Journal of Economics, Finance and Management Studies ISSN (print): 2644-0490, ISSN (online): 2644-0504 Volume 6 Issue 4 April 2023 Article DOI: 10.47191/jefms/v6-i4-42, Impact Factor: 7.144 Page No. 1793-1798 JEFMS, Volume 06 Issue 04 April 2023 www.ijefm.co.in Page 1793 The Differences in Factors that Influence Poverty in Urban, Suburban, and Rural Areas Rasyid Widada 1 , Baba Barus 2 , Bambang Juanda 3 , Sri Mulatsih 4 1 Regional Development Planning and Rural Studies, IPB University, Bogor, Indonesia 2 Faculty of Agriculture, IPB University, Bogor, Indonesia 3, 4 Faculty of Economics and Management, IPB University, Bogor, Indonesia ABSTRACT: The study of poverty in Indonesia that specifically takes a review or category of suburban area has not been conducted widely. In fact, when referring to the dimensions that correlate with poverty, various problems related to access to economic resources, social facilities and services, public infrastructure, geographical constraints, and land tenure are actually more common in suburban areas than in the city center. The aims of this study are 1) to determine the spatial zoning in Kendal Regency based on the categories of urban, suburban, and rural areas. 2) identify the variables that affect suburban poverty in Kendal Regency. This study took place in Kendal Regency, which is one of the districts directly adjacent to Semarang City, the capital city of Central Java Province, Indonesia. The unit of analysis in this study is the village, totaling 286 villages. The technique used is K-Means Clustering and linear regression (OLS). The results of the analysis show that the distribution of poverty in Kendal Regency is clustered. In addition, suburban poverty has a different character than poverty in urban and rural areas. KEYWORDS: poverty, urban, suburban, rural INTRODUCTION The rapid economic growth in urban areas will definitely have spillover effects on the surrounding rural areas (Yunus, 2006). The spillover effect makes the rural areas around the city economically integrated with the city center. Economic integration with the city center will encourage land conversion in rural areas to support economic activities in urban areas (Harmadi and Yudhistira, 2008). Land in rural areas which was originally an agricultural area, animal husbandry, plantation, forest, and the like, then changed its function to become a residential and industrial area. This phenomenon is known as suburbanization emerges, which is characterized by the formation of new settlements and industrial areas on the outskirts of urban areas (Rustiadi and Panuju, 1999). The process of forming new settlements and industrial areas spreads from urban areas to suburban areas with an irregular pattern of distribution, so it is known as urban sprawl (Rustiadi et al, 2011; Soetomo, 2013). Urban sprawl has quite serious impacts, not only threatening the availability of agricultural land, but also side effects related to the conversion of agricultural land (Grant, 2010). The changes of agricultural land function will be followed by changes in the livelihood structure of suburban communities from the agricultural sector to other sectors outside agriculture. Reduced agricultural land and added economic urgency, encourage the behavior of suburban communities to seek solutions through new businesses outside the agricultural sector (Sihaloho et al, 2007). However, due to limited education and skills, people who were originally dependent on the agricultural sector tended to only be able to switch to the informal sectors which certainly did not promise better welfare. As a result of land conversion, residents have switched professions from farmers to small traders, factory workers, motorcycle taxi drivers, and/or coolies (Kamim et al, 2019: Andari et al, 2018). On the other hand, Kneebone (2017) found indications that poverty in suburban areas has continued to increase since 2000. These indications reinforce the findings of previous studies where nearly 60 percent of poverty in 100 major cities in the United States live in suburban areas (Kneebone and Williams, 2013). It is possible that the symptoms of increasing suburban poverty also apply in developing countries (Allard, 2016). Symptoms in that direction can be seen in the World Bank's (2013) study of the phenomenon of urban poverty in Vietnam. Likewise, a UNDP study (2013) in Asia Pacific found that often suburbs are the most vulnerable places for the poor where infrastructure and public services are weak or nonexistent.