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The Impact Of Trade Costs In Indonesian Agri-Food Sectors: An Interregional Cge Analysis


  • Boys, Kathryn A.
  • Willis, David B.
  • Rum, Irlan A.


Indonesia is a Developing Country (DC) where more than 13 percent of her population live below the poverty line and approximately half of all households are near the national poverty line. While at the national level, Indonesia has sufficient food production to be self supporting, not all regions have the same endowment of agricultural productive capacity which can result in regional shortages. This study examines the extent to which a reduction in Indonesia‟s trade and transport margins can reduce interregional agri-food prices and thus help improve food security. As few studies explore the impact of intra-national trade barriers; this paper makes a unique contribution to this small, but important literature. Findings suggest that reducing trade margin or “soft infrastructure” margins is the more effective approach to improving economic outcomes across Indonesia‟s regions. Further, while reducing trade margins improved the poverty incidence for residence in all regions, the primary beneficiaries of this investment were those that live in urban areas. Results will be of interest to those interested in supporting the welfare of individuals in developing countries, and particularly living in island nations.

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  • Boys, Kathryn A. & Willis, David B. & Rum, Irlan A., 2012. "The Impact Of Trade Costs In Indonesian Agri-Food Sectors: An Interregional Cge Analysis," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124797, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:aaea12:124797

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    References listed on IDEAS

    1. Neil Bania & Laura Leete, 2009. "Monthly household income volatility in the U.S., 1991/92 vs. 2002/03," Economics Bulletin, AccessEcon, vol. 29(3), pages 2100-2112.
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    3. Jonathan E. Hughes & Christopher R. Knittel & Daniel Sperling, 2008. "Evidence of a Shift in the Short-Run Price Elasticity of Gasoline Demand," The Energy Journal, International Association for Energy Economics, vol. 29(1), pages 113-134.
    4. Thomas F. Crossley & Yuqian Lu, 2004. "Exploring the Returns-to-Scale in Food Preparation," Department of Economics Working Papers 2004-06, McMaster University.
    5. Dora Gicheva & Justine Hastings & Sofia Villas-Boas, 2007. "Revisiting the Income Effect: Gasoline Prices and Grocery Purchases," NBER Working Papers 13614, National Bureau of Economic Research, Inc.
    6. Timothy K. M. Beatty & Laura Blow & Thomas F. Crossley, 2014. "Is there a ‘heat-or-eat’ trade-off in the UK?," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 177(1), pages 281-294, January.
    7. Dora Gicheva & Justine Hastings & Sofia Villas-Boas, 2010. "Investigating Income Effects in Scanner Data: Do Gasoline Prices Affect Grocery Purchases?," American Economic Review, American Economic Association, vol. 100(2), pages 480-484, May.
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    Food Security and Poverty; International Development;

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