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Summary: Qualitative and quantitative methods are applied to assess the impact of CIFOR’s political economy research on the Indonesian pulp and paper sector. Key-informant interviews triangulated by trend-series tests suggest important influence through advocacy intermediaries and counterfactuals of slower adoption of improvements. Effects on conservation set-asides, overcapacity, and plantation establishment are estimated to avert loss of 76,000–212,000hectares of natural forest (135,000 under main assumptions). Application of an economic-surplus framework for environmental benefits of forest conservation and avoided implicit wood subsidies finds benefits of US$19 to US$583 million (US$133 million main estimate), compared with US$500,000 of direct research costs. [ABSTRACT FROM AUTHOR]

• We investigate the use of jurisdictional approaches to promoting sustainable palm oil production. • We theorise the intervention pathways through which jurisdictional approaches promote sustainability. • We analyse the effects of implementation contexts for how jurisdictional interventions are combined and sequenced. • We propose contextually adaptive strategies to improve the impact and resilience of jurisdictional approaches. Voluntary systems of sustainable commodity governance have come under intensified criticism for failing to catalyse transformative change beyond directly regulated supply chains. In response, there has been a surge of efforts to 'scale-up' sustainability impacts through governance interventions at landscape and jurisdictional scales. While these ambitious, scaled-up approaches are attracting significant interest, such approaches demand substantial changes to established repertoires of policy interventions and associated understandings of the pathways through which these contribute to sustainability outcomes. Drawing theoretical insights from scholarship on multi-stakeholder sustainability governance together with findings from a qualitative study of jurisdictional governance experiments in the Indonesian palm oil sector, this paper explores how emerging jurisdictional initiatives are promoting change pathways towards more sustainable commodity production, and how the political, environmental governance and economic contexts in which these interventions are implemented influence these pathways. Analysis shows that by integrating a distinctive mix of market and policy-driven interventions, jurisdictional approaches are contributing to three core pathways of change, centred respectively on network and coalition-building, collaborative governance, and resource mobilisation. However, which of these pathways are most influential, how interventions are sequenced and operationalised, and how the pathways interact in shaping change is highly sensitive to varied subnational implementation contexts, with important implications for the impact and resilience of jurisdictional programs. These findings highlight the need for jurisdictional policy interventions to respond flexibly to contextually-variable configurations of actor interests, coalitions and power relations within contested multi-scalar processes of sustainable commodity governance. [ABSTRACT FROM AUTHOR]

Summary This paper investigates the way Geographical Indications (GIs) are implemented by national and local governments in Indonesia and Vietnam. The two States are active at all stages of GI development, from the selection of the products candidates for GI registration to the supervision of the GI implementation. Thanks to the involvement of national experts from public agencies in the establishment of the Codes of Practices (CoP), they are able to push for the substitution of traditional local techniques with “good practices” (i.e., mostly those recommended by research centers worldwide). Thus, they put GIs at the service of agricultural modernization when GIs apply more conventionally to specific products based on traditional know-how. However, the implementation of the CoPs and thus the achievement of this objective of modernization depend on the perceived interest of producers in the whole GI dynamic. Indeed, the cases studied in Indonesia and Vietnam highlight the variable level of participation of local producers in the GI. In the four studied cases, the CoPs are mainly based on expert knowledge which differs from the actual practices of farmers and processors. Moreover, GIs are implemented in order to create or reinforce reputations rather than legally protecting preexisting ones. For these two reasons, producers’ motivation to invest in GI certification is weak, which makes difficult the necessary collective involvement. In both countries, the involvement of local governments in GI construction and management modifies the situation. Thanks to their knowledge of local situations and stakes, they are more likely than national experts to identify the most strategic supply chains at local level, enable participatory approaches in GI construction and facilitate the involvement of local producers in the GI managing group. But if competences have been given to local governments in the Indonesian and Vietnamese legal frameworks, the distribution of roles between central and provincial governments in GIs are not clearly enough specified. The nature and the importance of local public intervention differ from one case to another. Finally, this paper recognizes the legitimacy of State intervention in GI development, at least as long as producers’ awareness of GIs is still low. However, this State intervention should not only let enough space for producers in GI governance, but also design a frame for arousing their interest and adhesion and for facilitating their collective involvement. That may be facilitated by a concrete and clearly established decentralization of competences in national policies. [ABSTRACT FROM AUTHOR]

To what extent do marine-based economic activities influence the onset of violent conflict? Despite ongoing debate over several decades around the relationship between natural resources and violent conflict, little of the relevant research has addressed the marine environment. Based on satellite data in Indonesia, this paper exploited geographical variations in ocean productivity to provide new evidence on the relationship between fisheries and violent conflict. Using a search-by-radius approach, we compiled a sample of 757 cells to represent spatial interactions and spillovers between land-based conflicts and catch landings on the sea. We found that both industrial and non-industrial catches exhibit a statistically significant positive influence on the occurrence of conflict events. Additionally, increased illegal, unreported and unregulated (IUU) catches are more likely than legal catches to cause violent conflict. An increase in fish catches in Indonesian waters fuels conflict of every kind, among which protests and riots are most sensitive to fisheries while fighting and terrorism are least sensitive. Overall, these empirical findings support the hypothesis that increased competition for common-pool resources contributes to the onset of violent conflict. [ABSTRACT FROM AUTHOR]

This paper identifies for the first time, the separate causal impacts of both onsets of, and recoveries from, physical disability on both employment status and hours worked. Using panel data from Indonesia we find that more than half of working age adults in our sample experience a physical disability at least once in four waves over 16 years. Changes in physical functioning have no effect on hours worked among the employed. However, onsets of physical limitations lead to an increase in the probability of leaving employment, while recoveries increase the probability of returning to work. A larger effect is found among self-employed workers compared to salaried workers. Given the rising prevalence of physical limitations with age, physical disability may be a significant barrier to employment for older working age adults in Indonesia. These results overall point towards a need in Indonesia for policies that support maintaining work or returning to work for persons with physical disability. [ABSTRACT FROM AUTHOR]

Summary In this paper, we consider whether it is the gender of the decision maker or the extent of agency that they wield that is crucial to increasing household welfare. This is an important question as development policy is often formed on the basis that placing resources in the hands of women results in greater household welfare. Indonesia provides the ideal opportunity to study this issue because it is home to ethnic groups with very different gender norms from male dominance (the patrilineal Batak) to female dominance (the matrilineal Minangkabau). Using IFLS data for three rounds, we consider the impact of decision-making by the dominant spouse on household expenditure on education. We find that, in Indonesia, when the dominant spouse (male or female) has sole control of decision-making, there is an overall negative impact on education expenditure. This leads us to argue that it is more important to consider the issue of spousal dominance, than to wholly focus on gender. [ABSTRACT FROM AUTHOR]

Summary This paper examines a participatory budgeting process in the city of Surakarta (Solo), Indonesia. Using newly digitized records of the infrastructure spending results from three distinct phases of the process (proposal, prioritization, and implementation), I assess the degree to which the resulting geographical distribution of spending allocations targets the poor. I find a poverty-related bias in the distribution of infrastructure projects funded by the program. While results vary across neighborhoods, on average, sub-units with more poor people receive a smaller percentage of funding than would correspond to their share of the general population. Furthermore, although the implementation stage exhibits significant divergence from the decisions made during the more public proposal and prioritization processes, the small group of elected officials in charge of implementation are not to blame for the bias. I find no evidence that deviations from decisions made during public meetings are based on something other than legitimate technical considerations. Instead, the bias originates in the proposal stage, with the poorest sub-units less likely to submit proposals in the first place. I conclude that the literature would benefit from more studies that look at differences across stages of decision-making within a particular process. Whereas contextual differences across settings may be difficult to change over the short-run, identifying procedural differences and points of vulnerability across a single process can help to diagnose problems which have the potential to actually be resolved by policy-makers. [ABSTRACT FROM AUTHOR]

• We estimated the impact of internet availability on five aspects of female labour market outcomes in Indonesia. • Our study shows that internet availability has a positive, but small, impact on young or low educated women's probability to have a full-time job. • We observe a negative but small effect on women's chance of holding a formal job and a skilled job. • We do not find evidence that this is caused by women being pushed into these jobs. Instead, the majority of jobs that were created by the arrival of internet are unskilled and informal. • The study finds that while positive, internet by itself may not be sufficient to bring about a large and positive benefit on women's labor market outcomes. Greater female labor market participation benefits not only women's empowerment and the well-being of their families, but also the economy as a whole. Yet the labor force participation of women in developing countries is relatively stagnant, even with higher levels of economic development and better educational attainment. Women are also more likely to work in the informal sector and unskilled jobs. The arrival of the internet and the subsequent creation of internet-based jobs may positively affect women's labor market outcomes. In this paper, we examine the effect of internet availability on five dimensions of women's labor market outcomes in Indonesia, focusing on the heterogeneity in the impact of internet availability on female labor market outcomes. We construct a balanced pseudo panel covering all districts in the country for 2008 – 2018. We find that internet availability has a small positive effect on the labor force participation and full-time employment of younger or low-educated women. We find a small negative effect on the likelihood of holding skilled jobs for these groups of women. We also find a small negative effect on job formality. These effects are concentrated among low-educated women. The findings are mainly explained by the kind of internet-based jobs that were created in the country. On balance, we do not find evidence that the internet significantly improves women's labor market outcomes. [ABSTRACT FROM AUTHOR]

Summary This paper takes advantage of the exogenous phasing of the district-level elections in Indonesia to establish an unbiased causal impact of local economic development conditions on outmigration decisions. Does the change in service delivery due to decentralization affect the internal migration, a phenomenon not new to Indonesia and driven by the historic uneven development across the archipelago? Furthermore, because the services are no longer centered in Java and Bali, will the migration to these historically popular provinces change? If yes, to what extent? This discussion is of central importance not only in the Indonesian context – where rising population pressures in Java and Bali provinces are the government’s ultimate challenge – but also in the development literature, where empirical research on such questions is made impossible by the lack of appropriate data and context. Two different datasets, the Indonesian Family Life Survey and the Indonesian Census, are used to conduct the analyses. They provide consistent results. A household in a district that went through election is 19% less likely to be a migrant-sending household. This is true particularly for districts that are in Java and Bali. A household in a district in Java and Bali that went through election is 27% less likely to be a migrant-sending household. [ABSTRACT FROM AUTHOR]

Summary Recent decentralization reforms in low- and middle-income countries have revived a long-standing debate on the benefits and drawbacks of empowering local governments. While some scholars highlight advances in local democratic accountability, others emphasize the dangers of decentralized governance when democratic practices are poorly institutionalized. This paper studies the case of health politics in Indonesian local government to contend that the focus on democratic accountability and good governance may be insufficient to explain major policy outcomes associated with decentralization. I show that the quality of local democracy affects health insurance policy during the first stages of the decentralization process. However, to understand policy trajectories over a longer time frame, relations between politicians at different levels of government become the crucial factor. Using original qualitative and quantitative data from nearly 400 Indonesian districts and provinces, I find that regions in which cooperation between provincial and district authorities has emerged display systematically higher levels of health insurance coverage. I explain why multi-level cooperation improves local policy outcomes, and I show that the positive effect of cooperation does not depend exclusively on patronage networks. These findings contribute to the literature on decentralization and development by showing that policy cooperation across levels of government is crucial for the implementation of complex social policies, and that multi-level cooperation can have beneficial effects even when local democratic institutions are weak. [ABSTRACT FROM AUTHOR]

Summary: The paper reviews the literature on the characteristics and impact of opinion leaders on the diffusion of new knowledge, concluding that there is no clear evidence on whether opinion leaders are more effective if they are similar in socio-economic attributes to the other farmers rather than superior to would-be followers. A multivariate analysis of the changes in integrated pest management knowledge in Indonesia among follower farmers over the period 1991–98 indicates that opinion leaders who are superior to followers, but not excessively so, are more effective in transmitting knowledge. Excessive socio-economic distance is shown to reduce the effectiveness of diffusion. The paper then derives operational implications of the empirical results. [Copyright &y& Elsevier]

Sparked by examples from Bangladesh, Bolivia, Indonesia, and other developing countries, hundreds of microenterprise programs have been started in the United States. Will these US efforts be successful? This paper reviews the evidence and concludes that microenterprise development is much more difficult in the United States than in the developing world. The paper suggests some ways to address the challenges of US microenterprise development. [Copyright &y& Elsevier]

Summary This paper reviews competing theories about the causes of informality in developing countries and uses new data to determine which theory best explains the persistence and scale of Indonesia’s informal sector. Using nationally representative survey data on micro, small, and medium-sized firms, we find that most of Indonesia’s informal firms are very small, micro firms, with less than five employees. These firms pay low wages, are relatively unproductive when compared to large firms, are managed by individuals with low educational attainment, predominantly supply products to local markets, and have not recently attempted to expand their operations. From a small-scale, qualitative survey of firms, we find that many informal firms do not register their businesses either because they have no desire to expand or borrow from formal financial sources, or because they are avoiding taxes. Finally, we evaluate the impact of Indonesia’s one-stop-shops for business registration program, a large-scale program that attempted to reduce registration costs. We find both that the program had no effects on firms’ informality rates, and we also find that it did not reduce the probability that workers were informally employed. Taken together, the evidence suggests that a combination of the rational exit and the dual economy theories best explains why so many firms in Indonesia are informal. [ABSTRACT FROM AUTHOR]

• Implementation of large Chinese projects overseas is uneven, with the dynamic more complex than often portrayed. • Projects are rolled out more expeditiously in host states with a highly centralized political structure and vice versa. • Malaysia's power concentration has facilitated elite consensus and quickened the East Coast Rail Link's rollout. • Indonesia's implementation of the Jakarta-Bandung High Speed Rail has been checked by multiple influential stakeholders. • This paper's findings have important implications for future South-South cooperation in railway development. This paper focuses on two of the most prominent Chinese railway projects in Southeast Asia since the 2013 inception of the Belt and Road Initiative (BRI) – Malaysia's East Coast Rail Link (ECRL) and Indonesia's Jakarta-Bandung High Speed Rail (HSR). Adding non-economic considerations and political contestation between central state organs into Sinha's (2005) framework on central-state/province interactions and their impact on economic development, it argues that the implementation of large, capital-intensive BRI projects is more complex than often portrayed. The ECRL is implemented considerably faster than the HSR primarily because, relative to Indonesia, Malaysia possesses a more centralized political structure. Malaysia's power concentration at two levels – between central and subnational players and amongst central players – has facilitated elite consensus and accelerated the ECRL's rollout. In contrast, Indonesia's decentralization exercise since the late 1990s, both at the spatial level and within the executive arm of the central government, has encouraged plurality of opinions and complicated project implementation. Despite President Joko Widodo's clear intentions to expedite the Jakarta-Bandung HSR, he has been checked by multiple influential stakeholders, resulting in delays. The Indonesians, relative to the Malaysians, appear to have negotiated a somewhat better deal from the Chinese railway consortium. However, these tentative gains are offset by the HSR's slow implementation, which in turn is undergirded by Indonesia's fragmented institutional arrangement. [ABSTRACT FROM AUTHOR]

This paper analyzes the relationship between agency and Indonesian women’s well-being. The existing debate on empowerment mostly focuses on agency’s instrumental value, how agency benefits development and household/women’s welfare. We depart from this debate by considering the intrinsic value of agency for women using the Indonesia Family Life Survey. We measure agency based on the decisions women make within their households. We find the effects of agency are not unambiguously positive. Agency has intrinsic value, seen in its strong relationship to well-being in certain spheres, which is moderated by the ‘burden of responsibility’ that seems to be felt by decision-makers. [ABSTRACT FROM AUTHOR]

This paper examines the political economy of tourism development in islands and uses Gili Trawangan, Indonesia as a case study. A longitudinal study drawing from fieldwork contributes to the discussion of how different types of power shape community development, and how the effects of hosting international tourism play an explicit role. Analysis using Barnett and Duvall’s Taxonomy of Power model reveals the interplay between the types of power over time and its effects on different actors. Results raise questions for Less Developed Countries, and particularly islands, concerning the social costs of using tourism for development. [ABSTRACT FROM AUTHOR]

Summary This paper uses the variations of ethnic diversity between districts in Indonesia to show that diversity leads to lower social capital outcomes. I find that distinguishing between ethnic polarization and fractionalization matters for the results, as polarization has a larger negative effect. The results cannot entirely be attributed to selection on unobservables, and at least part of the relationship should be interpreted as causal. Finally, diversity seems to increase tolerance, despite its negative effect on other social capital variables such as trust, perceived safety, and participation to community activities, and voting in elections. [ABSTRACT FROM AUTHOR]

Summary This paper examines whether education empowers women. We exploit an exogenous variation in education induced by a longer school year in Indonesia in 1978, which fits a fuzzy regression discontinuity design. We find education reduces the number of live births, increases contraceptive use, and promotes reproductive health practices. However, except for a few outcome measures, we do not find evidence that education improves women’s decision-making authority within households, asset ownership, or community participation. These results suggest that, to some extent, education does empower women in middle-income countries like Indonesia. [ABSTRACT FROM AUTHOR]

Summary The implementation of REDD+ requires knowledge of the willingness to accept land use change contracts and its application over large areas. This paper uses primary data from Indonesia to contrast two approaches to the elicitation of the supply curve for carbon: an auction and an analysis of opportunity costs. The analysis shows that there are important differences between the two approaches for a wide range of prices. An analysis of bidding behavior shows that location and individual preferences (time and risk preferences), but not opportunity costs, play a significant role in this decision. The implications for targeting are discussed. [ABSTRACT FROM AUTHOR]

• This paper analyzes the causal impact of blackouts on the performance of micro and small enterprises in developing economies. • Estimates the cost of blackouts in Indonesia. • Finds that blackouts negatively affect average labor productivity. • Shows that installing a captive generator is a common strategy for mitigating the impact of blackouts. • Provides evidence to assist developing countries in prioritizing electricity reliability. The reliability of electricity supply is one of the most pressing challenges faced by many micro and small enterprises (MSEs) in developing countries. MSEs play a pivotal role in generating employment in these countries, yet the productivity of MSEs is relatively low. Little is known about how blackouts affect performance of MSEs. This paper is the first study to estimate the impact of such power blackouts on productivity of manufacturing MSEs and to discuss the role of the government in addressing the problem. We employed a pseudo-panel dataset covering six firm cohorts within 21 regions the Indonesian national electricity company operates in from 2010 to 2015. Our identification strategy firstly involved examining blackouts determinants and then using these determinants as instruments in an instrumental variable (IV) dynamic panel fixed effects estimation while controlling for factors that potentially affected productivity and correlated with blackouts. We found that electricity blackouts reduced average labor productivity and the resultant losses amounted to approximately IDR 71.5 billion (USD 4.91 million) per year in Indonesia. Therefore, it is crucial to improve electricity supply reliability in developing countries. We found that introducing a captive generator as a way to cope with power outages is positively associated with productivity, and that MSEs that have captive generators benefit when the power supply is poor. Our findings will assist policy makers to prioritize addressing power blackouts relative to other constraints MSEs face. [ABSTRACT FROM AUTHOR]

Summary: This paper uses data from the Indonesian manufacturing census in order to uncover the determinants of firm exports over the period 1990–2005. We examine to what extent differences in firm export propensity and intensity are a consequence of firm-level (microeconomic), of place-based (macroeconomic) first- and second-nature geography characteristics, or of a combination of the two. The results indicate that both internal and external factors matter. Second-nature, rather than first-nature, geography makes an important difference. The conditions of a firm’s province and those of neighboring provinces shape firm exports. Agglomeration effects, education, and transport infrastructure endowment play a particularly relevant role in Indonesian firms’ export propensity, while export spillovers increase export intensity. [ABSTRACT FROM AUTHOR]

Summary: The global spread of Islamic finance has transformed the financial systems of many Muslim countries, but analysts know little about the factors that shape individuals’ demand for Islamic finance. This paper examines the socioeconomic origins of consumer demand for Islamic financial products, using original survey data from Indonesia, where a growing Islamic financial market coexists with a large conventional financial system. Modernization and globalization play critical roles in shaping individual use of Islamic financial products. Perhaps surprisingly, there is no evidence that Islamic piety has any systematic effect on consumers’ choice of Islamic versus conventional financial products. [ABSTRACT FROM AUTHOR]

Summary: This paper examines whether the degree of fiscal decentralization in aid-receiving countries matters in explaining aid effectiveness. The decentralization theorem predicts that the devolution of powers should increase aid effectiveness, since local decision-makers are better informed about local needs. Thereby decentralization may also have reverse effects, e.g., through coordination problems, excessive regulation, administrative costs, and local capture. We use panel data for up to 60 countries and find that aid contributes to economic growth in centralized developing economies. Whereas it is less effective or even harmful in decentralized countries. The cases of Indonesia, the Philippines, and Uganda support our findings. Our results imply that donor countries should carefully consider how the two development instruments—foreign aid and decentralization—interact. [ABSTRACT FROM AUTHOR]

Summary: When agricultural commodities in developing countries experience an economic boom, they offer potential pathways out of poverty while creating environmental and social problems. While recent research provides insights into the governance of international supply chains, it provides less analysis of the local production networks creating critical problems. Indonesia is now the world’s largest exporter of crude palm oil. This paper analyses processes of oil palm development in three oil palm districts. It considers how policy models, regime interests, and agribusiness strategies shape local production networks, generate local outcomes, and affect the possibilities of tackling issues associated with this boom. [ABSTRACT FROM AUTHOR]

Summary: There is growing interest in the rural non-farm sector in developing countries as a contributor to economic growth, employment generation, livelihood diversification, and poverty reduction. Access to infrastructure is identified in some studies as a factor that affects non-farm rural employment and income but less attention has been paid to the constraints imposed by poor quality infrastructure. In this paper, we use data from 4,000 households in rural Indonesia to show that the quality of two key types of infrastructure—roads and electricity—affects both employment in and income from non-farm enterprises. It appears that there would be gains from development strategies that improve both the access to and the quality of rural infrastructure. [Copyright &y& Elsevier]

Summary: Transnational alternative agrifood networks (TAAFNs) seek to make food production and trade practices more socially just and environmentally sustainable, and empower producers in the global South. Drawing on fieldwork in Indonesia examining an organic shrimp network, this paper challenges the viability of TAAFNs as an alternative development and trade model. Specifically, I question the extent to which TAAFNs are based on (1) objective and effective governance, (2) partnership, and (3) democracy and morality. This article concludes that producers and consumers need to develop closer and more substantial relations, if TAAFNs are to generate meaningful and lasting development. [Copyright &y& Elsevier]

Summary: This paper examines whether spillovers from foreign direct investment (FDI) make any contribution to productivity growth in the Indonesian chemical and pharmaceutical firms using plant-level panel data. The spillover effects from FDI are analyzed using a stochastic frontier approach and productivity growth is decomposed using a generalized Malmquist output-oriented index. The results show positive productivity spillovers from FDI; higher competition is associated with larger spillovers; and domestic firms with R&D gain more spillover benefits compared to those without R&D. FDI spillovers are found to be positive and significant for technological progress and positive, but not significant, for technical and scale efficiency change. [Copyright &y& Elsevier]

Summary: Recent studies of large-scale “headline” conflicts have excluded consideration of local conflict, in large part due to the absence of representative data at low levels of geographic specification. This paper is a first attempt to correct for that by assessing the incidence, impacts, and patterns of local conflict in Indonesia. We employ a combination of qualitative fieldwork with an exploratory statistical analysis of the 2003 Village Potential Statistics collected by the Bureau of Statistics (Potensi Desa-PODES), which maps conflict across all of Indonesia’s villages/neighborhoods. Violent conflict can be observed throughout the archipelago. The qualitative analysis shows that local conflicts vary in form and impacts across districts, and that local factors are key. The quantitative analysis, which excludes high conflict areas of Indonesia, confirms the importance of economic factors, with positive correlations between violent conflict and poverty, inequality, and variables measuring economic development. Clustering of ethnic groups and ill-defined property rights were also positively associated with violence. [Copyright &y& Elsevier]

Summary: Consumer concerns over the environmental and social conditions of coffee production have led to the proliferation of sustainability codes, certification schemes, and labeling claims in the sector. This paper addresses how the global private regulation of ethical and environmental standards is having several implications for value chain structures and institutions in the smallholder coffee systems of Indonesia. Global private regulation is driving structural changes in modes of farmer organization, trader–farmer relationships, and is resulting in the increased upstream penetration of multinational trading companies into coffee-producing areas across Indonesia. An unintended consequence of these changes in the future may be to increase transaction costs along the value chain and to exert an overall downward pressure on farm-gate prices. [Copyright &y& Elsevier]

Summary: This paper quantifies the local impacts of mechanized logging on forest-dependent communities in Indonesia, before and after decentralization. A conceptual framework incorporates financial, social, enforcement, rent-seeking, and environmental impacts. Using data from 60 communities in East Kalimantan, the empirical results suggest that significantly more households received financial and in-kind benefits after decentralization compared to before. Many communities engaged in self-enforcement activities against firms both before and after decentralization. Post-decentralization, a significantly higher proportion of households perceived community forest ownership. There were few significant differences in perceived environmental impacts. Little evidence exists of a post-decentralization trade-off between environmental and financial contractual provisions. [Copyright &y& Elsevier]

Summary: Critical to the success of community development is the degree to which citizens contribute their resources. The paper develops regression models to examine the effects of household and community characteristics on household contributions of time and money to three types of participatory community development efforts: governance, social welfare, and environmental infrastructure. Households with indicators of lower socio-economic status generally contributed less time and money to community development. Integration into social networks was also a strong predictor of the amount of time a household contributed. Because most of the community development efforts analyzed rely on reciprocity, where participants contribute resources in order to receive benefits, the findings raise doubts about the extent to which these efforts help the poor and socially excluded. [Copyright &y& Elsevier]

Summary: This paper develops a framework for conceptualizing local capacity to address village level livelihood and governance problems. The framework is based on an analysis of asset distribution, combined with an explicit analysis of the links between processes of state formation, state-business linkages and local forms of social capital. The framework is used to discuss findings from recent research on village capacity in rural Indonesia. The discussion suggests that it is possible to link a political, economic approach to rural development with recent conceptualizations of social capital. Such an analysis can illuminate the forms taken by and the effectiveness of village level collective action in ways that either purely political economy or social capital approaches do not. [Copyright &y& Elsevier]

This paper examines whether foreign-owned plants are more productive than locally owned plants and whether the differences in productivity are related to the degree of foreign ownership in Indonesian manufacturing in 1995. The results indicate that foreign-owned plants have higher productivity than locally owned plants. Moreover, after accounting for the age of the plant, the results indicate that wholly foreign-owned plants tend to have higher productivity than other foreign-owned plants and that relatively new foreign-owned plants tend to have relatively low productivity levels. The relationship between the share of foreign ownership and productivity level differs among industries, and in some industries, minority or majority foreign-owned plants have relatively high productivity. [Copyright &y& Elsevier]

In this paper, we investigate how family and community networks affect an individual''s access to credit institutions using new data from the Indonesia Family Life Surveys. Our theoretical framework emphasizes the family and community''s role in providing information, thus lowering the search costs of the borrower and monitoring and enforcement costs for the lender. From our empirical results, community and family networks are important in knowing a place to borrow, as well as for loan approval. Consistent with an information-based explanation of networks, family and community networks have a larger impact on credit awareness of new credit institutions with a lower impact on awareness of established credit sources. Interestingly, we find that women benefit from participating in community networks more than men. There is no evidence that the rich benefit from community networks more than the poor. Our results on the benefits from participation in the community network are robust to the inclusion of community fixed effects. [Copyright &y& Elsevier]

The calorie–income demand elasticity is an important parameter in the development literature and in the policy arena. Yet, there is very little evidence on the extent to which it can be considered as an unchanging parameter or a time-shifting parameter that, for example, changes with the economic conditions faced by households. In this paper I use data from the 1996 and 1999 SUSENAS surveys in Indonesia to examine whether the relationship between income changes and caloric availability has changed and if so, how. Using the same questionnaire, the SUSENAS surveys collect detailed information on more than 200 different food items consumed over the last seven days by 60,000 households at the same point in time in each survey year. I use nonparametric as well as regression methods to examine two important relationships: (a) the relationship between income and total calories; and (2) the relationship between income and calories from cereals and other foods (excluding cereals and root crops). The empirical analysis finds that the income elasticity of the demand for total calories is slightly higher in February 1999 (the crisis year with dramatically different relative prices) compared to its level in February 1996. In addition, the calorie–income elasticity for cereals as a group increases while the calorie–income elasticity for other food items decreases. The latter finding is interpreted as behavior that is consistent with the presence of a binding subsistence constraint. [Copyright &y& Elsevier]

In recent years there has been a tendency to view the seemingly irremediable spread of “illegal” logging in Indonesia in isolation, or as a result of disassociated and premeditated criminal acts. This paper proposes a different view of the problem by discussing the changing dynamics of the “illegal” logging sector in the two districts of Berau, East Kalimantan and Kotawaringin Timur, Central Kalimantan. It suggests that “illegal” logging is not a simple case of criminality, but a complex economic and political system involving multiple stakeholders. Furthermore, “illegal” logging is not a stationary condition that can be effectively dealt with through coercive or repressive measures alone. Rather, it should be viewed as a dynamic and changing system deeply engrained in the realities of rural life in Indonesia. Regional autonomy has also created a supportive environment for the “illegal” logging trade and allowed it to gain resilience. [Copyright &y& Elsevier]

Presents a response on the analysis made by Christopher Beier and Gabriele Ferrazi about the research on the progress of Indonesian decentralization efforts. Basic fronts used in evaluating the paper; Criticisms made on the discussion of institutional matters related to the rating effort of Indonesia; Theoretical base and alternative approach; Conclusion.