Article Sidebar

Submitted
January 27, 2020
Accepted
June 6, 2020
Published
July 12, 2020
Download
PDF
Statistic
Read Counter : 656 Download : 438

Downloads

Download data is not yet available.

Main Article Content

Abstract

Small industries are life-sustaining for communities because of their political and strategic position in terms of creating job opportunities and increasing revenue. One small industrial sector that has the potential to be developed is the food industry. Small food industries are widely scattered in every area, including in the city of Palembang. A small industrial group of food that became one of the culinary icons in Palembang is the cracker industry. This type of industry is a culinary icon that has been famous for foreign countries. Nevertheless, the cracker industry is still experiencing obstacles in terms of capital and marketing. The cost of raw materials is relatively expensive to technically trigger the industry inefficiencies. Therefore, it is necessary to review the technical efficiency of this small industry.  The variables used in this study were capital, labor, and output. The data used is secondary data that is analyzed by using the Stochastic Frontier Analysis (SFA) approach. The results showed that the technical efficiency achievement of small industrial crackers in South Sumatera is still categorized as low. The use of labor input is more effective than capital use as a result of the utilization of technology and local resources. Therefore, the development of small industrial crackers through an efficiency approach cannot be separated from the application of technology, human resource management, marketing, and business climate.

Keywords

technical efficiency stochastic frontier small industry

Article Details

License

Authors who publish with this journal agree to the terms:

Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution-ShareAlike 4.0 International License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.

Creative Commons License

Jurnal Ekonomi Pembangunan is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License..

Author Biography

Mukhlis Mukhlis, (SCOPUS ID: 57207305489) Faculty of Economics, Universitas Sriwijaya

Department of Development Economics
How to Cite
Mukhlis, M. (2020). Examining the technical efficiency of small industries: A case study of the crackers industry in South Sumatera, Indonesia. Jurnal Ekonomi Pembangunan, 18(1), 13–20. https://doi.org/10.29259/jep.v18i1.10847
Download Citation
Endnote/Zotero/Mendeley (RIS)
BibTeX

References

  1. Aigner, D., Lovell, C. A. K., & Schmidt, P. (1977). Formulation and estimation of stochastic frontier production function models. Journal of Econometrics, 6(1), 21–37. https://doi.org/https://doi.org/10.1016/0304-4076(77)90052-5
  2. Aquilina, M., Klump, R., & Pietrobelli, C. (2006). Factor substitution, average firm size and economic growth. Small Business Economics, 26(3), 203–214. https://doi.org/10.1007/s11187-005-4715-4
  3. Asmara, R., Hanani, N., & Irawati, N. (2011). The Analysis of Technical Efficiency with Frontier Approach in Business of Chips MOCAf (Modified Cassava Flour). Habitat, XXII(1), 52–59.
  4. Atherton, A. (2005). A Future for Small Business? Prospective Scenarios for The Development of The Economy Based on Current Policy Thinking and Counterfactual Reasoning. Futures, 37(8), 777–794. https://doi.org/https://doi.org/10.1016/j.futures.2005.01.002
  5. Battese, G. E. (1992). Frontier Production-Functions and Technical Ffficiency-A Survey of Empirical Applications in Agricultural-Economics. Agricultural Economics, 7, 185–208. https://doi.org/10.1016/0169-5150(92)90049-5
  6. Central Bureau Statistics of South Sumatra. (2017). South Sumatra in Figure 2017. Central Bureau Statistics of South Sumatra.
  7. Coelli, T. J., Prasada Rao, D. S., O’Donnell, C. J., & Battese, G. E. (2005). An introduction to efficiency and productivity analysis. In An Introduction to Efficiency and Productivity Analysis. https://doi.org/10.1007/b136381
  8. Coelli, T. J., Rao, D. S. P., O’Donnell, C. J., & Battes, G. E. (2005). An introduction to efficiency and productivity analysis. In Biometrics (Vol. 41). https://doi.org/10.2307/2531310
  9. Farrell, M. J. (1957). The Measurement of Productive Efficiency. Journal of the Royal Statistical Society. Series A (General), Vol. 120, p. 253. https://doi.org/10.2307/2343100
  10. Jehle, G. a, & Reny, P. J. (2001). Advanced Microeconomic Theory. In Annals of Physics (Vol. 2).
  11. Jondrow, J., Knox Lovell, C. A., Materov, I. S., & Schmidt, P. (1982). On the estimation of technical inefficiency in the stochastic frontier production function model. Journal of Econometrics, 19(2–3), 233–238. https://doi.org/10.1016/0304-4076(82)90004-5
  12. Kodde, D. A., & Palm, F. C. (1986). Wald Criteria for Jointly Testing Equality and Inequality Restrictions. Econometrica, 54(5), 1243–1248. https://doi.org/10.2307/1912331
  13. Kumbhakar, S., Ghosh, S., & McGuckin, J. T. (1991). A Generalized Production Frontier Approach for Estimating Determinants of Inefficiency in U.S. Dairy Farms. Journal of Business & Economic Statistics, 9(3), 279–286. Retrieved from https://econpapers.repec.org/RePEc:bes:jnlbes:v:9:y:1991:i:3:p:279-86
  14. Kuncoro, M. (2003). Why Manufacturing Industry Persisted to Cluster Spatially in Java. Gadjah Mada International Journal of Business, 5(2), 221–246. https://doi.org/https://doi.org/10.22146/gamaijb.5410
  15. Kuncoro, M. (2013). Economic geography of small and cottage industrial clusters in Java Island Indonesia. Global Advanced Research Journal of Geography and Regional Planning, 2(1), 6–18.
  16. Meeusen, W., & van Den Broeck, J. (1977). Efficiency Estimation from Cobb-Douglas Production Functions with Composed Error. International Economic Review, 18(2), 435–444. https://doi.org/10.2307/2525757
  17. Minangsari, F., Robiani, B., & Mukhlis, M. (2019). The Efficiency of the Pharmaceutical Industry in Indonesia: A Stochastic Frontier Approach. Jurnal Ekonomi Pembangunan, 17(2), 49–58. https://doi.org/10.29259/jep.v17i2.8949
  18. Mohd Noor, Z., & Ismail, R. (2007). Analisis kecekapan teknik dalam industri skel kecil dan sederhana di Malaysia. International Journal of Management Studies (IJMS), 14(1), 199–218.
  19. Mukhlis, Robiani, B., Marwa, T., & Chodijah, R. (2017). Agglomeration of Manufacturing Industrial, Economic Growth, And Interregional Inequality in South Sumatra, Indonesia. International Journal of Economics and Financial Issues, 7(4), 214–224.
  20. Murphy, G. B., Trailer, J. W., & Hill, R. C. (1996). Measuring performance in entrepreneurship research. Journal of Business Research, 36(1), 15–23.
  21. Nurlela. (2015). Analisis Efisiensi dan Produktivtas Usaha Kecil Menengah di Kota Sorong (Kasus Usaha Kripik). Agroforestri, X(3), 247–254.
  22. Pettigrew, A. M. (1992). The character and significance of strategy process research. Strategic Management Journal, 13(S2), 5–16. https://doi.org/10.1002/smj.4250130903
  23. Wajdi, M. F. (2012). Analisis efisiensi industri kecil berdasarkan analisis stochastic frontier. BENEFIT Jurnal Manajemen Dan Bisnis, 16(1), 10–22.
  25. Yuliana, S., Robiani, B., & Mukhlis. (2018). Effect of Investment on Employment in the Formal Small Industries In the District/City of South Sumatra Province, Indonesia. International Journal of Economics and Financial Issues, 8(1), 1–8.

Most read articles by the same author(s)

Similar Articles

1 2 3 4 5 6 7 8 9 10 > >> 

You may also start an advanced similarity search for this article.