Enhancing Invesment in West Java: An Analysis of Leading Sectors Using Spline Approach

Abstract

The economic growth of West Java significantly relies on the leading sectors of each region. These sectors can stimulate invesment growth in the area. Therefore, efforts are needed to maximize the leading sectors in West Java and understanding the impact of these sectors is crucial for policymakers to design strategies the promote regional development. This study aims to analyze how leading sectors enhance invesment in West Java using the Spline approach, providing insights into the specific contributions of each sector and identifyng key areas for potential growth. The research findings indicate that the coefficient of determination formed by the leading sector variables in West Java can explain 79.57% of the variation in invesment values across the regencies/cities in West Java. The model interpretation of each variable reveals that the manufacturing sector has the potential to increase invesment by IDR 899,017,396,000 in seven regencies/cities in West Java. Additionally, another interpretation shows that the distribution of potential growth is concentrated in certain areas and has not spread evenly, particularly in the Priangan Timur region. Local governments need to focus on strengthening the leading sectors through fiscal incentives and regulatory policies that support investment growth. Additionally, improving infrastructure and providing adequate facilities are necessary to strengthen stability and promote sustainable economic growth in West Java.