A Cluster-Based Multi-Criteria Decision-Making Approach for Regional Economic Development Prioritization Using AHP–SAW
DOI:
https://doi.org/10.30871/jaic.v10i2.12445Keywords:
Development Priority, Hybrid AHP–SAW, Multi-Criteria Decision Making (MCDM), Regional Clustering, Regional Economic DevelopmentAbstract
Determining regional economic development priorities requires an analytical approach capable of accommodating regional heterogeneity and the complexity of macroeconomic indicators. This study aims to identify regional economic development priorities by integrating clustering techniques and a hybrid Analytical Hierarchy Process (AHP)–Simple Additive Weighting (SAW) method. The clustering approach is employed to group regions into relatively homogeneous clusters based on economic indicators, allowing for more context-sensitive priority analysis. Subsequently, the AHP method is applied to determine the relative importance of criteria within each cluster, while the SAW method is used to rank regional economic development alternatives. The study analyzes 38 regencies and municipalities in East Java using six macroeconomic indicators obtained from official Statistics Indonesia (BPS) publications. The results indicate that both criteria weights and priority development alternatives differ across clusters, reflecting variations in regional characteristics and economic challenges, such as the predominance of competitiveness issues in advanced regions, employment expansion in developing regions, and poverty alleviation along with the fulfillment of basic needs in underdeveloped regions. This approach enables more adaptive, objective, and data-driven development policy formulation. Conceptually, this study contributes to the development of a multi-criteria decision-making framework that supports the achievement of the Sustainable Development Goals (SDGs), particularly SDG 1 (No Poverty), SDG 8 (Decent Work and Economic Growth), and SDG 10 (Reduced Inequalities) and the Indonesia Emas 2045 Vision agenda, particularly in promoting inclusive and equitable regional economic development.
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