The Effect of Private Investment and Capital Expenditure on Economic Growth and Income Inequality in Bali Province

ABSTRACT : Income inequality is a condition that describes the difference in income between people and areas that are developed and regions that are left behind. Inequality between regions has become a major focus in policies and interests of the government and society, especially Indonesia, which is a country with a pluralistic society where geographical conditions affect economic activities in an area. This study aims: to analyze the effect of private investment, capital expenditure and economic growth on income inequality in Bali Province. The data used are secondary data from 2013-2019 with quantitative and qualitative data types, then by using an associative paradigm. The data collection method used is the non-participant observation method, the data is processed using path analysis techniques. The results showed that private investment and capital expenditure had a positive and significant effect on economic growth; Private investment, capital spending and economic growth have a negative and significant effect on income inequality; and Private investment and capital expenditure do not indirectly influence income inequality in Bali Province through economic growth as a mediating variable.
Keywords: income inequality, economic growth, private investment, capital spending