Regional Spillover Effect On Economic Growth: A Case Study Of Surabaya And Madura Island

Abstract

This study aims to investigate the Spillover Effect Economic Activity Against Surabaya Madura region. The approach used in this study is a quantitative approach using panel data. The data was taken from regional data covering the City of Surabaya, Bangkalan Regency, Sampang Regency, Pamekasan Regency, and Sumenep Regency with a time series from 1999 - 2018. Then this study uses analysis Granger causality which aims to analyse the causal relationship between the economic activities of an area. with other areas. The results of data analysis using the test Granger causality and empirical comparison of the spillover effect of the economy of Surabaya to Madura Island show that a backwash effect occurs. Thus, it can be concluded that the Suramadu Bridge which is expected to support economic mobility and the spillover effect of the existence of the City of Surabaya as a growth center provides a spread effect to the Madura region as a peripheral that does not occur. The growth center effect in the Madura region produces a backwash effect.