Agribusiness role in Indonesia's economy

The purpose of this study is to analyze:a) the role of the agribusiness sector in the economy through the structure of Gross Added Value, output distribution, income distribution and labor, b) to analyze the output multiplier, income and labors multiplier, and c) to analyze backward and growing linkages of agribusiness sector to other sectors in the Indonesian economy. This research utilises Input Output Analysis to Table I-O Indonesia Updating 2011 based on table of Domestic Transaction of Producer Price in 2011 classification from 66 sectors aggregated into 37 sectors.

The results showed that the agribusiness sector contributed 28.18% to the Gross Added Value. In terms of Output and Income Distributions, agribusiness sector contributed 27.93% and 22.46% respectively to the national economy, while in the labor distribution sector, the agribusiness sector absorbed 43.66% of the labor which was mostly concentrated in the farming system and paddy farming is the highest employer absorber. Furthermore, the agribusiness sector has a value of direct backwardness and indirectly growing number, higher than other sectors of the economy. In the direct linkage to the future, the agribusiness sector has a much lower value than other sectors, but in the indirect linkage in the future, the agribusiness sector has a higher value than other sectors. The distribution power index analysis and the degree of sensitivity show that the agribusiness sector has lower value than other sectors.