Publication:
Productivity Performance in Indonesia's Manufacturing Sector

Simple item page
dc.contributor.authorJavorcik, Beata
dc.contributor.authorFitriani, Fitria
dc.contributor.authorIacovone, Leonardo
dc.contributor.authorVarela, Gonzalo
dc.contributor.authorDuggan, Victor
dc.date.accessioned2017-05-23T15:09:56Z
dc.date.available2017-05-23T15:09:56Z
dc.date.issued2012-09
dc.description.abstractRelying on firm-level data from Statistik Industri this note analyzes the evolution of productivity dynamics of Indonesian firms over the past 20 years (1990-2009). Economy-wide and sectoral productivity changes are decomposed into their two main components: changes due to the evolution of average productivity and changes due to 'allocative efficiency'. This decomposition shows that while during the 20 years both components have increased, the changes in allocative efficiency have been mainly driven by average productivity growth and less by increases in allocative efficiency, even if the latter has also improved during the period under analysis. Interestingly, the note shows that both average Total Factor Productivity (TFP) growth and allocative efficiency improvements are especially driven by a few sectors: electronics, machinery and instruments, and textiles, clothing and footwear. Limited improvements in both allocative efficiency and average TFP have occurred instead in natural-resource-based sectors, sectors characterized by more limited competition and higher rents. This note emphasizes the importance of 'allocative efficiency' for productivity evolution because, in a context where firms are very different in their productivity, it becomes crucial how resources are allocated in the economy. This series of policy notes suggests that regulatory reforms, exposure to foreign competition and access to imported intermediate inputs are important determinants of allocative efficiency. The problem of a 'missing middle' is closely related to that of sub-optimal allocation of resources across firms: a strong feature of Indonesian firm-size distribution. Going further, the note suggests that burdensome regulations and imperfect financial markets are two important causes of this missing middle. To complement the focus on productivity, the note also analyzes firm-level job dynamics and points to the crucial role of 'start-ups' and new companies as a key driver of job creation. This finding suggests that the focus of policymakers on Small and Medium Enterprises (SMEs) may be misplaced and that this focus should start realigning towards supporting more dynamic 'start-ups' rather than SMEs.en
dc.identifierhttp://documents.worldbank.org/curated/en/485831468044119749/Productivity-performance-in-Indonesias-manufacturing-sector
dc.identifier.doi10.1596/26715
dc.identifier.urihttps://hdl.handle.net/10986/26715
dc.languageEnglish
dc.language.isoen_US
dc.publisherWorld Bank, Jakarta
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectADVERSE CONSEQUENCES
dc.subjectADVERSE SELECTION
dc.subjectALLOCATIVE EFFICIENCY
dc.subjectAVERAGE PRODUCTIVITY
dc.subjectBANKS
dc.subjectBARRIERS TO ENTRY
dc.subjectBENCHMARK
dc.subjectBORROWING
dc.subjectBUSINESS ECONOMICS
dc.subjectBUSINESS ENVIRONMENT
dc.subjectBUSINESS INDICATORS
dc.subjectBUSINESSES
dc.subjectCAPITAL MARKETS
dc.subjectCOMMODITY
dc.subjectCOMPETITIVENESS
dc.subjectCONTRACT ENFORCEMENT
dc.subjectCOPYRIGHT
dc.subjectCREDIT RATIONING
dc.subjectDEFAULT RISK
dc.subjectDEVELOPMENT ECONOMICS
dc.subjectECONOMIC THEORY
dc.subjectECONOMICS
dc.subjectECONOMIES OF SCALE
dc.subjectEFFICIENCY IMPROVEMENTS
dc.subjectEMERGING MARKETS
dc.subjectEMPIRICAL EVIDENCE
dc.subjectEMPLOYMENT
dc.subjectEMPLOYMENT CREATION
dc.subjectEMPLOYMENT GROWTH
dc.subjectENTERPRISE SURVEY
dc.subjectENTERPRISE SURVEYS
dc.subjectENTREPRENEURSHIP
dc.subjectEQUIPMENT
dc.subjectEXPORT MARKETS
dc.subjectEXPORTS
dc.subjectFACTOR MARKETS
dc.subjectFINANCIAL CONSTRAINTS
dc.subjectFINANCIAL CRISIS
dc.subjectFINANCIAL INSTITUTIONS
dc.subjectFINANCIAL MARKETS
dc.subjectFINANCIAL SYSTEM
dc.subjectFINANCIAL SYSTEMS
dc.subjectFIXED COSTS
dc.subjectFOREIGN COMPETITION
dc.subjectFOREIGN DIRECT INVESTMENT
dc.subjectGDP
dc.subjectGLOBAL ECONOMY
dc.subjectIMPERFECT INFORMATION
dc.subjectINCOME
dc.subjectINDEX NUMBERS
dc.subjectINDUSTRIAL DEVELOPMENT
dc.subjectINDUSTRIAL STRUCTURE
dc.subjectINDUSTRY PRODUCTIVITY
dc.subjectINFORMATION NETWORKS
dc.subjectINFORMATION SHARING
dc.subjectINNOVATION
dc.subjectINSPECTIONS
dc.subjectINSTITUTION
dc.subjectINSTITUTIONAL DEVELOPMENT
dc.subjectINSTITUTIONAL FRAMEWORK
dc.subjectINTEREST RATE
dc.subjectINTERMEDIATE INPUTS
dc.subjectJOB CREATION
dc.subjectJOINT VENTURES
dc.subjectLABOR REGULATIONS
dc.subjectLAWS
dc.subjectLEGAL PROVISIONS
dc.subjectMANUFACTURING
dc.subjectMARKET FACTORS
dc.subjectMARKET POWER
dc.subjectMARKET SHARE
dc.subjectMARKET SHARES
dc.subjectMEDIUM ENTERPRISES
dc.subjectMETALS
dc.subjectMONITORING COSTS
dc.subjectMONOPOLY
dc.subjectMORAL HAZARD
dc.subjectNATURAL ENDOWMENTS
dc.subjectNATURAL RESOURCE
dc.subjectNEW ENTRANTS
dc.subjectOPEN ECONOMY
dc.subjectOPTIMAL ALLOCATION
dc.subjectOUTPUTS
dc.subjectPERFECT COMPETITION
dc.subjectPOLITICAL ECONOMY
dc.subjectPRIVATE SECTOR
dc.subjectPRODUCERS
dc.subjectPRODUCTION PROCESSES
dc.subjectPRODUCTIVITY GROWTH
dc.subjectPROFITABILITY
dc.subjectPROPERTY RIGHTS
dc.subjectR&D
dc.subjectREGISTRIES
dc.subjectREGULATORY ENVIRONMENT
dc.subjectRENTS
dc.subjectRESULTS
dc.subjectRURAL BANKS
dc.subjectSMALL BUSINESS
dc.subjectSUPPLIERS
dc.subjectTAX RATES
dc.subjectTELECOMMUNICATIONS
dc.subjectTHEORETICAL MODELS
dc.subjectTIME PERIOD
dc.subjectTOTAL FACTOR PRODUCTIVITY
dc.subjectTOTAL FACTOR PRODUCTIVITY GROWTH
dc.subjectTOTAL OUTPUT
dc.subjectTRANSACTION
dc.subjectTRANSACTION COSTS
dc.subjectTRANSPORT
dc.subjectUSES
dc.subjectWAGES
dc.subjectWEALTH
dc.titleProductivity Performance in Indonesia's Manufacturing Sectoren
dc.typePolicy Noteen
dc.typeDocument de politique généralefr
dc.typeDocumento de políticases
dspace.entity.typePublication
okr.crossref.titleProductivity Performance in Indonesia's Manufacturing Sector
okr.date.disclosure2012-09
okr.date.doiregistration2025-05-07T11:15:40.900017Z
okr.doctypeEconomic & Sector Work::Policy Note
okr.doctypeEconomic & Sector Work
okr.docurlhttp://documents.worldbank.org/curated/en/485831468044119749/Productivity-performance-in-Indonesias-manufacturing-sector
okr.guid485831468044119749
okr.identifier.externaldocumentum000333037_20121010013751
okr.identifier.internaldocumentum16814671
okr.identifier.report73126
okr.importedtrue
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/485831468044119749/pdf/731260NWP0Full0C0disclosed010090120.pdfen
okr.region.administrativeEast Asia and Pacific
okr.region.countryIndonesia
okr.topicSocial Protections and Labor::Labor Policies
okr.topicIndustry::General Manufacturing
okr.topicIndustry::Industrial Economics
okr.topicPrivate Sector Development::Business Environment
okr.topicPrivate Sector Development::Enterprise Development & Reform
relation.isAuthorOfPublication734ee1fb-8c6d-5f35-94cf-b5d89ace0d98
relation.isAuthorOfPublication.latestForDiscovery734ee1fb-8c6d-5f35-94cf-b5d89ace0d98
Files
Original bundle
Now showing 1 - 2 of 2
Thumbnail Image
Name:
731260NWP0Full0C0disclosed010090120.pdf
Size:
1021.45 KB
Format:
Adobe Portable Document Format
Download
No Thumbnail Available
Name:
731260NWP0Full0C0disclosed010090120.txt
Size:
96.94 KB
Format:
Plain Text
Download
License bundle
Now showing 1 - 1 of 1
No Thumbnail Available
Name:
license.txt
Size:
1.71 KB
Format:
Plain Text
Description:
Download
Collections
Policy Notes