Social-Economic Reasons to Soil Conservation An Econometric Analysis on Cross-Sectional Lore Lindu Data

IndonesianKonservasi tanah memiliki peranan penting dalam menentukan keberlanjutan sektor pertanian. Tujuan penelitian ini adalah menganalisis faktor-faktor yang mempengaruhi keputusan petani untuk mengkonservasi atau tidak mengkonservasi lahan pertaniannya. Penelitian ini menggunakan data primer sampel petani sawah di sekitar kawasan Taman Nasional Lore Lindu (TNLL). Dari sampel tersebut, hanya 13,5 persen saja yang melakukan konservasi lahan. Di antara hasil penelitian ini, ditemukan bahwa ternyata konservasi lahan merupakan variabel endogenus, yang berarti keputusan petani untuk mengkonservasi (atau tidak mengkonservasi) lahan tergantung pada beberapa faktor. Faktor yang berpengaruh nyata di antaranya ialah jumlah output yang dihasilkan, persepsi kualitas lahan, jumlah anggota rumah tangga petani, dan usia petani. Dengan menggunakan pendekatan instrumental variable, ditemukan bahwa keputusan untuk mengkonservasi (atau tidak mengkonservasi) lahan berpengaruh nyata terhadap jumlah output yang dihasilkan. Output tersebut juga dipengaruhi oleh luas areal dan—dengan taraf signifikansi yang lebih lemah—oleh jumlah kredit. Agar usahatani berkelanjutan, pemerintah disarankan untuk menentukan batas-batas TNLL secara jelas, mengeluarkan sertifikat tanah, dan memperbaiki akses petani kepada kredit mikro. EnglishSoil conservation plays critical role on agricultural sustainability. The aims of this study are to analyze factors affecting farmers’ decision to conserve or not to conserve their farming land and to evaluate simultaneously effects of such decision on their output. The study uses data gathered from samples of wetland rice farmers in the surrounding area of the Lore Lindu National Park (LLNP). There are only 13.5 percent of the farmers undertaking soil conservation. Soil conservation is found to be an endogenous variable, implying that farmers’ decision to conserve (or not to conserve) depends on a number of factors. Among these factors, the significant ones are quantity of output produced, the perceived quality of farm land, farmer’s family size, and age of the farmer. Using the instrumental variable approach, it is found that the decision of whether or not to carry out soil conservation affects the output significantly. This output is also affected by acreage and, to a lesser significance level, by the amount of credit. The government is recommended to establish clear boundaries of the LLNP, issue proper land rights, and improve accesses to micro-credit in order to promote sustainable agricultural practices

Elasticities of Output Supply and Input Demand of Indonesian Foodcrops and Their Policy Implications: Multi-input Multi-output Framework*)

It is a commonly practiced that agricultural economists frame their analyses within the single commodity (multi-input single-output) framework. The problem with this framework is that this seems to be inappropriate because most agricultural production systems are characterized by multi-product farms. Motivated by this problem, this paper is aimed at providing a brief explanation on the multi-input multi-output (MI-MO) framework and applying the framework on the Indonesian food crops subsector. Based on this framework, an econometric model is specified and then estimated using the restricted seemingly unrelated regression method. Estimated cross-price elasticities obtained from the model suggest the significance of cross-effects of input or output prices on input demand or output supply, justifying the MI-MO nature of the crops. The most notable policy implication from this study is that a price policy on either outputs or inputs may not be effective. If, however, such a policy were politically desirable, it should be applied on inputs rather than on outputs because the magnitudes of the elasticities are in absolute term higher in input demands than in output supplies

Impact of a Lower Oil Subsidy on Indonesian Macroeconomic Performance, Agricultural Sector and Poverty Incidences: a Recursive Dynamic Computable General Equilibrium Analysis

Budget deficit, exchange rate fluctuation and high fuel world price provides a pressure on budget capacity to stimulate the Indonesian economy. The government has designed several fiscal policies, including reducing the fuel subsidy. The study objective is to analyse the impact of reducing fuel subsidy on macroeconomic variables, agricultural sector, and income distribution. The modification on the basic model, which is a recursive-dynamic CGE model, is made in this study. The data used in the model is of the Indonesian I-O Table 2000, The Indonesian Social Accounting Matrix 2000, National Household Survey data and parameter from some other sources. The results show that the reduction in fuel price subsidy tends to increase prices of industrial outputs that highly depend on fuel, such as transportation and fishery sectors. In contrast, the change in fuel price does not influence the price of paddy. Wage of skilled labor, land rent, and capital rent decline steadily in response to the change in fuel price. Households will lose their income following the reduction in fuel subsidy, which then decreases the welfare of households. Incomes are not evenly distributed within the society (household groups). An increased fuel price at consumer level declines the Indonesian real GDP. The government should give the compensation of reducing the fuel subsidy directly to the poor people. The compensation can also be given directly to the poor people through the development of infrastructure, which may solve some supply side bottlenecks in the economy.Fuel subsidy, income distribution, recursive dynamic CGE

Agricultural Development in Indonesia: Current Problems, Issues, and Policies

After around a decade since the Asian Financial Crisis, the Indonesian economy has still experienced a relatively slow growth. The growth has tended to increase, but is considerably lower than that of the pre-crisis era. With a relatively low level and the quality of growth, the high rates of unemployment and poverty have been difficult to reduce. Despite its potential role of reducing the rates of poverty and unemployment, agricultural growth and rural development have yet tended to be stagnant. Development efforts, on both agriculture and non-agriculture, have still been concentrated in Java whereby land availability is very limited. The problems of poverty and unemployment seem to have intensified less-sustainable agricultural practices, giving rises—at least partially—to more land degradation and threats to water sustainability. To overcome the problems, the country needs sound/comprehensive agricultural and rural development policy. Effectiveness of such policy in overcoming the problems would depend much on the integration of serious efforts to enhance agricultural productivity as well as to improve rural infrastructure and social-economic institutions

DETERMINANTS AFFECTING PROFITABILITY AND STOCK RETURNS FOR SMALLER BANKS LISTED ON THE INDONESIA STOCK EXCHANGE

In running businesses and their operations, banks are required to earn profits. Profits earned by banks provide an added value for banks, especially for shareholders if the stock price increase. This research was conducted at 18 banks in BUKU II bank categories that already listed on the Indonesia Stock Exchange or Go Public. The purpose of this study was to determine factors influence profitability and stock returns banks in groups of BUKU II Go public. The study was conducted using secondary data from January 2014 to December 2018. In order to analyze the factors that influence firms’ profitability and stock returns, data processed using panel data regression analysis. The results showed that significant factor affects profitability were total assets, non-performing loans (NPL), capital adequacy ratio (CAR), net interest margin (NIM), and the number of employees. Furthermore, a significant factor that affects stock returns is good corporate governance (GCG) and the number of electronic banking variations that are owned. The resulting research has managerial implications for the banks in maintaining several important financial ratios such as CAR, NPL, NIM, and also developing electronic banking and implementing GCG in every business process carried out. Keywords: determinant factors, go public, panel data regression, profitability, stock retur

WHAT MAKES INDONESIA'S SUSTAINABLE INVESTMENT BETTER THAN SHARIAH AND LIQUID?

This study aimed to compare the performance of SRI-KEHATI, lq45, and JII weekly data set from 2009 to 2020, covering 100 companies' stocks as members of the indices. Data were standardized within index weighting, followed by non-parametric methods as they were not as susceptible to outliers as the parametric tests were. The performance evaluation used both Kruskal-Wallis and Mann-Whitney U tests. The result showed that SRI- KEHATI had the largest average risk and returns, among others, supported by the fact that investors will choose stocks or indices based on financial aspects and values on ethics, religiosity, and liquidity aspects. It also showed that SRI-KEHATI is best suited for collecting financial, social, and ethical returns at the same time. We also found out from the Mann-Whitney U test that one of the reasons for SRI-KEHATI's performance was due to the major allocation to the four major banks. There was a significant difference between SRI-KEHATI and the performance of the four banks that have been the stock movers all the way, so investors could select the cherry-picking strategy focusing on those stocks instead. This study has managerial implications for investors and fund managers looking for competitive returns amongst three indices where SRI investment is favorable, targeting higher return and awareness of the higher risk and volatilities. Keywords: equity, liquid, non-parametric, sharia, sustainable responsible investmen

Volatility and Stability of ESG Equity in Indonesia toward Internal and External Shocks

The Environmental, Social and Governance (ESG) index is rising in popularity globally especially in Indonesia. This study attempts to prove that ESG equity is less volatile than non-ESG equity, since specific components of ESG are essentially parts of the Shariah values. Using data from 2009 through 2020, the Vector Error Correction Model (VECM) method was utilized to further investigate the link between ESG and other endogenous variables such as the DJIM (Dow Jones Islamic Market), Fed rate, JCI (Jakarta Composite Index) index, exchange rate, and BI rate. The results show that all internal and external variables significantly influence ESG equity in very low magnitude, except for DJIM negatively and Fed rate positively. However, the IRF findings reveal what transpired to the ESG equity, which was able to endure shocks from both internal and external simultaneously, and to stabilize more swiftly. Moreover, the FEVD results shows that all internal and external variables have little impact to ESG equity totaling less than 9 per cent. Meanwhile, the impact of the same variables to non-ESG equity, i.e., JCI and DJIM, are higher at 38 per cent and 13 per cent, respectively. In addition, ESG equity tends to have a dominant influence on other non-ESG equity. Therefore, the Indonesian stock market will be more stable if ethical investing norms, such as ESG equity, are followed, which will be more judicious in order to achieve long-term growth

Dampak Kebijakan Harga Pangan Dan Kebijakan Moneter Terhadap Stabilitas Ekonomi Makro

EnglishThe relatively high share of food expenses in household expenditure indicates that contribution of food prices to the inflation rate is still quite high. Inflation and its fluctuations are important variables affecting macroeconomic stability. Therefore, stabilizing food prices, which could lead to a more stable inflation, might potentially result in a more stable macroeconomy. Food price policy might play important role in stabilizing food prices; but could also disturb the stability if implemented improperly. This paper aims at analyzing effects of food price as well as monetary policies on macroeconomic indicators. For this analysis, quarterly data of the period 1980.1 to 2004.4 were utilized. The study used a Vector Error Correction Model (VECM), from which Impulse Response Function (IRF) analyzes were carried out. The results suggest that: (1) food price policy could not cause instability of macroeconomy, and (2) food price policy could not affect the unemployment rate, while monetary policy could do.IndonesianMasih besarnya pangsa pengeluaran pangan pada sebagian besar kelompok masyarakat berarti bobot inflasi kelompok pangan terhadap inflasi masih cukup besar. Inflasi dan fluktuasinya dapat mempengaruhi stabilitas ekonomi makro. Jadi stabilitas harga pangan dan harga-harga di tingkat makro secara potensial dapat dilakukan dengan menerapkan kebijakan harga pangan. Namun, kebijakan harga pangan yang tidak tepat dapat juga menyebabkan ketidakstabilan ekonomi makro. Tulisan ini bertujuan untuk menganalisis dampak kebijakan harga pangan dan kebijakan moneter terhadap keseimbangan dan stabilitas indikator-indikator ekonomi makro. Data yang digunakan merupakan data sekunder deret waktu triwulanan untuk periode 1980.1 - 2004.4. Analisis data menggunakan model VECM (Vector Error Correction Model) dan teknik IRF (Impulse Response Function). Hasil analisis menunjukkan bahwa kebijakan harga pangan tidak menyebabkan instabilitas ekonomi makro, sedangkan kebijakan moneter menyebabkan peningkatan angka pengangguran