The Growth Determinant in the Industrial Sector Featured in East Java Province

• Main Author: Mohtar Rasyid
• Format: Article
• Language: English
• Published: Universitas Negeri Semarang 2016-06-01
• Series: JEJAK: Jurnal Ekonomi dan Kebijakan
• Subjects: small scale industries, input driven, productivity driven, sustainable growth
• Online Access: http://journal.unnes.ac.id/nju/index.php/jejak/article/view/6171

<p class="BasicParagraph"><em>This article aims toanalyzethe main determining factorof growthof industrialsector, especiallythe small scale industriesin East Javaover the past decade. Using theofthe Cobb-Douglas production functionapproach, this research assessedinputfactorconsisting oflabor, capitalandrawmaterials.This study used apooling regression modelto estimate the coefficient of production function fromfourgroups ofselected industries namely:the food industry, textile industry, wood industryandpaperindustry. The results showedthat the sourceof growthfor the industryisstilldominatedbythe physicalgrowth ofinputandnot byproductivity growth. As a result, in the long rungrowth ofthe industry is difficulttobesustainable and relativelyvulnerable toeconomic shocks. Based onthese findingssuggested thatpolicy makersfocus more onefforts toimprove the quality ofinputs, in particularinputqualityhuman resourcesor labor.</em></p><p> </p><p> </p>