Identifying Unwanted Conditions through Chaotic Area Determination in the Context of Indonesia’s Economic Resilience at the City Level

Abstract

The purpose of this research is to determine the unwanted condition as a strategic criterion in measuring the economic resilience of a city. A new approach in determining economic resilience was developed to overcome the weaknesses of the index method commonly used internationally. Based on the output of this research, the development priority program for each city becomes distinctive depending on the status of the city’s economic resilience. Quality improvement programs are used for cities that do not have resilience and retention programs for cities that already have economic resilience. Five piecewise linear regression parameters are applied to identify a statistical model between Income per capita and Pc as a concern variable and modifier variable, and a Z. Model is tested massively involving all 514 cities in Indonesia from 2015 to 2019, covering the components of the modifier variable: local revenue (PAD), poverty, unemployment and concern variable; GRDP and population. The value of the Fraction of variance unexplained (FVU) of the model is 40%. This value is obtained using the Rosenbrock Pattern Search estimation method with a maximum number of iterations of 200 and a convergence criterion of 0.0001. The FVU area is a condition of uncertainty and unpredictability, so that people will avoid this area. This condition is chaotic and declared as an unwanted condition. The chaotic area is located in the value of UZ less than IDR 5,097,592 and Pc < Pc (UZ) = 27,816,310.68, and thus the coordinates of the chaotic boundary area is (5,097,592: 27,816,310.68). FVU as a chaotic area is used as the basis for stating whether or not a city falls into unwanted conditions. A city is claimed not to be economically resilient if the modifier variable Z is in a chaotic boundary.