Impact of Application of Geoisolator in Saltworks Business in East Java Province: A Propensity-Score Matching Approach

Aminah Happy Moninthofa Ariyani, . Harianto, . Suharno, Yusman Syaukat

Abstract


 High quantity and high quality of salt are needed by the industrial sector in Indonesia, but the salt that is produced by farmers still has low quality. The application of geoisolator can increase the quantity and quality of salt produced by farmers. This study aims to analyze the impact of the application of geoisolator on productivity, selling prices, income, fixed costs, and variable costs of saltworks business in East Java Province. The study was conducted at the salt production center in Madura. The farmer survey was conducted in August-September 2018. Retrieval of respondents amounted to 190 respondents consisting of 131 geoisolator farmers and 59 traditional farmers. This study estimates the impact of applying a geoisolator using the Propensity Score Matching (PSM) technique. The results show that the application of geoisolator had an impact on increasing productivity, selling prices, income, and fixed costs, but lowering the variable costs of saltworks business. The government needs to provide investment credit for the purchase of geoisolator so that the goal of increasing production, competitiveness, and welfare of salt farmers can be achieved.

 


Keywords


salt production, income, price, fixed cost, salt

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