Urban development patterns in Indonesia

The author examines recent urban development in Indonesia. "Analysis of urban developments in Indonesia has been hampered in the past by weak data. Recently, the National Urban Development Strategy (NUDS) project has generated a set of improved data. This paper aims at elaborating and supplementing the NUDS study. After a discussion of definitional problems, an analysis is carried out of urban growth rates at the provincial level. Private investment is shown to be a principal determinant of urban growth rates. Other significant determinants are rural immigration and the present level of urbanisation. Private investment is shown to be strongly biased towards provinces with large urban areas. In addition, polarisation is studied at the level of individual cities. It is found that a period of rapidly increasing polarisation has come to an end during the last decade."     

Non-Agricultural Activities and Income Distribution in Rural Java∗

This paper addresses two problems relating to non-agricultural employment in rural Java, First, four possible determinants of non-agricultural income at the village level are examined: agricultural income, agricultural density, land distribution and location. Of these, the first two appear most significant. Second, the relationship between non-agricultural activities and rural income distribution is evaluated. In relative terms, income from non-agricultural activities is most important for landless and small farm households, although in absolute terms, large farmers derive sizeable income from this source. The evidence is that non-agricultural income serves to moderate income differences within villages.

     

Candidate gene studies and the quest for the entrepreneurial gene

Candidate gene studies of human behavior are gaining interest in economics and entrepreneurship research. Performing and interpreting these studies is not straightforward because the selection of candidates influences the interpretation of the results. As an example, Nicolaou et al. (Small Bus Econ 36:151?C155, 2011) report a significant association between a common genetic variant in the DRD3 gene and the tendency to be an entrepreneur. We fail to replicate this finding using a much larger, independent dataset. In addition, we discuss the candidate gene approach and give suggestions to avoid the publication of false positives.     

Block Rate Pricing of Water in Indonesia: An Analysis of Welfare Effects

Block rate pricing of piped water in Indonesian cities has a progressive structure: the marginal price paid increases with the volume of demand. This paper estimates household water demand in Salatiga city using the Burtless and Hausman model, and finds that its distribution is not unimodal—that data cluster around kinks. The main estimation results are a price elasticity of approximately–1.2 and an income elasticity of 0.05. These elasticities are mutually dependent. The estimated model is used to investigate the social welfare consequences of a shift to uniform pricing. The principal beneficiaries would be large households, which are not necessarily wealthy. While replacing the complex rate structure by a uniform marginal price would have positive effects on average welfare, the equity consequences would be small. To improve equity, water companies could reduce installation fees, giving low-income households access to water connections, or reinvest profits in network expansion to unserviced areas.     

Spatial welfare economics versus ecological footprint: modeling agglomeration,externalities and trade

A welfare framework for the analysis of the spatial dimensions of sustainability is developed. It covers agglomeration effects, interregional trade, negative environmental externalities, and various land use categories. The model is used to compare rankings of spatial configurations according to evaluations based on social welfare and ecological footprint indicators. Five spatial configurations are considered for this purpose. The exercise is operationalized with the help of a two-region model of the economy, that is, in line with the ‘new economic geography.’ By generating a number of numerical ‘counter-examples,’ it is shown that the footprint method is inconsistent with an approach aimed at maximum social welfare. Unless environmental externalities are such a large problem that they overwhelm all other components of economic well-being, a ‘spatial welfare economic’ approach delivers totally different rankings of alternative land use configurations than the ecological footprint.      

Belonging,believing, bonding,and behaving: the relationship between religion and business ownership at the country level

This cross-country study adopts a competing theories approach in which both a value perspective and a social capital perspective are used to understand the relation between religion and a country’s business ownership rate. We distinguish among four dimensions of religion: belonging to a religious denomination, believing certain religious propositions, bonding to religious practices, and behaving in a religious manner. An empirical analysis of data from 30 OECD countries with multiple data points per country covering the period 1984–2010 suggests a positive relationship between religion and business ownership based on those dimensions that reflect the internal aspects of religiosity (i.e., believing and behaving). We do not observe a significant association for those dimensions that reflect more external aspects of religion (i.e., belonging and bonding). These results suggest that the social capital perspective prevails the value perspective, at least when internal aspects of religiosity are concerned. More generally, our study demonstrates the importance of distinguishing between different dimensions of religion when investigating the link between religion and entrepreneurship.     

Creatine and entrepreneurship

Creatine is a nitrogenous organic acid which supplies energy to body cells and enhances physical performance. Using the Young Finns Study combined with the Finnish Linked employer-employee data we show that quantities of creatine measured in 1980 prior to labour market entry affect entrepreneurial success as measured by capital income accumulation over the period 1993–2010 (in particular for females). However, we do not find evidence that creatine affects the propensity to become an entrepreneur. Our study contributes to the emerging literature on biomarkers and entrepreneurship.     

Infrastructure and Industrial Development: The Case of Central Java

Industrial development does not take place in all regions at the same speed. This paper seeks explanations for regional differences in the development of manufacturing industry in Central Java. Special attention is paid to the impact of infrastructure (roads, telecommunications, electricity) on industrial development. The spatial distribution of manufacturing industry is analysed by means of both secondary data at the kabupaten level and primary data on 274 firms in various parts of Central Java. In addition to demand side factors, infrastructure does indeed play an important role, but local government bureaucratic procedures for obtaining land and permits are also important.     

Second-Best Congestion Pricing: The Case of an Untolled Alternative

This paper deals with second-best one-route congestion pricing in case of an untolled alternative. Using a two-link network simulation model, the effects of various demand and cost parameters on the relative efficiency of one-route tolling are analyzed. It is investigated whether the existence of costs of congestion charging may be a reason for one-route tolling to be more “overall efficient” than two-route tolling. Finally, the efficiency of revenue-maximizing one-route and two-route tolling is discussed.     

Housing and Employment in Indonesia: Prospects for Employment Generation in the Construction Materials Sector 1

Indonesia experienced rapid growth in the housing sector in the 1980s, accompanied by large-scale improvement of existing dwellings. There are clear signs of a large potential demand for more and better dwellings; though several bottlenecks exist which hamper this potential. This paper critically examines the credit-related bottleneck and the subsidised credit schemes designed to address it.

Input-output analysis is used in the paper to study the structure of the construction materials sector. Examination shows that the adverse effects of a stimulation of housing demand on the balance of payments are small, and that employment in the construction materials sector is dominated by small-scale and household industry. Finally, an analysis of roofing materials shows that there is scope for further introduction of labour-intensive construction materials.