able to mediate the effect of short-term vision on absolute poverty. Family behavior can be an influential factor in increasing absolute poverty. The family’s ability to overcome internal and external obstacles will reduce the possibility of the family being trapped in absolute poverty.

1. Introduction

The main problem of the third world today, apart from COVID-19 [1] is poverty. Poverty is a condition experienced by most people in developing countries [2,3], including Indonesia. The data in Table 1 shows fluctuations in changes in poverty in Indonesia, especially South Sulawesi; although some districts have experienced a decrease, overall, 2020–2021 has increased.
Poverty is a classic problem that is never solved except with comprehensive efforts by looking at the problem from various perspectives. Some research on poverty looks at the problem from a macro perspective so that all countries always look at economic growth. The measure of prosperity is seen from how the country controls the economy with the assumption of growth [4,5,6,7].
Table
Table 1. Percentage of Poor People in South Sulawesi in the Last Three Years.
Table 1. Percentage of Poor People in South Sulawesi in the Last Three Years.
DistrictPercentage of Poor Population by District in South Sulawesi (Percent)
201920202021
Kepulauan Selayar12.8312.4812.45
Bulukumba7.267.107.43
Bantaeng9.038.959.41
Jeneponto14.8814.5814.28
Takalar8.708.448.25
Gowa7.537.387.54
Sinjai9.149.008.84
Maros9.899.749.57
Pangkep14.0613.9614.28
Barru8.578.268.68
Bone10.0610.6810.52
Soppeng7.257.597.53
Wajo6.916.956.46
Sidrap4.795.055.04
Pinrang8.468.868.81
Enrekang12.3312.1712.47
Luwu12.7812.6512.53
Tana Toraja12.3512.1012.27
Luwu Utara13.6013.4113.59
Luwu Timur6.986.856.94
Toraja Utara12.4112.0111.99
Makassar4.284.544.82
Pare Pare5.265.445.40
Palopo7.827.858.14
Sulawesi Selatan8.698.728.78
Source: Adapted with permission from Ref. [8].
Economic pressure hinders a person’s social, emotional, biological, and intellectual development; it is not merely a financial nuisance. Individuals and families are more susceptible to additional risk factors when they encounter economic stress, defined as being unable to afford housing, food, clothing, health care, or household goods. In addition, those living in poverty may be required to seek welfare assistance, an unpleasant experience due to the widespread stigma associated with such programs in the United States. In an economically materialistic and aspirational society, families are also driven to discover varied and often embarrassing methods to cope, make meaning of who they are, and redefine the place of their children.
Views on poverty can be seen from several perspectives, including six perspectives through theory, namely the theory of cultural beliefs, the theory of individual deficiencies, political and social distortions, the theory of economics, the theory of cumulative and cyclical dependencies, and the theory of geographical disparities [9]. Then another view suggests that there are three groups: behavioral theory, structural theory, and political theory [10]. In addition, they have similar views because they only categorize into three groups.
These six basic theory perspectives are the basis for each country to solve the problem of poverty. The differences between experts on the underlying views of poverty have formed a debate, for example, the individual poverty theory, which focuses on individual problems that lead to poverty, such as attitudes, morals, and participation [11]. It further explains that it is individuals’ hard work and responsibility to obtain their basic needs. However, it was considered irrelevant with the eugenics in the nineteenth century that sterilized those with limited abilities [11]. Furthermore, it was found that the poor are also hard workers [11] despite disliking the welfare system and personal responsibility. Individuals are therefore considered to be able to succeed with the application of skills and work as well as motivation and perseverance [12,13].
Adolescents’ cognitive, behavioral, emotional, and physical development are all negatively impacted by adversity. Thus, coping with economic pressure necessitates adaptability and resiliency. It is the job of human service professionals such as social workers, community organizers, and policy practitioners to increase the economic resilience of individuals. Social workers have the most contact with individuals and families living under economic pressure. Social workers and others in human services are responsible for enhancing these persons’ strengths while remaining attentive to the damaging impact that economic pressure may have on even the most resilient individuals.
The view is that poverty is due to a cultural belief system passed down from generation to generation and maintained by individuals even if they are victims of their dysfunctional sub-culture or culture [14]. This theory is rooted in the cultural theory of poverty [15], which assumes that the poor and the rich have patterns of values, norms, and beliefs passed down from generation to generation. Despite this, poor people can fight their way-out poverty [16]. Other critics assume that human capital is the main factor in increasing income, so a shortage causes a person to become poor [17,18].
Another view states that poverty occurs due to geographical factors [7], the existence of rural, urban, and third-world poverty, and others [12]. In addition, there is also sudden poverty due to natural disasters and the like, also known as the poverty cycle theory [19]. It is further explained that an economic downturn causes consumption, savings, and government revenue from taxes to decline [12]. However, the solution can be done by migrating out of the area or developing the area so that it is connected to other better areas [12].
Although the view that poverty is due to the fault of the individual (internal) or culture or due to external factors such as geography, or other factors, will ultimately affect their behavior that causes poverty to increase. The problem is that empirical research is needed to prove the relationship between a culture that causes changes in behavior and its impact on poverty.
The search results through the publish or perish application indexed by Scopus with the keyword “absolute poverty” in the range of 2010–2022 showed that there were 90 articles that appeared. After searching through the titles and abstracts, there were only 37 articles that were relevant to poverty. All articles that discuss absolute poverty only discuss its relationship with growth, measurement indicators, the state of absolute poverty in a country, and finance [20,21,22,23,24]. None of the articles that discuss poverty are related to changes in the behavior of the poor. Therefore, this study explores the causes of poverty within low-income families. We depart from the view that poverty occurs because of the hereditary culture of the low-income family [25,26], which ignores the origin of this culture which may be external to them.
The behavior of the family culture is what we consider to be the main cause of poverty, especially absolute poverty. To support this research, we want to portray this problem by relying on Kurt Lewin’s [27,28] view of change, where in the process of change, at least pay attention to two things, namely internal factors (obstacles from within) and external factors (encouragement from outside themselves). Furthermore, it is said that something will change if it can reduce obstacles from within and coupled with encouragement from outside. In line with this, to develop human resources, researchers rely on human capital theory, in which everyone has an intangible asset. If these intangible assets can be developed, they will improve performance or productivity [29,30].
This study is a cross-sectional examination of the relationship between the concepts of economic pressure and resilience among people living in poverty. Using a critical strengths-based approach, we propose that economic pressure erodes individuals’ resilience and strengths. The economic constraints faced by individuals with very low incomes were of special interest to this study, as was the chance to find ways in which service provision to these individuals and others in similar circumstances may be improved. The findings have implications for behavior, policy, education, and research aimed at strengthening the resilience and strengths of impoverished individuals.
This research is expected to provide another perspective from previous studies on poverty; these findings are expected to fill the void of study space from the perspective of the poor. In addition, this research also adds to the shortcomings of poverty studies that are still dominated by secondary data. The most important thing is the need to prove the relationship between behavior and poverty, especially in Indonesia.

2. Literature Review

Theoretical Background and Hypothesis Development

Research on poverty, especially absolute poverty, over the last ten years has become an object of intense interest, as evidenced by the number of studies related to this theme. Starting from absolute poverty measures, for example, absolute poverty by reviewing the measurement of five livelihood capitals, namely natural, physical, human, social, and financial, conducted on 280 million poor people in the Indo-Gangetic plains of India found that the five livelihood capitals were the best measure of absolute poverty [31]. Using absolute poverty as a measure of taxation for wealthy families is expected to eliminate taxation distortions for citizens [32].
Furthermore [2] argued that the measurement model of poverty indicators must be adjusted every year because it was proven that the model used with 2005 data and then tested on 2007 data made the amount of poverty inconsistent. However, after trying the indicators in 2007, it was found to be more accurate than before. In addition, the findings [33] that poverty is a multidimensional phenomenon that a set of indicators can measure as a component of poverty consisting of three main components, namely absolute poverty, relative poverty, and income, but there is a controversy over the measurement in the European Union.
Other studies have found an increase in relative poverty due to a decrease in absolute poverty; for example, the finding [34] found that relative poverty increased slightly between 2003–2004 and 2011–2012, both before and after the housing costs. However, it has declined since the financial crisis, and there has been a marked decrease in absolute poverty, as well as in China [35]. Meanwhile, absolute poverty can be reduced by various policies, such as financial and income sector policies [36,37,38,39,40], fiscal and social security policies [41], tourism sector improvement [42,43,44], equality and economic growth [45], geo-information contribution to poverty improvement in China [35].
None of these studies looked at poverty from the internal factors of the poor. Therefore, the two theories that form the basis of this research, namely the Lewin Model [27,28] and Human Capital Theory [46] as well as inspiration from the cultural view of poverty [47] are also the development of research results in South Sulawesi. These important findings include the perception and behavior patterns of low-income family members in South Sulawesi, such as short-term vision, uncontrolled consumption, quality friendship, and religious-based family management [7]. The perception pattern of short-term vision and uncontrolled consumption behavior as a community habit is suspected to be one of the causes of poverty. At the same time, religious-based family management and friendship quality encourage the resilience of the poor in South Sulawesi [7].
Apart from low income [48], low-income families also have a very short-term view of the future [49]. This short-term vision is characterized by the higher the income, the more they want to buy [50], and what they think about today’s needs. In general, low-income families work hard to get rewards. However, they immediately spend their money [51] without thinking about tomorrow because their thoughts are short-term, so there are no savings and without good financial management. This situation will increase uncontrolled consumption and exacerbate poverty [52].
Uncontrolled consumption is a pattern of consumption behavior carried out by low-income families in their daily lives without restrictions from the person in charge of the family (their parents). In addition to low income [53], they spend their money on wants rather than needs. For example, children from these low-income families freely spend their money on whatever they want without any direction from their parents. Apart from spending freely, they also need to plan the allocation of their income. What is even interesting is that there is a feeling of prestige and shame if their children cry because they want something, if necessary, go into debt if their children do not cry as well as because of the large number of family dependents [54].
The short-term vision of low-income families can encourage the next behavior, namely the tendency to spend all their income without planning; even though income is limited, they still consume based on prestige [34], focus on current needs, to fulfill desires, borrowing is no problem. These patterns of behavior and lifestyles that we call uncontrolled consumption can encourage an increase and change in the consumption behavior of poor households [7], Short-term vision can encourage greater spending, one of which is due to the psychological factor of money [55,56] than family income contributes to uncontrolled consumption so that the result is that it is difficult for the family to get out of absolute poverty. Based on this, several hypotheses can be made as follows:
H1. 
Short-term vision has a significant positive effect on uncontrolled consumption.
H2. 
Uncontrolled consumption has a significant positive effect on absolute poverty.
H3. 
Short-term vision has a significant positive effect on absolute poverty.
H4. 
Short-term vision has a significant positive effect on absolute poverty through uncontrolled consumption.

3. Methods

3.1. Sample and Data Collection

This research was conducted using a quantitative approach. In order to achieve the objectives of this study, the data were analyzed using SEM-Amos [57,58,59] version 23. The research population was low-income families in South Sulawesi, especially in six districts: Makassar, Jeneponto, Selayar Islands, Bone, North Luwu, and North Toraja. Sampling was conducted using random sampling [58], which selected low-income families who wanted to fill out an online questionnaire with a minimum sampling goal of 100 people. Because the SEM-Amos approach will be more appropriate for 100–200 respondents [59], only completed questionnaires were included in the data analysis. At the agreed time of seven weeks, only 201 households participated in the survey. The complete sample data can be seen in the following Table 2.
The COVID-19 pandemic has been challenging, making it difficult for this research to collect the necessary data. It was only because of the volunteerism of the field officers we recruited from the research locations who understood the local language and had experience assisting low-income families. Because low-income families generally have a low level of education, they needed assistance filling out the questionnaire forms we prepared. We guided the assistants in helping the low-income families fill in the questionnaires so that, with their help, this research could be conducted. We sent the questionnaire forms to the field staff. Then they assisted the low-income families in filling out the questionnaires (reading and translating for those who needed it) but ensured that each head of the household became a respondent in this study. Although in the end, we only received data from 201 respondents that were suitable for analysis.

3.2. Varibles Measurment

Short-term vision [60] is measured by five indicators, namely the mind of spending money, today’s mind alone, without thinking about saving money, without thinking about financial management, and Limitations of financial management capability. Five indicators measure uncontrolled consumption [60]: unplanned consumption, desire-based consumption, prestige-based consumption, current-focus consumption, and consumption that exceeds income. Absolute poverty is measured by eleven indicators, namely limited food adequacy and quality; limited access and low quality of health services; limited access and low quality of education services; limited employment and business opportunities; limited access to health and sanitation services; limited access to clean water; uncertainty about land ownership and control; deteriorating conditions of the environment and natural resources; weak security guarantees; weak participation; and the size of the population burden [58]. The complete measurement of variables and questionnaire statement items can be seen in Table 3 below:

4. Result

The first stage of data processing results is shown by the confirmatory factor analysis (CFA) test, which can be seen in Table 3. However, before the CFA test is carried out, a model test is first carried out for each variable. In the short-term vision (SV) and uncontrolled consumption (UC) variables, it is found that all indicators can measure both variables; this is evidenced by the loading factor value ≥0.50. Furthermore, the absolute poverty (AP) variable has two indicators, AP1 & AP11, which have a loading factor of less than 0.50, so they are excluded from the model.
The results of this study show that five indicators, namely the mind of spending money; today’s mind alone; without thinking about saving money; without thinking about financial management; and limitations of financial management capability, are measures of short-term vision variables. Meanwhile, uncontrolled consumption can be measured by four indicators: unplanned consumption; desire-based consumption; prestige-based consumption; and consumption exceeds income, while current focus consumption cannot be used as an appropriate indicator. Furthermore, absolute poverty can only be measured with nine indicators. Thus, these three variables can be continued to the next analysis.
From the CFA test results shown in Table 4, in short-term vision (SV), all indicators have a loading factor value greater than 0.5 (α > 0.5), which means that each indicator used to measure SV in this study has a valid value. The largest measurement is shown by SV4 (without thinking about financial management) with α = 0.804, followed by SV2 (today’s mind alone) and SV3 (without thinking about saving money) with α = 0.765, SV5 (limitations of financial management capability) with α = 0.751, and SV1 (the mind of spending money) with the smallest measurement of α = 0.693. In the reliability test, the value of CR = 0.87 and AVE = 0.57 indicates that reliable indicators measure short-term vision.
In the measurement of uncontrolled consumption (UC), current focus consumption (UC4) has a loading factor of less than 0.5, so it is excluded from the final model [57,61,62]. UC1 (unplanned consumption) is the indicator that contributes the largest measurement with α = 0.813. Next is UC5 (consumption exceeds income) with α = 0.806, UC2 (desire-based consumption) with α = 0.711, and UC3 (prestige-based consumption) has the smallest measurement of α = 0.698. The value of CR = 0.84 and AVE = 0.57 in this variable also shows that the data used to measure is reliable data.
Nine indicators of α> 0.5 can only measure absolute poverty (AP) as an endogenous variable in this study. Limited adequacy and quality of food (AP1) and the size of the population burden (AP11) must be discarded from the model because each has a loading factor of less than 0.5 [57,61,62]. From the AMOS output in Table 2, AP6 (limited access to clean water) is the indicator that provides the largest measurement with α = 0.838. Next is AP3 (limited access and low quality of education) with α = 0.832; AP5 (limited access to health and sanitation services) α = 0.789; AP8 (deteriorating conditions of the environment and natural resources) α = 0.782; AP4 (limited employment and business opportunities) α = 0.777; AP9 (weak guarantee of security) α = 0. 773; AP7 (weak certainty of land ownership and control) α = 0.772; AP10 (weak participation) α = 0.760; and AP2 (limited access and low quality of health services) with α = 0.743. AP is the variable that has the highest construct reliability value (CR = 0.93, AVE = 0.61). This value indicates that highly reliable data measure AP.
In addition to knowing the validity and reliability of constructs, CFA also measures the correlation between constructs with discriminant validity values. Discriminant validity measures how far a construct differs from other constructs [57]. The test compares the square root value of variance extracted (√AVE) with the correlation value between constructs shown by AMOS output. The results of this test are shown in Table 5.
Table 5 shows that each variable’s AVE square root value is higher than the correlation between constructs. This shows that the data used in this study are unique and can capture the measured phenomena. The next testing stage is to measure the model’s suitability using the goodness of fit value from the AMOS output. The results are shown in Table 6.
Table 6 shows that the final model in this test follows the initial model conceptualized in this study. This is indicated by the CMIN/DF = 2.247; TLI = 0.917; CFI = 0.928; and RMSEA = 0.079. Although the chi-square, significance, GFI, and AGFI values are in the marginal range, overall, it can be concluded that the final model has met the suitability.
Figure 1 shows the analysis results that resulted in the final model of the concept built in this study.

Hipotesis Testing

The results of hypothesis testing can be seen in Table 7.
Table 7 shows that all hypotheses in this study can be accepted. There is a positive and significant effect of short-term vision on uncontrolled consumption (β = 0.620; p-value < 0.05); thus, H1 is accepted. Similarly, the effect of uncontrolled consumption on absolute poverty shows positive and significant results (λ = 0.489; p-value < 0.05), so H2 is also accepted. The test results also show a positive and significant direct effect of short-term vision on absolute poverty (β = 0.357; p-value < 0.05), so H3 is accepted. The indirect test also confirmed that indirectly, the effect of short-term vision on absolute poverty through uncontrolled consumption is 0.303. Using the Sobel test, it can be seen that the Sobel statistic value = 3.584 (>1.967) and two-tailed probability = 0.003, which means that partially uncontrolled consumption can mediate the effect of short-term vision on absolute poverty (H4 is accepted).

5. Discussion

The results of this study show that compared to short-term vision, uncontrolled consumption is an antecedent that has a greater influence on the increase in absolute poverty. This means absolute poverty will increase if people cannot control their consumption. An interesting point is shown in the measurement of uncontrolled consumption, where unplanned consumption is the indicator with the largest loading factor. This means that uncontrolled consumption can be seen from the tendency of people to buy goods without prior planning. Another thing is that they consume goods or services that are desired rather than needed, which are able to increase their prestige [63,64], even though these goods are not basic needs that must be met immediately. This consumption type is influenced by psychological factors [65]. People will feel satisfied if they can buy items that make them proud and get recognition from others.
Notwithstanding these obstacles, individuals revealed specific strengths that may be utilized to enhance their social well-being. They tended to view themselves as “independent, goal-oriented, living modestly, and capable of achieving their objectives.” This study found that “when I create plans, I feel confident in my ability to execute them” was the least resilient characteristic. A strengths-based practice should consider that individuals living in poverty possess a certain level of resilience. For a relationship to be successful, however, one must believe these folks have some degree of efficacy. Even while our relationship is formal, it should not be organized in a way that hampers their growth or well-being. The participant believed that although they expected to be handled according to the National Association of Social Work Code of Ethics, the relationship was analogous to that of an attorney and client.
Based on the results of data analysis, this study shows that the inability to have clean water facilities in the house is the clearest picture of poverty in the community. This research is in line with several previous studies which also found that poverty in a country can be seen from the availability of clean water to its population [66]. Through the results of this study, we also support the research, which states that there is a complex relationship between access to clean water and poverty in an area. This result also clearly illustrates that we are facing a very important issue regarding poverty, namely energy poverty. We believe that a healthy nation comes from a healthy family. This, of course, must be supported by the availability of clean water in each household.
Personnel of human service agencies should be aware of the reality affecting individuals and families living in poverty and the sociopolitical roles that the agencies and systems represent. For most individuals, employment and job training are not the only solutions. I’d been a worker my entire life and worked hard throughout my life. It is essential to take a holistic approach to human needs if these families are to maintain their strengths. Human service providers should also be concerned with how policies include client strengths and how states are restructuring their welfare systems to capitalize on family strengths and collaborate with families and community organizations.
In its function as an antecedent that directly or indirectly affects absolute poverty, a short-term vision has a relatively small role in increasing absolute poverty. However, the measurement results in the model show that the effect of short-term vision on uncontrolled consumption is the largest compared to all the relationships conceptualized in this study. This result shows that a short-term mindset strongly influences people’s uncontrolled consumption in fulfilling their needs. Good financial management is necessary to manage their consumption properly, both for the present and future. This must be a concern considering that the main needs must be fulfilled. The results of this study can also be interpreted that the current level of community income has yet to meet their main needs. This research also supports the statement [64] that income levels strongly influence absolute poverty.
What is interesting about this research is that low-income families with low incomes should manage their family finances well so that they can organize the allocation of income well to anticipate the absence of income at a certain time, but this still needs to be done. Their attitudes and short-term thinking encourage uncontrolled consumption behavior that ultimately increases poverty (exacerbates poverty). Apart from not thinking about a good tomorrow, they also allow their children to consume goods that are not based on needs but on what they want. This behavior makes it difficult for them to get out of absolute poverty. The attitudes and behaviors that develop in low-income families, if they cannot be overcome, absolute poverty is difficult to eliminate even with the various government programs implemented.
This finding also reveals a view of culture that can contribute to poverty, especially absolute poverty [67,68,69]. At least it provides an avenue for further research into the relationship between culture–attitudes, and behaviors–absolute poverty.
The results of this study indicate an interaction between individual behavior and poverty, which is in line with Kurt Lewin’s model of change, which emphasizes the importance of individual behavior in creating change. The study shows uncontrolled consumption, influenced by psychological factors, is a significant antecedent of absolute poverty. This follows the theory of human capital, which states that individuals with good financial management skills and the ability to plan are more likely to avoid poverty. In addition, this study highlights the importance of clean water facilities in reducing poverty, which aligns with the notion that human capital, such as access to basic needs and resources, is an important component in poverty alleviation. It is, therefore, important to consider both individual behavior and access to resources in developing an effective poverty reduction strategy.

5.1. Theoritical Implication

The findings of this study corroborate the view of the Lewin Model [27,28] that factors from within low-income families (attitudes and behaviors) pose a challenge to poverty alleviation, making it difficult to achieve. These results support the assertion that an important part of economic and financial theory assumes that individuals tend to make financial decisions as “homo economicus” [70]. As economic beings, humans always want to fulfill their needs rationally to survive. Like Abraham Maslow’s theory of needs [71] depicted in the pyramid, physiological needs (food, clothing, shelter) are basic needs that must be met first compared to other needs. Those who bypass the basic layer and move on to fulfill other needs will be more prone to irresponsible consumption and poor financial performance. Furthermore, the attitudes and behaviors of low-income families are intangible assets that, if not managed properly, will be counterproductive, which is a reinforcement of the Human Capital Theory [72,73].
In this study, participants recognized impediments to “making plans work,” a feature that often necessitates knowledge and external resources. For instance, those who wish to attend college may need to know which college to attend, which courses to take, the cost, and other pertinent information. They may be unaware of financial assistance programs, scholarships, and other financing sources. In that case, they may assume that even if they intend to attend college, they cannot afford it. Here is another chance for human service workers to advocate for their clients and connect them with the most suitable sources and services. This may be crucial for the first in their generation to attend college.

5.2. Practical Implication

This research can contribute to poverty alleviation by providing a reminder that the internal factors of the poor should be taken into account in addition to external factors with the various government programs that exist today so that poverty alleviation can be successful. This finding provides another perspective from previous findings that only consider the external causes of poverty. The attitude they have (short-term vision) will have an impact on their behavior (uncontrolled consumption) in consuming. Their behaviors will push them into deeper poverty, so it is necessary to encourage the application of financial management that can be started from a small scale, for example, within the scope of the household. Although the application will be challenging considering the low income of the community when compared to the needs, with good financial management, the community can classify their consumption behavior based on the level of needs.
Individuals from various economic origins may be financially capable in one area but not another. For instance, persons living in poverty may be more adept at making ends meet than selecting the greatest things. In contrast, some individuals may better plan and select the best things than monitor their spending. Hence, human service personnel should evaluate the strengths and weaknesses of the individuals they serve and concentrate more on the susceptible components of a person’s financial competence. Nonetheless, interventions should consider the client’s talents and objectives and not impose undue demands on these folks. For instance, relevant financial education classes should be offered without paternalism at convenient times and locations.

5.3. Study Limitations

The sample size and parameters of the study do not permit additional explorations of possible factor structure variations based on significant variables. Further studies with a more diverse and larger sample, which may provide a split sample or multiple group comparisons depending on critical characteristics, will enhance the findings. Qualitative studies are essential because they enable research participants to express their perspectives on economic pressures and personal resilience. We further urge that, as a result of the recent economic downturn, middle-income individuals are included in such studies to determine how they display efficacy and cope with the economic difficulties caused by recent income losses. Also, given the sample for this study comprised individuals who self-identified as “household heads,” generalizing the findings to families or homes is a limited endeavor and should not be confused.
Resilience depends not just on personal qualities and strengths but also on social support. For instance, means-based welfare programs, friends, family members, and numerous informal networks can strengthen an individual’s resilience. This could include institutional and informal support sources for families experiencing economic difficulties. Also, one may feel more robust than another in a certain setting. For example, one may feel more resilient at work than at home. Research that controls for these components of resilience should aid academics and human service professionals in enhancing the resilience of individuals and families under economic stress.

6. Conclusions

This research answers the role of family behavior (uncontrolled consumption) in creating absolute poverty. It is empirically proven that uncontrolled consumption can push families into the deepest poverty. This behavior will contribute more to increasing absolute poverty if the family has a short-term vision attitude. Research proves that a family’s ability to overcome obstacles, such as buying goods without planning or because of the prestige of the surrounding environment rather than personal needs, will determine the extent to which this family plays a role in encouraging poverty reduction. If these obstacles can be overcome, the poverty rate in a region can be reduced. Therefore, overcoming negative attitudes and behaviors (short-term vision and uncontrolled consumption) as a form of application of the Kurt Lewin model and human capital theory can reduce absolute poverty and vice versa. The next important issue to study is the concept that can inhibit or reduce barriers within low-income families, which are within low-income families in Indonesia.
This research examines the role of family behavior in creating absolute poverty in Indonesia. It has been empirically proven that uncontrolled consumption behavior, including unplanned consumption, desire-based consumption, prestige-based consumption, current focus consumption, and consumption exceeding income, can push families into deeper poverty. This behavior will contribute more to an increase in absolute poverty if the family has a short-term outlook.
This research shows that the ability of a family to overcome obstacles, such as buying goods without planning or for prestige in the environment rather than personal needs, will determine the extent to which this family plays a role in driving poverty alleviation. If these obstacles can be overcome, then the poverty level in Indonesia can be reduced.
The results of this study provide important insights for the Indonesian government to overcome negative attitudes and behaviors that can hinder absolute poverty alleviation. In addition, this research can also inspire similar research in other countries, including Australia. For example, research [74] shows that housing costs, income growth, and unemployment rates have played an important role in poverty in Australia since the financial crisis. Therefore, further studies may consider these factors in the context of other countries to develop more effective poverty alleviation strategies.

Author Contributions

Methodology, H.T.; Writing—original draft, H.T.; Validation, G.B.I. and J.N.; Investigation, Y.Y.; Writing—review & editing, Y.Y.; Visualization, Y.Y. All authors have read and agreed to the published version of the manuscript.

Funding

This research was funded by the Ministry of Education, Culture, Research and Technology of the Republic of Indonesia.

Institutional Review Board Statement

The study was conducted in accordance with the Declaration of Helsinki, and approved by the Institutional Review Board (or Ethics Committee) of Sekolah Tinggi Ilmu Ekonomi AMKOP (protocol code 254 and 23 May 2022).

Acknowledgments

Finally: this research can be completed; therefore, we, the research team, would like to thank the Ministry of Education, Culture and Research for funding this research, and our institution, Sekolah Tinggi Ilmu Ekonomi AMKOP, for its support during the research. Last but not least, we would like to thank all respondents (low-income families in South Sulawesi) who are willing to participate in this research.

Conflicts of Interest

The authors declare no conflict of interest. The funders had no role in the study’s design; in the collection, analyses, or interpretation of data; in the writing of the manuscript; or in the decision to publish the results.

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Sustainability 15 06894 g001 550
Figure 1. Structural Equation Model.
Figure 1. Structural Equation Model.
Sustainability 15 06894 g001
Table
Table 2. Respondents Demography.
Table 2. Respondents Demography.
Demographic ItemsFreq.%Demographic ItemsFreq.%
Age Family Income
1. Range 20–303919.4%1. More than IDR 150,000 daily21.0%
2. Range 31–405527.4%2. IDR 101,000–IDR 150,000 daily94.5%
3. Range 41–5010753.2%3.IDR 51,000–IDR 100, 000 daily4723.4%
Amount201100.0%4. IDR 20, 000–IDR 50,000 daily7537.3%
Education 5. Less than IDR 20,000 daily6833.8%
1. Bachelor52.5%Amount201100.0%
2. High school graduate2813.9%Number of Family Members
3. Junior high school graduate3115.4%1. More than nine people00.0%
4. Elementary school graduate5326.4%2. 7–9 persons199.5%
5. Not graduated from elementary school3617.9%3. 4–6 persons10351.2%
6. Never went to school4823.9%4. 1–3 persons7939.3%
Amount201100.0%Amount201100.0%
Regional origin
1. Makassar8743.3%
2. Jeneponto2512.4%
3. Selayar2010.0%
4. Bone2411.9%
5. North Luwu2311.4%
6. North Toraja2210.9%
Amount201100.0%
Table
Table 3. Measurement of variable.
Table 3. Measurement of variable.
ConstructIndicatorItem
Short-term
Vision		The mind of spending money
▪
If we have money, there are many things we want to buy
Today’s mind alone
▪
We are only thinking how to meet today’s needs
Without thinking about saving money
▪
Our income today, we spend it all today, for tomorrow we will try again tomorrow
Without thinking financial management
▪
We have no idea how to arrange the allocation (daily needs, urgent needs, and savings) of our income
Limitations of financial management capability
▪
We don’t have the ability to manage our finances (income)
Uncontrolled
Consumption		Unplanned consumption
▪
We don’t have a shopping plan, just buy it according to our income today
Desire-based consumption
▪
We do not regulate, only follow the wishes of children or family members who want to buy
Prestige-based consumption
▪
If we have money, we also buy something valuable like a television or cellphone because we are embarrassed if we don’t have it
Current focus consumption
▪
We really focus on consuming according to what you need today, for tomorrow, let’s try again tomorrow
Consumption exceeds income
▪
Sometimes if we want to eat something, let us borrow it first and then we will get the money and then we get paid
Absolute
Poverty		Limited adequacy and quality of food
▪
We do not have enough to meet our daily needs for food and drink and shelter
Limited access and low quality of health services
▪
We can’t afford to go to the public health center when we are sick because of limited money and don’t know how to do it
Limited access and low quality of education services
▪
We can’t send our children to the same level as others to high school
Limited employment and business opportunities
▪
We have so many limitations that we can’t get a decent job like everyone wants
Limited access to health and sanitation services
▪
We have limitations so we don’t have proper housing and sanitation
Limited access to clean water
▪
Everything is so limited that you can’t afford to buy clean water or enter PAM water into your house
Weak certainty of land ownership and control
▪
We don’t have land so we can only ride or rent a place to live
Deteriorating conditions of the environment and natural resources
▪
We are not able to protect the environment and natural resources around us
Weak guarantee of security
▪
Every time we feel anxious because the house is leaking, we don’t have ASKES, we don’t have savings, and so on
Weak participation
▪
We cannot participate optimally in every government policy such as being involved in development
The size of the population burden
▪
We have a large family with many family members
Table
Table 4. Confirmatory Factor Analysis.
Table 4. Confirmatory Factor Analysis.
ConstructItemItem DescriptionαS.ECritical Ratiop-ValueConvergent Validity (AVE) ≥ 0.50Construct Reliability (CR) ≥ 0.70
Short Term VisionSV1The mind of Spending Money0.6930.1109.718***0.570.87
SV2Today’s mind alone0.765Reference point
SV3Without thinking about saving money0.7650.10510.834***
SV4Without thinking financial management0.8040.10911.420***
SV5Limitations of financial management capability0.7510.10310.614***
Uncontrolled ConsumptionUC1Unplanned consumption0.813Reference point0.570.84
UC2Desire-based consumption0.7110.08410.357***
UC3Prestige-based consumption0.6980.08210.148***
UC4Current focus consumption-Deleted item
UC5Consumption exceeds income0.8060.08211.973***
Absolute PovertyAP1Limited adequacy and quality of food-Deleted item0.610.93
AP2Limited access and low quality of health services0.7430.07012.160***
AP3Limited access and low quality of education services0.832Reference point
AP4Limited employment and business opportunities0.7770.06612.983***
AP5Limited access to health and sanitation services0.7890.06213.262***
AP6Limited access to clean water0.8380.06614.561***
AP7Weak certainty of land ownership and control0.7720.07212.845***
AP8Deteriorating conditions of the environment and natural resources0.7820.07213.101***
AP9Weak guarantee of security0.7730.07012.876***
AP10Weak participation0.7600.06812.562***
AP11The size of the population burden-Deleted item
Note: α = loading factor dari setiap indicator; S.E = standard error; *** = significance< 0.01.
Table
Table 5. Discriminant validity.
Table 5. Discriminant validity.
SVUCAP
SV0.756
UC0.6200.757
AP0.6610.7110.785
Note: the number on the diagonal is the square root value of AVE.
Table
Table 6. Goodness of fit.
Table 6. Goodness of fit.
MeasurmentCut of ValueResultRemark
Chi-Square df = 132 .   X 2 = 159.813290.568Marginal
Significance≥ 0.050.000Marginal
CMIN/DF≤ 32.247Fit
GFI≥0.900.859Marginal
AGFI≥0.900.817Marginal
TLI≥0.900.917Fit
CFI≥0.900.928Fit
RMSEA0.03–0.080.079Fit
Table
Table 7. Hypotesis testing.
Table 7. Hypotesis testing.
HypothesisStd. EstimateEstimateS.EC.Rp-ValueResult
H1: Short-term Vision → Uncontrolled Consumption0.6200.6540.0956.891***Accepted
H2: Uncontrolled Consumption → Absolute Poverty0.4890.6310.1145.539***Accepted
H3: Short-term Vision → Absolute Poverty0.3570.4870.1114.376***Accepted
H4: Short-term Vision → Uncontrolled Consumption→ Absolute Poverty0.303Sobel statistic: 3.5840.003Accepted
Notes: S.E = standard error; C.R = critical ratio (C.R value should be greater than 2); *** = significant < 0.01.
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Tamsah, H.; Ilyas, G.B.; Nurung, J.; Yusriadi, Y. Model Testing and Contribution of Antecedent Variable to Absolute Poverty: Low Income Family Perspective in Indonesia. Sustainability 2023, 15, 6894. https://doi.org/10.3390/su15086894

AMA Style

Tamsah H, Ilyas GB, Nurung J, Yusriadi Y. Model Testing and Contribution of Antecedent Variable to Absolute Poverty: Low Income Family Perspective in Indonesia. Sustainability. 2023; 15(8):6894. https://doi.org/10.3390/su15086894

Chicago/Turabian Style

Tamsah, Hasmin, Gunawan Bata Ilyas, Jumiaty Nurung, and Yusriadi Yusriadi. 2023. "Model Testing and Contribution of Antecedent Variable to Absolute Poverty: Low Income Family Perspective in Indonesia" Sustainability 15, no. 8: 6894. https://doi.org/10.3390/su15086894

APA Style

Tamsah, H., Ilyas, G. B., Nurung, J., & Yusriadi, Y. (2023). Model Testing and Contribution of Antecedent Variable to Absolute Poverty: Low Income Family Perspective in Indonesia. Sustainability, 15(8), 6894. https://doi.org/10.3390/su15086894

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