This research study about Analysis Effectiveness of International Trade toward Poverty Reduction in Indonesia. This thesis analyzes the effectiveness of international trade toward poverty reduction in Indonesia using GLS (Generalized Least Square) by using cross-province data and regress it each year from 2000-2008. Variables used are povefty rate (P) as a dependent variable and trade openness (TO), foreign direct investnent (FDI), unemployment (U), consumption (C) as an independent variables. Based on empirical result, suggests that trade openness and FDI are not significant and has negative relationship in order to decrease pover{y rate. Furthennore, unemployment rate and consumption are significant but unemployment has positive relationship and consumption has negative relationship in order to decrease poverty rate. That means, only unemployment rate and consumption had been effective toward poverly reduction in Indonesia
