Regional Economic Modelling for Indonesia: Implementation of Irsa-Indonesia5

Ten years after Indonesia implemented a major decentralisation policy, regional income per capita disparity and excessive rate of natural resource extraction continue to be pressing issues. There are great interests in identifying macro policies that would reduce regional income disparity and better control the rate of natural extraction, whilemaintaining reasonable national economic growth. This paper utilises an inter-regional computable general equilibrium model, IRSA-INDONESIA5, to discuss the economy-wideimpacts of various policies dealing with the development gap among regions in the country, achieving low carbon growth, and reducing deforestation. The results of simulations conducted reveal that, primarily, the best way to reduce the development gap among regions is by creating effective programs to accelerate the growth of human capital in the less developed regions. Secondly, in the short-term, the elimination of energy subsidies and/or implementation of a carbon tax is effective in reducing CO2 emission and producing higher economic growth, while in the long-run, however, technological improvement, particularly toward a more energy efficient technology, is needed to maintain a relatively low level of emission with continued high growth. Thirdly, if reducing deforestation means reducing the amount of timber harvested, it negatively affects the economy. To eliminate this negative impact, deforestation compensation is needed

The Socioeconomic and Health Status of Rural–urban Migrants in Indonesia

This paper seeks to answer whether or not rural–urban migrants “make it”, i.e. whether or not they are able to, at least, achieve a socioeconomic and health status similar to that of their nonmigrant counterparts living in the same city. using specifically collected data on rural–urban migration, this study finds that, after controlling for various characteristics, migrants' household incomes are significantly higher than those of nonmigrants. they also have a significantly lower probability to be absolutely poor than nonmigrants. their health performance and that of their children are also no different from the health status of nonmigrants. there is only weak, and not robust, evidence that children of migrants have a higher probability of being significantly underweight. their children's educational performances do not lag behind. in fact, for lifetime migrants, there is evidence that their children's educational attainments are significantly better than those of nonmigrants' children. therefore it can be inferred that the process of rural-to-urban migration in Indonesia is not a harmful process. in fact, it has been found to be beneficial to the socioeconomic condition of the migrants. it is a way to provide a better life for poor rural people. to allow this process to happen naturally, the government needs to reduce unnecessary barriers to rural people who want to move to urban areas. key words: rural–urban migration, Indonesia, socioeconomic status, health, educatio

Tingkat Ekstraksi Optimal Minyak Bumi Indonesia: Aplikasi Model Optimasi Dinamik

Indonesia merupakan salah satu negara dengan sumber daya mineral yang masih tergolong besar, diantaranya minyak. Minyak menjadi penting dalam perekonomian karena sektor ini memberi kontribusi yang masih cukup signifikan terhadap PDB, ekspor maupun pendapatan pemerintah. Selain itu, struktur energi primer Indonesia juga masih didominasi oleh minyak bumi.Sebagai sumber daya yang dapat habis dan tidak terbarukan, eksploitasi minyak bumi saat ini mengandung opportunity cost di mana akan mengurangi ketersediaan minyak bumi untuk generasi mendatang. Sehingga, pertanyaan yang dapat muncul kemudian adalah: Apakah minyak bumi dieksploitasi terlalu cepat atau terlalu lambat?Dengan menggunakan optimasi dinamik akan dilakukan simulasi yang menghasilkan alur ekstraksi (extraction path) yang optimal yang memaksimumkan nilai sekarang dan keuntungan netto akan extraksi minyak bumi. Hasil ini akan dibandingkan dengan tingkat produksi yang menggunakan perilaku ‘business as usual'.Kesimpulan yang didapat dan simulasi adalah dalam skenario optimal, cadangan akan lebih cepat habis dibandingkan skenario biasa (business as usual), walaupun profit yang didapat lebih tinggi. Beberapa faktor yang harus dipertimbangkan dalam membandingkan hasil ini kemudian adalah penerimaan pemenintah, cadangan devisa dan kapasitas terpasang dan pengeboran minyak

Analisis Dampak Kebijakan Harga Energi Terhadap Perekonomian Dan Distribusi Pendapatan Di DKI Jakarta: Aplikasi Model Komputasi Keseimbangan Umum

Studi ini hendak menganalisa dampak dan kebijakan harga energi Indonesia terhadap perekonomian kota Jakarta; khususnya terhadap pendapatan rumah tangga miskin. Studi ini juga berusaha memformulasikan kebijakan regional yang penting bagi Jakarta untuk menurunkan dampak negative dan kebijakan energi nasional ini terhadap pendapatan rumah tangga miskin. Untuk mencapai tujuan ini, dibangun sebuah model CGE (computable general equilibrium) regional. Model ini merupakan model CGE pertama di Indonesia yang dikembangkan untuk sebuah kota

Decentralization of forest administration in Indonesia: implications for forest sustainability, economic development and community livelihoods

Since the collapse of Soeharto’s New Order regime in May 1998, Indonesia’s national, provincial, and district governments have engaged in an intense struggle over how authority and the power embedded in it, should be shared. How this ongoing struggle over authority in the forestry sector will ultimately play out is of considerable significance due to the important role that Indonesia’s forests play in supporting rural livelihoods, generating economic revenues, and providing environmental services. This book examines the process of forestry sector decentralization that has occurred in post-Soeharto Indonesia, and assesses the implications of more recent efforts by the national government to recentralize administrative authority over forest resources. It aims to describe the dynamics of decentralization in the forestry sector, to document major changes that occurred as district governments assumed a greater role in administering forest resources, and to assess what the ongoing struggle among Indonesia’s national, provincial, and district governments is likely to mean for forest sustainability, economic development at multiple levels, and rural livelihoods. Drawing from primary research conducted by numerous scientists both at CIFOR and its many Indonesian and international partner institutions since 2000, this book sketches the sectoral context for current governmental reforms by tracing forestry development and the changing structure of forest administration from Indonesia’s independence in 1945 to the fall of Soeharto’s New Order regime in 1998. The authors further examine the origins and scope of Indonesia’s decentralization laws in order to describe the legal-regulatory framework within which decentralization has been implemented both at the macro-level and specifically within the forestry sector. This book also analyses the decentralization of Indonesia’s fiscal system and describes the effects of the country’s new fiscal balancing arrangements on revenue flows from the forestry sector, and describes the dynamics of district-level timber regimes following the adoption of Indonesia’s decentralization laws. Finally, this book also examines the real and anticipated effects of decentralization on land tenure and livelihood security for communities living in and around forested areas, and summarizes major findings and options for possible interventions to strengthen the forestry reform efforts currently underway in Indonesia

Compliance of smallholder timber value chains in East Java with Indonesia's timber legality verification system

The Indonesian Timber Legality Verification System (SVLK) has been developed primarily to address illegal logging in Indonesia, and is licensed under the European Union's Forest Law Enforcement, Governance and Trade (FLEGT) Action Plan. While SVLK was catalysed by concerns about the legality of wood originating from natural forests, it applies to all wood production in Indonesia, including smallholders harvesting planted trees. This study investigates SVLK implementation in value chains originating from smallholder forests planted on private land in East Java Province, where these forests are important assets for both farmers and the forest industries. It follows value chains for two manufactured wood products, blockboard and plywood. There are specific SVLK requirements for each value chain actor, other than the market brokers in these chains. Results reveal the limitations of SVLK architecture in relation to smallholder value chains, variation in compliance practices, and points of ‘illegalisation’ and legalization within the value chains. The blockboard and plywood products from each case study chain claimed SVLK compliance. However, only one of the two case study chains for each product was compliant up to the blockboard or plywood manufacturing stage; and no distinction was made at this stage between SVLK-compliant and non-compliant wood. Consequently, none of the final products from any case study chain are SVLK-compliant. These results illustrate the challenges of designing and implementing timber legality systems for smallholder value chains, and suggest areas of focus to improve SVLK for smallholder value chains