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The role of local informal financial institutions for sustainability of farmers: a case study of Malang and Batu

Author

Listed:
  • Agus Suman

    (University of Brawijaya, Indonesia)

  • Dwi Budi Santoso

    (University of Brawijaya, Indonesia)

  • Ronny Ersya Novianto Putra

    (University of Brawijaya, Indonesia)

Abstract

The majority of Indonesian farmers are entirely dependent on the activities in the agricultural sector. However, the current agricultural system tends to works against farmers' welfare. This study aims to examine the role of local informal financial institutions in creating sustainable farmer welfare using a qualitative approach. The results of the study indicate that there is a dominant role of local informal financial institutions. This domination causes farmers to become helpless during harvest season, resulting in farmers' dependence on local informal financial institutions and their inability to enjoy sustainable welfare.

Suggested Citation

  • Agus Suman & Dwi Budi Santoso & Ronny Ersya Novianto Putra, 2021. "The role of local informal financial institutions for sustainability of farmers: a case study of Malang and Batu," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 8(3), pages 29-39, March.
    • Handle: RePEc:ssi:jouesi:v:8:y:2021:i:3:p:29-39
    DOI: 10.9770/jesi.2021.8.3(2)
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    References listed on IDEAS

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    1. Eric Akobeng, 2017. "Safety net for agriculture: effect of idiosyncratic income shock on remittance payments," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 44(1), pages 2-20, January.
    2. Simon Berner & Hartmut Derler & René Rehorska & Stephan Pabst & Ulrike Seebacher, 2019. "Roadmapping to Enhance Local Food Supply: Case Study of a City-Region in Austria," Sustainability, MDPI, vol. 11(14), pages 1-16, July.
    3. Alim Setiawan Slamet & Akira Nakayasu & Masahiro Ichikawa, 2017. "Small-Scale Vegetable Farmers’ Participation in Modern Retail Market Channels in Indonesia: The Determinants of and Effects on Their Income," Agriculture, MDPI, vol. 7(2), pages 1-16, February.
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    More about this item

    Keywords

    independent farmers; local financial institutions; farmers' welfare;
    All these keywords.

    JEL classification:

    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • P36 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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