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Economic welfare analysis of policy‐induced structural change in the Indonesian poultry industry

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  • Endang Suwartini
  • H. Garth Coffin
  • Kisan Gunjal

Abstract

The performance of the poultry industry in Indonesia is analyzed in terms of changes in producer and consumer welfare as a result of public policy intended to limit the size of production units in order to distribute growth opportunities to smallet farms. Elasticities of supply and demand are estimated using the seemingly unrelated system of equations. The hypothesis of a policy‐induced structural change, estimated through a dummy variable accounting for a shift in supply associated with implementation of the policy, shows a negative impact on the output supplied and the welfare of producers and consumers to the tune of about Rp 94 billion or roughly about 0.1% of national income as of 1983. The study suggests an important trade‐off between more equitable income distribution and economic efficiency.

Suggested Citation

  • Endang Suwartini & H. Garth Coffin & Kisan Gunjal, 1997. "Economic welfare analysis of policy‐induced structural change in the Indonesian poultry industry," Agricultural Economics, International Association of Agricultural Economists, vol. 16(3), pages 237-243, August.
    • Handle: RePEc:bla:agecon:v:16:y:1997:i:3:p:237-243
    DOI: 10.1111/j.1574-0862.1997.tb00458.x
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    Cited by:

    1. Stein Kristiansen, 2003. "Information Asymmetry and Economic Concentration: The case of hens and eggs in eastern Indonesia," Working Papers 03-21, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).

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