ELASTICITY OF INPUT SUBSTITUTION, TECHNOLOGICAL CHANGES AND SCALE ECONOMICS : CASE OF OIL PALM PLANTATION IN RIAU PROVINCE, INDONESIA

ABSTRAK

Perkembangan perladangan kelapa sawit di Propinsi Riau merupakan satu daripada yang tertinggi di Indonesia. Kajian ini menguji sifat dasar penggunaan faktor input dalam menghasilkan pertumbuhan kelapa sawit di propinsi ini. Secara khusus kajian bertujuan mengukur keanjalan penggantian input, perubahan teknologi dan skel ekonomi bagi kes perladangan kelapa sawit di Propinsi Riau Indonesia. Kajian ini menggunakan gabungan data keratan lintang dan siri masa daripada 20 firma selama jangka masa 7 tahun (1997-2003). Pendekatan fungsi kos translog telah digunakan terhadap empat input pengeluaran (tanah, buruh, modal dan input pertengahan), output dan pembolehubah aliran masa. Hasil kajian menunjukkan hubungan kemudahgantian diantara input adalah sangat tidak anjal dan tidak penting. Keputusan ini menggambarkan bahawa peluang penggantian input-input lain terhadap tanah sangat kecil, khususnya dalam menghadapi penawaran tanah yang semakin berkurangan bagi pengembangan perladangan kelapa sawit di Propinsi Riau. Perubahan teknologi kelapa sawit di Propinsi Riau didapati berimbuhan buruh, manakala input-input lain menjadi faktor penjimatan. Perubahan teknologi tulen secara keseluruhan menyebabkan kos pengeluaran berkurangan sebanyak 8.7 peratus. Keputusan ini diperkuat oleh hasil penganggaran keanjalan kos dan skel yang kurang dan lebih besar daripada satu secara berturut-turut. Keseluruhan keputusan membayangkan bahawa perladangan kelapa sawit di Propinsi Riau mengalami kos purata berkurangan, yang dicirikan oleh pulangan meningkat ikut saiz industri. Secara langsung ini menggambarkan nilai-nilai ekonomi yang sangat menarik daripada industri. Dalam jangka panjang pengembangan perladangan kelapa sawit di Propinsi Riau menjadi terbatas kerana kekurangan tanah serta sangat rendahnya hubungan penggantian input. Dalam jangka pendek sektor perladangan kelapa sawit akan tetap menjadi penting dalam menyediakan peluang pekerjaan serta menyumbang kepada Keluaran Dalam Negara Kasar (KDNK) daerah.


Kata kunci : Kelapa Sawit, Keanjalan Penggantian Input, Perubahan Teknologi
dan Skel Ekonomi.


ELASTICITY OF INPUT SUBSTITUTION, TECHNOLOGICAL CHANGES AND SCALE ECONOMICS : CASE OF OIL PALM PLANTATION
IN RIAU PROVINCE, INDONESIA

ABSTRACT

The expansion of oil palm plantation in Riau Province, Indonesia has been one of the highest in the country. This study examines the nature of factor inputs use in generating oil palm growth in the province. Specifically, the study aims to measure the elasticity of input substitution and technological change for the case of oil palm plantation in Riau Province, Indonesia. This study utilized pooled cross-sectional and time series data from 20 firms over a period of 7 years (1997 – 2003). The Translog cost function approach was employed on four production inputs (land, labor, capital, and intermediate inputs), output and a time trend variable. Results indicate that substitution relationships among inputs are highly inelastic and negligible. This findings suggest that there is very little prospect for other inputs to substitute for land, especially in the face of dwindling land supply for oil palm expansion in Riau Province. Oil palm technological changes in Riau Province were found to be labor augmenting while all other inputs were factor saving. Overall pure technological change has resulted in a decrease in production cost by as much as 8.7 percent. This finding is reinforced by the cost and scale elasticity estimates of less and greater than one, respectively. Overall findings suggest that the oil palm plantation in Riau Province has experienced a declining average cost, which characterized an increasing return to size industry. This directly reflects the commercial attractiveness of the industry. There is limited scope for oil palm expansion in Riau Province in the long-run due to land scarcity as well as the very low factor substitution relationship. In the short-run the oil palm sector will continue to the important in terms of employment opportunities as well as provincial GDP contribution.


Key Words : Oil Palm, Elasticity of input substitution, Technical Changes
and Economic Scale