Demand for kerosene in developing countries: A case of Indonesia

This paper attempts to examine the determinants of kerosene consumption in Indonesia. Derived from annual data for the period 1957–1992, the statistical results suggest that in addition to the past conditions, the price of kerosene, price elasticity, and the per capita income are the main determinants of kerosene consumption in Indonesia. The estimated cross-elasticity value with respect to the price of elasticity implies that electricity is a weak substitute for kerosene.     

Bimas: A New Approach to Agricultural Extension in Indonesia

The Bimas programme of agricultural extension was conceived by a small group of young men without prior experience in extension work. The people who work with the farmers are also young and without extension experience, fourth and fifth year students from the colleges of agriculture. Yet the programme has been very successful in encouraging farmers to increase their production.     

Differential Demand Systems: A Further Look at Barten's Synthesis

Barten's synthetic model is attractive to applied researchers since it is useful for testing the adequacy of the competing functional forms of differential demand systems including the popular Rotterdam and almost ideal demand systems. This article shows that the synthetic model is not a mere artificial composite of the known differential demand systems as it has been considered, but rather viewed as a model in its own right. It is demonstrated that, at the individual consumer level, Barten's model has the same marginal budget shares as generated by specific forms of Engel curves formulated by the Box-Cox transformation.     

Openness, Technological Change and Labour Demand in Pre-Crisis Indonesia

This paper examines the impact of export orientation, import competition, foreign ownership and the rate of capital accumulation on the relative demand for skilled and unskilled labour in pre-crisis Indonesia. Estimates from an interrelated factor demand analysis indicate that openness and foreign ownership, by themselves, acted to raise the relative demand for unskilled workers in the pre-crisis period, while the newness of capital was associated with increased relative demand for skilled workers. Overall, the relative demand for unskilled workers increased yet their relative wage position weakened. These contrasting relative employment and wage changes are consistent with the examined demand shocks and the greater elasticity of supply of Indonesian unskilled relative to skilled labour.     

Export Demand and Botswana's Beef Industry: A Computable General Equilibrium Approach

Abstract: A 15-sector Comparable General Equilibrium (CGE) model, based on 1992/93 Social Accounting Matrix (SAM), is used to simulate the effects of changes in the world price of beef on the Botswana's beef industry, employment, exports and aggregate output. Résumé: Un modèle d'équilibre général comparable à 15 secteurs, fondé sur la matrice de comptabilité sociale (MCS) de 1992/93, est utilisé pour simuler les incidences des fluctuations des prix mondiaux de la viande bovine sur l'industrie du boeuf, l'emploi, les exportations et la production globale au Botswana.     

The Role of Markets,Technology, and Policy in Generating Palm-Oil Demand in Indonesia

Indonesia produces more palm oil and consumes more palm oil per capita than any country in the world. This article examines the processes through which Indonesia has promoted palm-oil consumption and some of the consequences of that promotion. Partial equilibrium modelling shows that Indonesia's remarkable increase in palm-oil consumption since 1985 is not largely attributable to population and income growth. Instead, much of this consumption growth has resulted from substitution away from coconut oil, facilitated by government policies on technology, pricing, distribution, and trade. The switch from coconut oil to palm oil in Indonesia was associated with increased land conversions to agriculture and diminished smallholder competitiveness. Despite lower rates of cooking-oil substitution in the future, simulations suggest that Indonesia's total palm-oil consumption in 2035 will be at least double that of 2010.     

Gender Discrimination in Earnings in Indonesia: A Fuller Picture

This article analyses data from the 2007 Indonesia Family Life Survey in order to decompose the gender gap in earnings into explained and unexplained gaps, not only at the mean but also across the entire distribution. Women earned about 30% less than men, in both paid work and self-employment. The explained gap accounts for only about a quarter of the gap in paid work but for about half of the gap in self-employment. When the decomposition is made across the earnings distribution, the total gap decreases with earnings in both paid work and self-employment, and both conditional and unconditional on characteristics. In both employment sectors, the explained gap remains similar across the distribution, and therefore the unexplained gap drives the decrease in the total gap. The unconditional decomposition across the distribution provides great insight into the dynamics that are obscured in results derived from decomposition at the mean.     

The Demand for Money for EMU: a Flexible Functional Form Approach

Monetary aggregates have a special role under the “two pillar strategy” of the ECB. Hence, a theoretically consistent measure of monetary aggregates for the European Monetary Union (EMU) is needed. This paper analyzes aggregation over monetary assets for the EMU. We aggregate over the monetary services for the eleven EMU (EMU-11) countries, which include Estonia, Finland, France, Germany, Ireland, Italy, Luxembourg, Malta, Netherlands, Slovakia, and Slovenia. We adopt the Divisia monetary aggregation approach, which is consistent with index number theory and microeconomic aggregation theory. The result is a multilateral Divisia monetary aggregate, in accordance with Barnett (J Econ 136(2):457–482, 2007). The multilateral Divisia monetary aggregate for the EMU-11 is found to be more informative and a better signal of economic trends than the corresponding simple sum aggregate. We then analyze substitutability among monetary assets for the EMU-11 within the framework of a representative consumer’s utility function, using Barnett’s (J Bus Econ Stat 1:7–23, 1983) locally flexible functional form, the minflex Laurent indirect utility function. The analysis of elasticities with respect to the asset’s user-cost prices shows that: (i) transaction balances and deposits with agreed maturity are income elastic and (ii) the monetary assets are not good substitutes for each other within the EMU-11. Simple sum monetary aggregation assumes that component assets are perfect substitutes. Hence simple sum aggregation distorts measurement of the monetary aggregate. The ECB provides Divisia monetary aggregates to the Governing Council at its meetings, but not to the public. Our European Divisia monetary aggregates will be expanded and refined, in collaboration with Wenjuan Chen at the Humboldt University of Berlin, to a complete EMU Divisia monetary aggregates database to be supplied to the public by the Center for Financial Stability in New York City.     

Fiscal decentralization in Indonesia: A comment on smoke and lewis

In World Development Smoke and Lewis (1996) describe a local government capability rating effort in Indonesia, and conclude that this approach to decentralization has great potential. Their analysis is bound to a limited set of central level actors, and thus reflects only part of the decentralization debate in Indonesia. Consequently the authors miss the roots of this purportedly “new” approach and overestimate its actual or possible effects. Smoke and Lewis have also not taken into account the importance of a vastly different approach to decentralization, the regional autonomy pilot program, which was inaugurated by the Indonesian Government in April 1995. Providing the broader context to the rating effort, we try to reveal its conceptual and practical limitations and point on the ambiguous role of the rating effort in the decentralization arena in Indonesia.