Simultaneous Equation of Concentration, Efficiency, and Competitiveness of Indonesia’s CPO Industry: Impacts and Policies

Hidayat, Ariodillah and Robiani, Bernadette and Marwa, Taufiq and Suhel, Suhel and Susetyo, Didik and Mukhlis, Mukhlis and Asngari, Imam (2025) Simultaneous Equation of Concentration, Efficiency, and Competitiveness of Indonesia’s CPO Industry: Impacts and Policies. Economia agro-alimentare/Food Economy-Open Access, 27 (1). pp. 1-42. ISSN 1972-4802

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Abstract

This study simultaneously analyzed the industrial concentration measured using CR4, technical efficiency measured using Stochastic Frontier Analysis (SFA), and competitiveness using the Revealed Comparative Advantage (RCA) approach of the CPO industry in Indonesia. The study uses time series data from 2001 to 2020, sourced from the Central Statistics Agency (BPS), the World Bank, and UN Comtrade. This study uses a simultaneous model approach of Two Stage Least Squares (2SLS). The results show that the effi ciency of the technique has a negative and signifi cant impact on industrial concentration. The market concentration measured by CR4 shows a positive and signifi cant relationship with competitiveness. Large companies that dominate the market are able to create price stability and encourage innovation, which ultimately improves the profi tability and quality of CPO. RSPO policy is negatively correlated with concentration levels, the high cost of certifi cation can be a barrier for new companies to enter the market. Biodiesel policy opens up new opportunities, the push to meet domestic demand can reduce the pressure to innovate.

Item Type: Article
Uncontrolled Keywords: Competitiveness, Concentration, Crude Palm Oil Industrial, Technical Efficiency Simultaneous Equation Model
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD2321-4730.9 Industry
Divisions: 01-Faculty of Economics > 60201-Development Economics (S1)
Depositing User: ariodillah hidayat ario hidayat
Date Deposited: 19 Jun 2025 05:13
Last Modified: 19 Jun 2025 05:13
URI: http://repository.unsri.ac.id/id/eprint/175576

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