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Land-use dynamics, economic development, and institutional change in rural communities - Evidence from the Indonesian oil palm sector

dc.contributor.advisorQaim, Matin Prof. Dr.
dc.contributor.authorGatto, Marcel
dc.date.accessioned2015-02-26T10:20:25Z
dc.date.available2015-02-26T10:20:25Z
dc.date.issued2015-02-26
dc.identifier.urihttp://hdl.handle.net/11858/00-1735-0000-0022-5DD5-8
dc.identifier.urihttp://dx.doi.org/10.53846/goediss-4949
dc.language.isoengde
dc.rights.urihttp://creativecommons.org/licenses/by-nc-nd/3.0/
dc.subject.ddc630de
dc.titleLand-use dynamics, economic development, and institutional change in rural communities - Evidence from the Indonesian oil palm sectorde
dc.typedoctoralThesisde
dc.contributor.refereeQaim, Matin Prof. Dr.
dc.date.examination2015-02-02
dc.description.abstractengThis dissertation is an empirical investigation of the implications of the Indonesian oil palm sector for rural village communities located in Jambi province, on the island of Sumatra. It consists of three contributions to the scientific literature on land-use dynamics, economic development, and institutional change. In Chapter 1, I introduce the reader to the general topic of this research and give a brief overview of the development of the Indonesian oil palm sector, embedded in a historical context. I further outline how this study contributes to the existing literature and present the overall research objectives that will be addressed in the subsequent individual chapters. Specifically, this study examines land-use dynamics and attempts to explain land-use by various determinants at the village level (Chapter 2); it analyzes factors predicting the inclusion of village communities into the oil palm sector and evaluates the effects of market integration on economic development at the village level; finally, it explores the effects of market integration on village institutions (Chapter 4). In Chapter 2, I examine land-use dynamics at the village level of three major land-use systems: oil palm, rubber, and forest. The dynamics are analyzed by looking at land-use over time. In particular, I am interested in explaining village-level land-use in 2002 and 2012 by several lagged land-use systems as well as socioeconomic and policy variables. Econometrically, a seemingly unrelated regression model is applied which accommodates a simultaneous estimation of various equations and accounts for the likely correlation of the land-use equations. I find that in spite of significant oil palm expansion, rubber remains the dominant crop. The data also suggest that oil palm has not been a major driver of deforestation but indirect effects are possible since oil palm expands in areas with ongoing logging activities. Regarding socioeconomic and policy factors, especially a relocation program seemed to be instrumental to the oil palm development. In Chapter 3, I investigate the factors that determine the inclusion of villages into the oil palm sector through contract farming schemes and evaluate the impact of this form of market integration on economic development. Since the adoption of contract farming arrangements is conditional on an investor who visits a village to propose a contract, I investigate contract adoption as a two-step model. In particular, I employ a bivariate model with selection. This allows me to estimate the impact of various factors on the probability of contract adoption by accounting for the factors that predict the probability of investor visit. At the same time, I can account for a possible selection bias. To identify the model, a topographic measure is used as an instrument. I find evidence that, conditional on being visited by an investor, no access to electricity at the village level was the only significant factor predicting the adoption of contract farming schemes. Overall, it appears that, at the village level, contract farming schemes have not been entirely equally accessible; however, I do not find evidence that the rural poor were excluded either. Furthermore, to examine the effects of market integration on economic development at the village level I use village wealth that is based on shares of households owning various assets as a proxy. A recall dataset is used to analyze wealth effects over time, in particular between 2002 and 2012. The estimation exercise reveals that villages in which a contract was signed have a higher wealth index compared with villages in which no contract was adopted. Moreover, larger groups of farmers under contract are associated with higher levels of village wealth. I also find a time effect: the wealth index is higher in villages that signed a contract earlier than those which did so more recently. In Chapter 4, I explore the effects of increased formalized market integration on village institutions. Specifically, I want to understand how contract farming schemes, that introduce institutional changes towards more formalized and anonymous business relationships, affect generalized trust preferences at the village level. In using both survey data and behavioral data elicited through an experiment, I show that villages in which a contract was signed exhibit larger aggregated trust preferences, compared with villages where no contract was signed. This is due likely to a change in village institutions induced by the emergence of formalized relationships between contract farmers and anonymous business actors. Further analysis at the individual level reveals that market integration of villages has a positive effect on generalized trust preferences for all village inhabitants, contracted or not. Possibly, apart from contract participation increased investments in transportation and market infrastructure also increased the integration of non-contract villagers into more formalized and anonymous markets. In Chapter 5, I conclude by summarizing the overall study and by stressing the key findings. I further present some derived policy recommendations and state the limitations of this study along with avenues for future research.de
dc.contributor.coRefereeWollni, Meike Prof. Dr.
dc.contributor.thirdRefereeMußhoff, Oliver Prof. Dr.
dc.subject.engeconomic developmentde
dc.subject.england use changede
dc.subject.enginstitutionsde
dc.subject.engoil palm sectorde
dc.subject.engIndonesiade
dc.subject.engcontract farmingde
dc.subject.engadoptionde
dc.identifier.urnurn:nbn:de:gbv:7-11858/00-1735-0000-0022-5DD5-8-2
dc.affiliation.instituteFakultät für Agrarwissenschaftende
dc.subject.gokfullLand- und Forstwirtschaft (PPN621302791)de
dc.identifier.ppn819037842


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