Analysis of The Relationship of Economic Factors and The Case of COVID-19 in The Provinces in Indonesia using Principal Component Analysis and Factor Analysis
Kurnia Novita Sari, Udjianna S. Pasaribu, and Ainun Maharani Tatiana Talaohu

Faculty of Mathematics and Natural Science, Institut Teknologi Bandung, Indonesia

Abstract

COVID-19 has attacked all countries of the world including Indonesia since the beginning of 2019. This pandemic attacks public health and has a direct impact on the economic activities of the community and government. Regional income and worker wages are one of the economic factors most affected by COVID-19. Regional income and workers^ wages are divided into several variables based on the Indonesian Central Statistics Agency. Several regulations have been made by the government to contain the spread of COVID-19 cases. The implementation of Community Activity Restrictions (PPKM) is carried out in stages and can anticipate an increase in positive cases. In early 2021, a spike in positive cases occurred again and it was rumored to be a potential second wave in several provinces. The effect of the surge in positive cases and their impact on the economy is modeled based on data in semester 2 of 2020 and semester 1 of 2021. COVID-19 and economic variables were analyzed using principal component analysis. The principal components obtained are more than three for the two semesters with a cumulative variance proportion of more than 75%. Based on the factor analysis method, the COVID-19 variables and economic factors will be grouped. Several tests were carried out before conducting factor analysis, namely the Bartlett test and KMO MSA. The test results state that there are variables that are not significant so they are not involved in further modeling. Based on the data visualization analysis, the positive case variable for COVID-19 is positively correlated with Regional Income compared to wages in the provinces in Java. The results may differ for several provinces in Indonesia.

Keywords: COVID-19, factor analysis, principle component analysis, regional income, wages

Topic: Mathematics