The Role of the Agricultural Sector in Reducing Rural Poverty: A Case Study in Papua

Abstract

Rural poverty remains a major development challenge in Papua, Indonesia, where agriculture serves as the primary livelihood for many households but is often constrained by low productivity, limited market access, and inadequate infrastructure. This study examines how agricultural sector participation contributes to rural poverty reduction through farm productivity, market access, employment diversification, household income, and food security, while also considering the roles of infrastructure and services access and social capital as enabling factors. A quantitative cross-sectional survey was conducted involving 420 rural households in Papua. Data were analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM), supported by descriptive statistical procedures in SPSS. The results show that agricultural sector participation has significant positive effects on farm productivity, market access, and employment diversification. These factors, in turn, positively influence household income, which strengthens food security and ultimately reduces rural poverty. Infrastructure and services access were also found to improve productivity and market access while directly reducing poverty, whereas social capital significantly supports market access and employment diversification. The findings indicate that agricultural participation reduces poverty not through a single direct pathway, but through multiple interconnected mechanisms involving production, commercialization, income generation, and household welfare. This study contributes to the literature by offering a more integrated explanation of agriculture-led poverty reduction in a remote rural context. Practically, the findings suggest that poverty reduction strategies in Papua should combine agricultural development with improvements in infrastructure, market connectivity, and community-based support systems.