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.
Authors
- Krisna Sudjana
- Ahmad Subagyo
- Heffi Christya Rahayu (ORCID: https://orcid.org/0000-0003-2784-7749)
- Faizul Mubarok (ORCID: https://orcid.org/0000-0003-4123-6696)
- Saif Ur Rahman (ORCID: https://orcid.org/0000-0003-3080-220X)
- Martino Wibowo
Institutions
- School of Business and Management (FR)
- Indonesia Open University (ID)
- Institut Manajemen Koperasi Indonesia (ID)
- Office of International Affairs (US)
- Universitas Pasir Pangaraian (ID)
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
Funders
- Kementerian Pendidikan, Kebudayaan, Riset, dan Teknologi
- Direktorat Jenderal Pendidikan Tinggi