Infrastructure expansion and its environmental impact on micro-business profitability and sustainability

This study investigates the impact of toll road construction on 59 micro, small, and medium enterprises in Kampar, Pekanbaru, and Dumai cities. The research aims to analyze the economic and environmental effects of infrastructure expansion on businesses’ profitability and sustainability, providing insights for policymakers and stakeholders to develop mitigation strategies to support MSMEs amidst ongoing infrastructure development. Structural equation modeling, spatial environmental impact analysis, and qualitative data analysis using five-level qualitative data analysis (FL-QDA) were all used together in a mixed-methods approach. Data collection involved observations, interviews, questionnaires, and geospatial analysis, including the use of a Geo-Information System (GIS) supported by drone reconnaissance to map affected areas. The study revealed that the toll roads significantly enhanced connectivity and economic growth but also negatively impacted local economies (β = 0.32, R2 = 0.60, P-value ≤ 0.05). and the environment (β = 0.34, P-value ≤ 0.05), as 49% of respondents experienced a 50% decrease in profitability. To mitigate the risk of impact, policymakers should prioritize the principle of prudence to evaluate the significance of mitigation policy implementation (β = 0.144, P-value ≥ 0.05). In a nutshell, toll road construction significantly impacts MSMEs’ business continuity, necessitating an innovative strategy involving monitoring and participatory approaches to mitigate risk.

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Publication Details

Journal
Journal of Infrastructure Policy and Development
Published
2024-09-20
DOI
https://doi.org/10.24294/jipd.v8i10.6641
Primary Topic
Urban and Rural Development Challenges
Type
article
Field-Weighted Citation Impact
0.00

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article

Infrastructure expansion and its environmental impact on micro-business profitability and sustainability

Krisna Sudjana, Ahmad Subagyo, Heffi Christya Rahayu, Faizul Mubarok et al.
Journal of Infrastructure Policy and Development
Urban and Rural Development Challenges
article

Infrastructure expansion and its environmental impact on micro-business profitability and sustainability

Krisna Sudjana, Ahmad Subagyo, Heffi Christya Rahayu, Faizul Mubarok, Saif Ur Rahman, Martino Wibowo
article en

Abstract

This study investigates the impact of toll road construction on 59 micro, small, and medium enterprises in Kampar, Pekanbaru, and Dumai cities. The research aims to analyze the economic and environmental effects of infrastructure expansion on businesses’ profitability and sustainability, providing insights for policymakers and stakeholders to develop mitigation strategies to support MSMEs amidst ongoing infrastructure development. Structural equation modeling, spatial environmental impact analysis, and qualitative data analysis using five-level qualitative data analysis (FL-QDA) were all used together in a mixed-methods approach. Data collection involved observations, interviews, questionnaires, and geospatial analysis, including the use of a Geo-Information System (GIS) supported by drone reconnaissance to map affected areas. The study revealed that the toll roads significantly enhanced connectivity and economic growth but also negatively impacted local economies (β = 0.32, R2 = 0.60, P-value ≤ 0.05). and the environment (β = 0.34, P-value ≤ 0.05), as 49% of respondents experienced a 50% decrease in profitability. To mitigate the risk of impact, policymakers should prioritize the principle of prudence to evaluate the significance of mitigation policy implementation (β = 0.144, P-value ≥ 0.05). In a nutshell, toll road construction significantly impacts MSMEs’ business continuity, necessitating an innovative strategy involving monitoring and participatory approaches to mitigate risk.

Journal of Infrastructure Policy and DevelopmentVol. 8(10)
School of Business and Management (FR), Indonesia Open University (ID), Institut Manajemen Koperasi Indonesia (ID), Office of International Affairs (US), Universitas Pasir Pangaraian (ID)
Kementerian Pendidikan, Kebudayaan, Riset, dan Teknologi, Direktorat Jenderal Pendidikan Tinggi
Openalex Percentile: Top 75%
Urban and Rural Development Challenges
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