Economics Development Analysis Journal 9 (3) (2020)

Economics Development Analysis Journal

http://journal.unnes.ac.id/sju/index.php/edaj

The Livestock Sector Role on The Economy of Central Java

Arrizal Nurdien Fadhilah1

Economics Development Department, Faculty of Economy, Universitas Negeri Semarang

Article Info Abstract
________________ ________________________________________________________________
Hisrtory of Article The purpose of this study is to find out how big the role of the livestock sector on the economy of
Received April 2020 Central Java Province by looking at the contribution of output, demand structure, power of
Accepted June 2020 dispersion, sensitivity of dispersion, output multiplier, and income multiplier. The analytical method
Pusblished August 2020 used in this study is the Input-Output analysis of Central Java Province 2013 Input-Output Table
________________ Classification of 88 Sectors. The results of the study show that the contribution of output produced
by the livestock sector still low compared to the overall output produced in Central Java. The
Keywords: demand structure of livestock sector mostly distributed to other sectors for further production process
Livestock Sector, Input- while output of the poultry sector distributed for direct consumption. Power of dispersion analysis
OutputAnalysis of the livestock sector shows the highest value among the primary sectors while the sensitivity of
__________________ dispersion of livestock sector is still relatively low. Similarly, the multiplier output of livestock sector
is the highest among other primary sectors, but the income multiplier of the livestock sector is still
relatively low. Through input-output analysis, it can be seen the linkages between economic sectors
in more detail and the impacts arising from changes that occur in one sector to other sectors. This
study concludes that the livestock sector is a potential sector to be developed because it has a high
value of the power of dispersion index and multiplier output so the livestocks sector expected to
encourage the growth of other sectors and the economy of Central Java Province as a whole.

© 2020 Universitas Negeri Semarang

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Corresponding author :
ISSN 2252-6560
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E-mail: rizzalnf002@gmail.com

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INTRODUCTION of the region, the reduction of inequality among

residents, regions, and sectors (Suryani, 2013).
Regional economic development is a
One of the sectors with the greatest contribution
process of regional development that involves
to the regional economy is the agricultural sector.
local governments and the private sector working
The agricultural sector is a provider of food
together to manage the resources available in the
resources, industrial raw materials, increasing
are to encourage economic growth and
foreign exchange, and source of income for rural
employment creation in the area (Arsyad, 2010).
communities (Jhingan, 2010). Central Java
The success of economic development carried
Province is one of the regions that still rely on the
out by a region can be seen from the growth of
agricultural sector to support the economy of
the Gross Regional Domestic Product (GRDP)
most people.
Table 1. GRDP of Central Java Province at 2010 Constant Market Price by Industry
(Million Rupiah)
Industry 2016 2017 2018
Agricultur, Forestry, and Fisheries 116,331,116.45 118,450,171.80 121,556,541.24
Food Crops 40,717,120.33 40,338,689.87 40,171,161.35
Horticultural Crops 28,406,239.80 28,888,205.72 30,187,502.70
Plantation Crops 11,688,434.69 11,874,493.66 12,188,219.07
Livestock 21,202,537.74 22,489,922.56 23,828,930.19
Agricultural Services and Hunting 2,426,164.34 2,482,922.56 2,515,466.95
Forestry and Logging 3,823,956.28 4,050,296.81 4,108,281.90
Fishery 8,066,663.27 8,353,130.32 8,556,979.08
GRDP 849,099,354.69 893,750,296.17 941,164,118.17
Source: Central Bureau of Statistics of Central Java Province

The agricultural sector itself consists of sector were the food crops, horticulture, and
several sub-sectors including food crops, livestock sectors. The three sectors contribution
horticultural plants, plantation plants, livestock, has continued to increase each year, but the food
agriculture and hunting services, foresty and crops and horticulture sectors have decreased in
logging wood, and fishery. Among the several contribution over the past three years while the
sub-sectors, there are three sectors with the livestock sector has continued to increase.With
largest contribution in the agricultural sector, that relatively large contribution and increasing every
is food crops, horticultural crops, and livestock. year, the livestock sector is expected to have
Besides, the three sectors grow relatively fast each positive impact on other economic sectors to
year compared to other sectors in the agricultural grow faster.
sector. The large contribution and rapid growth Table 2. Contribution of Food Crops,
of the three sectors are not accompannied by Horticultural Crops, and Livestock on GRDP of
positive influence on other sectors in the Central Java Province 2016-2018 (%)
Industry 2016 2017 2018
agricultural sector. The inequality that occurs in
the agricultural sector shows that the sector with Food Crops 4.79 4.51 4.26
a large contribution will always grow rapidly Horticultural 3.34 3.23 3.20
while the sector with a relatively small Crops
contribution grows slowly and cannot keep up Livestock 2.49 2.51 2.53
with the growth of these large sectors. This Source: Central Bureau of Statistics of Central
certainly has an unfavorable impact on the Java Province
process of economic development. The sectors The livestock sector with contributions
with the biggest contribution to the agriculture that continue to increase every year is expected
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to have an impact on the growth of other sectors, (1997) in Suryani (2013), the system of Input-
but in reality the potential of the livestock sector Output analysis compiled based on the
has not been utilized to the fullest. It can be seen assumption of behavioral economics that is a
that the livestock population in Central Java still simplification of the framework for measuring
below the carrying capacity of livestock. In 2017 the flow of inputs and outputs of the various
livestock population in Central Java was sectors in a certain region. This systems follow
3,330,188 with carrying capacity 4,985,664. With the flow of goods and services from one sector to
a population that is still below the ideal another sectors.
population, the output produced by the livestock To see how big a sector's role in the
sector is not optimal and still has a great potential economy is not only seen through its contribution
to incrase in the future. By using the 2013 Central to the GRDP but also through the production of
Java Province Input-Output Table analysis, it can that sector's output. This analysis is used to see
be seen which sectors are the leading sectors can the contribution of a sector's output to the overall
encourage the growth of other economic sectors output. Outputs are valued at producer prices
so that the economy will grow as a whole. without elements of trade margins and
transportation costs. In the 2013 Central Java
RESEARCH METHODS
Province Input-Output table, the total output
This research is a type of research that uses produced by each economic sector is given a code
a quantitative approach. Quantitative method is (600) and is usually seen as a percent (%).
a science approach to make a managerial Output produced by an economic sector
economics decision. The quantitative approach are used to meet intermediate demand or for
processes the data that has been collected into further production processes and final demand or
useful information for decision makers for direct consumption by the public. The
(Kuncoro, 2011). Quantitative approaches contribution of intermediate demand is obtained
consists of formulating problems, constructing by comparing the number of intermediate
models, collecting data, finding solutions, demand with the total demand for the sector. The
analyzing results, and implementing results. intermediate demand in the Central Java
The data used in this study are secondary, Province Input-Output table is shown by the
which is data that has been collected by data contents along the lines in the intermediate
collection agencies and then published to data transaction that show the allocation of outputs of
users (Kuncoro, 2011). The data used in this one sector in meeting the input needs of other
study are Input-Output Table of Central Java sectors for further production needs.
Province 2013, GRDP of Central Java Province, While the contribution of a sector's final
Statistics of Animal Husbandry and Animal demand can be obtained by comparing the
Health 2018, Statistics of Animal Husbandry of number of final demand with the total sector
Central Java Province. The data used in the study demand. In this study, the final demand consists
are obtained from The Central Bureau of of household consumption expenditure
Statistics of Central Java Province, Directorate components (301), government consumption
General of Animal Husbandry and Animal expenditure (302), fixed capital formation (303),
Health of The Ministry of Agriculture, stock changes (304), and exports (305).
Department of Animal Husbandry and Animal Through buying and selling transactions
Health of Central Java Province. that occur between sectors can be identified
This research uses Input-Output analysis forward and backward linkages of the sector.
to answer the problem in this study. Analysis Forward linkages occur when a sector's output is
Input-Output is a method that systematically used by other sectors for the production process
measures the relationship of various economics and backward linkages occur when a sector uses
sectors in complex economics system (Daryanto inputs that come from the output of another
and Hafizrianda, 2010). According to Nazara sector. To find out the forward linkages of a
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sector can be measured by the sensitivity of selling transactions will ultimately lead to a
dispersion while the backward linkage is multiplier effect. An increase in the final demand
measured through the power of dispersion. of an economic sector that has broad linkages
The forward linkage of an economic sector both backward and forward linkages can create a
can be measured through the sensitivity of multiplier effect in the economy. There are two
dispersion index of the economic sector. multiplier effects used in this study, namely the
Sensitivity of dispersion is the impact that occurs output multiplier and income multiplier.
in an economic sector due to changes in final Output multiplier is the overall output
demand in each economic sector in the region. created in the economy caused by changes in the
While The backward linkage of an economic amount of final demand for an economic sector.
sector can be measured through the power of The output multiplier can be obtained from the
dispersion index. Power of dispersion is the sum of each column of the inverse leontief
impact that occurs due to changes in the final matrix. Whereas, The income multiplier is a
demand that occurs in a sector on output in the change that occurs in household income as a
aggregate. Power of dispersion measures how result of changes in the amount of final demand
much a sector's ability to drive the growth of for an economic sector.
other sectors through the use of output produced
RESULTS AND DISCUSSION
by these sectors as input to the sector concerned.
A sector can be said to have a high power of The contribution of a sector to the
dispersion if the index value of the sector is more economy is not only seen through the
than one (> 1). Conversely, a sector can be said contribution of the sector to the GRDP, but the
to have a low power of dispersion if the value of contribution of a sector can also be seen through
the index is less than one (<1). how much the contribution of the sector in
The linkages between economic sectors providing output.
that interact with each other through buying and

Table 3. Contribution Ouput of Economic Sector in Central Java Province

Output Contribution to Total
Industry Code Ranking
(Million Rupiah) Output (%)
Trade 71 1 162,389,251.71 12.93
Oil Refinery Industry 56 2 127,019,690.83 10.11
Government and Defence 83 3 84,187,532.46 6.70
Livestock 22 68 1,314,2215.42 0.105
Poultry 23 13 27,972,937.02 2.228
Source: Central Java Province Input-Output Table 2013, processed.

The analysis of the contribution of output aims to Dault (2002) entitled Analisis Kontribusi Sektor
provide an overview of which sectors can make a Perikanan Pada Struktur Perekonomian Jawa
large contribution to the economy of Central Tengah which concluded that the livestock sector
Java Province. The output produced by the has a relatively low output contribution of 1.66%.
livestock sector is Rp. 1,314,215.42 Million for The low output produced by the livestock sector
the livestock sector or equal to 0.105% of total is caused by the number of animals that have not
output and Rp. 27,972,937.02 Million for the reached the ideal number. In 2017, the number of
poultry sector or 2,228% of total output. Output livestock in Central Java was 3,330,188 Animal
produced by the livestock sector is still low and Units, whereas for the ideal number of 4,985,664,
ranks only 68 for the livestock sector and rank 13 the livestock population in Central Java still
for the poultry sector. The results of this study needed to be increased by 1,655,476 ST. With the
indicate conformity with previous research by
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addition of cattle, it is expected to have an impact sector. The provision of quality feed (Good
on increasing the output of the livestock sector. Feeding Practice) such as forages and
Besides the number of animals that are still below concentrates, good breeds (Good Breeding
the ideal number as mentioned above, the Practice), vaccines, and quality livestock
traditional pattern of breeding is also the cause of medicine will have an impact on livestock
the inadequate production of livestock sector productivity in Central Java. So that the
output. Most of the people of Central Java still development of sectors that produce inputs for
make the livestock sector as a side business and the livestock sector will have an impact on
have not become a main business so that the increasing livestock production in Central Java.
maintenance pattern becomes inefficient. The In addition to the upstream sector, the
community is expected to change livestock development of output-based sectors of the
raising patterns to become more modern by livestock sector will also have an impact on
applying good farming practices so that the increasing output generated by the livestock
output produced by the livestock sector will be of sector. The development of the processing
better quality, safer, and suitable for industry based on the output of the livestock
consumption. That way, the maintenance sector will cause the demand for the output of the
process will be more efficient and have an impact livestock sector to increase, so that the
on increasing the output of the livestock sector. production of livestock products also increases.
Increasing production output of the livestock Output produced by an economic sector is used
sector not only focuses on increasing the number to fulfill the intermediate demand where the
of livestock and applying modern maintenance sector’s output is used as raw material for
processes, but also must pay attention to the production purpose and the final demand where
upstream and downstream sectors that are the sector’s output is used for direct consumption
directly or indirectly related to the livestock by community

Table 4. Demand Structure of Livestock Sector

Industry Code Intermediate Final Demand Total Demand
Demand
Livestock 22 970,235.33 343,980.09 1,314,215.42
Poultry 23 2,743,547.93 25,229,389.09 27,972,937.02
Source: Central Java Province Input-Output Table 2013, processed.

Based on the analysis of intermediate distributed to other economic sectors for further
and final demand structure analysis, most of the production processes. 73.83% of the sector's
output produced by the livestock sector are output is used to meet intermediate demand.

Table 5.Intermediate Demand of Livestock Sector (Million Rupiah)

Industry Code Intermediate Demand %
Paddy 1 411,643.97 42.43
Food Processing and Preservation 32 155,370.23 16.01
Industry
Corn 2 85,185.97 8.78
Fruits 8 71,962.99 7.42
Vegetables 6 41,202.76 4.25
Intermediate Demand of Livestick Sector 970,235.33
Source: Central Java Province Input-Output Table 2013, processed.

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Total intermediate demand the most widely used as input by the hospitality
livestock sectors is Rp. 970,235.33 Million, most services sector is 69.68%. Followed by the
widely used by the paddy sector is 42.43% poultry sector itself which amounted to 6.36%,
which shows that the paddy sector uses the most this shows that most of the output produced by
output from the livestock sector as input in the poultry sector are still widely used as input to
theproduction process. It can be concluded that the sector itself. Just like the livestock sector,
the paddy sector is a sector that has a large changes in the use of output coming from the
influence on changes in output produced by the poultry sector by the hospitality service sector
livestock sector. When there is a change in the and the poultry sector itself will have a major
amount of input used by the rice sector effect on the output production of the poultry
originating from the livestock sector will have a sector. Or it can be said that the development of
major effect on the output of the livestock sector the poultry sector are very dependent on the
and its results because most of the output hospitality service sector and the sector itself.
produced by this sector is used for input in the This indicates that the processing industry based
rice sector. on output of the poultry sector have not yet
The low output of the livestock sector developed so that the output produced is more
that are directly consumed by the community distributed for direct consumption. Although it
such as beef, meat, goats, and milk are caused by possesses perishable characteristics, because the
relatively high prices so that the output produced price of chicken meat, duck meat, and eggs is
by this sector is more distributed to other sectors relatively cheaper so it is more sought after by the
for reprocessing. In addition, the characteristics community as a daily source of protein.
of perishable livestock products are also one of This is consistent with the general
the reasons why most of the output produced by equilibrium theory proposed by Leon Walras,
this sector must undergo further processing. explaining that each economic sector is
interconnected through buying and selling
Table 6. Intermediate Demand of Poultry Sector transactions. The output of one sector is sold to
(Million Rupiah) other sectors and to meet the final demand. The
Intermediate livestock sector as one of the primary sectors
Industry Code %
Demand plays a role in providing raw materials such as
Hospitality 73 1,911,618.16 69.68 meat, milk, eggs, bones, blood, fertilizer, skin,
Services and fur to the manufacturing sector, especially
Poultry 23 174,534.58 6.36
Restaurant 72 155,953.64 5.68 industries based on the output of the livestock
Services sector. The greater the production of industrial
Bread and 36 103,565.89 3.77 sector will have an impact on increasing output
Pastry produced by the livestock sector. In addition,
Industry
inputs used by the livestock sector also come
Fruits 8 86,915.20 3.17
from other economic sectors such as animal feed,
Intermediate 2,743,547.93
Demand of Poultry seeds, vaccines, drugs, and livestock machinery
Sector produced by other sectors. Interaction between
Source: Central Java Province Input-Output sectors of the economy through buying and
Table 2013, processed. selling will bring the economy towards a general
equilibrium.
While the output produced by the poultry Through buying and selling transactions
sector are more widely distributed for direct that occur between economic sectors, it can be
consumption by the community. 90.20% of the seen the relationship of one sector to another
sector's output is used to meet final demand. The sector. The linkages of an economic sector can be
total of intermediate demand of this sector is Rp. divided into forward and backward linkages. To
2,743,547.93 Million as shown in table 6, the measure the forward and backward linkages of an
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economic sector, an analysis of the sensitivity of Because the output produced by the livestock
dispersion and power of dispersion can be used. sector is not absorbed much by the processing
Sensitivity of dispersion shows the ability industry and is consumed more directly by the
of one sector to stimulate the production of other community causing a short link in the future of
sectors that use the output of this sector as input. the livestock sector.
Power of dispersion is a measurement
Table 7. Sensitifity of Dispersion Index used to see the backward linkages of an economic
Sensitifity sector. Through this analysis, can be seen which
of sectors can drive the growth of other sectors by
Industry Code Ranking
Dispersion using the input produced by those sectors.
Index
Trade 71 1 4.6942 Table 8. Power of Dispersion Index
Oil Refinery 56 2 3.9770 Power of
Industry Industry Code Ranking Dispersion
Index
Road 75 3 1.9719
Rice 34 1 1.4145
Transport Milling
Services Industry
Livestock 22 46 0.8262 Bread 36 2 1.4102
Poultry 23 38 0.8479 and
Pastry
Source: Central Java Province Input-Output
Industry
Table 2013, processed. Food 39 3 1.3881
Spices
The sensitivity of dispersion of a sector is and
a measure to see the forward linkages produced Flavoring
Industry
by an economic sector. The sensitivity of
Livestock 22 37 1.0241
dispersion index looks at the ability of one sector Poultry 23 26 1.1406
to stimulate the production of other sectors that Source: Central Java Province Input-Output
use the output of this sector as input. The index Table 2013, processed.
value of the sensitivity of dispersion of the
livestock sector is still low or less than one (<1). The livestock sector has the highest power
This result is supported by previous research of dispersion index among other primary sectors.
conducted by Septiadi (2017) entitled Analisis This is supported by Rafiqah's study (2018)
Daya Penyebaran dan Derajat Kepekaan Sektor entitled Daya Penyebaran dan Derajat Kepekaan
Ekonomi di Jawa Tengah which concluded that the Sektor Pertanian dalam Pembangunan Ekonomi di
livestock sector has an power of dispersion index Provinsi Jawa Tengah which concluded that the
above average (> 1) while the sensitivity of livestock sector has a power of dispersion index
dispersion index of the livestock sector is less of above the overall index average and is the highest
one (<1). The sensitivity of dispersion index in the agricultural sector. The high value of
value which is still relatively low is caused power of dispersion index shows that the
because most of the output produced by the livestock sector can drive the growth of overall
livestock sector is directly consumed and not to output production because the livestock sector
be reprocessed by other sectors so that the has a close backward linkage with many sectors.
livestock sector has a short forward linkage. This Increased output production from the livestock
short linkage is caused by the output-based sector will result in inputs from other sectors will
industry of the livestock sector which is still also increase.
underdeveloped so that the output of the The livestock sector have a power of
livestock sector is more widely distributed to dispersion index value of 1.0241, this value is
meet direct consumption by the community.
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above the average (> 1) of other economic sectors that is continuous, so that the improvement in the
so that an increase in final demand in this sector quality of output produced by the other four
will have an impact on increasing output in other sectors will have a positive impact namely an
economic sectors that provide input to the increase in the output of the livestock sector both
livestock sector. in quantity and quality.

Table 9. Intermediate Input Structure of Table 10.Intermediate Input Structure of

Livestock Sector (Miliion Rupiahs) Poultry Sector (Miliion Rupiahs)
Industry Code Intermediate Percentage Industry Code Intermediate Percentage
Input (%) Input (%)
Animal 40 144,181.52 37.34 Animal 40 6,689,205.37 64.83
Food Food
Industry Industry
Trade 71 78,184.53 20.25 Trade 71 2,061,069.11 19.98
Paddy 1 31,817.82 8.24 Road 75 429,474.60 4.16
Road 75 20,075.48 5.20 Transport
Transport Services
Services Pharmaceuti 54 291,055.58 2.82
Oil and 33 12,768.65 3.31 cal Industry
Fat and
Industry Traditional
Total Intermediate 386,179.41 Herbal
Input of Livestock Medicine
Sector Poultry 23 174,534.58 1.69
Source: Central Java Province Input-Output Total Intermediate Input 10,317,321.
Table 2013, processed. of Poultry Sector 50

Table 9 shows the five sectors with the Source: Central Java Province Input-Output
largest contribution in providing inputs to the Table 2013, processed.
livestock sector, so that when there is an increase
in final demand in this sector will have the The poultry sector has a power of
greatest impact on these five sectors because dispersion index value of 1.1406, this value is the
these sectors provide the most input compared to largest among other primary sectors. With a high
other economic sectors. The sector which plays power of dispersion index value indicates that the
the role of providing the most inputs to the poultry sector has the higest backward linkages
livestock sector is the animal feed industry. with other economic sectors and changes in the
Followed by the trade sector, paddy, road final demand of this sector can cause the greatest
transport services, and the oil and fat industry. increase in output for sectors that provide input
The output of these sectors will increase as a to the poultry sector. There are five sectors with
result of an increase in livestock sector output the largest contribution to providing inputs for
caused by changes in final demand. The the poultry sector with the biggest contribution is
development of sectors that provide input to the the animal food industry sector in the form of
livestock sector will lead to an increase in output animal feed. Followed by the trade sector in the
of the livestock sector output, therefore an form of trade margins, road transport services in
increase in the quality of feed produced by the the form of transportation costs, the
animal feed industry such as concentrates that are pharmaceutical industry and herbal medicine in
in accordance with the Indonesian National the form of drugs and vaccines, and the poultry
Standard (SNI) and the availability of forage feed sector itself in the form of seeds. Almost the same
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as the livestock sector, but the poultry sector use sectors or potential sectors in the area so that the
a lot of inputs generated by the sector itself. It can development process will proceed more quickly
be concluded that the development of the poultry and can encourage growth other sectors.
sector is still strongly influenced by the sector Investments made in leading sectors or potential
itself, in addition to this it also illustrates that sectors will have a positive impact on other
support from economic sectors is still low. economic sectors and will slowly bring the
Although it has broad backward links, the links economy toward balance. By determining which
with these sectors can be said to be low and are sectors are the leading sectors and potential
still dominated by certain sectors. sectors that have the most backward and forward
To determine the priority sectors in linkages will have an impact on other economic
Central Java, can be seen from power of sectors.
dispersion index and sensitivity of dispersion Through the interrelationships
index. The criteria for determining priority generated by each economic sector, the changes
sectors can be seen in the table below. that occur in one sector will have an impact on
other economic sectors that are directly or
Table 11. Criteria of Priority Sector indirectly related. chain impacts that arise are
Sensitivity usually called the multiplier effect. In the
Power of
of production process, the livestock sector requires
Dispersion Priority
Dispersion inputs from other sectors so that an increase in
Index
Index final demand in the livestock sector will cause an
High (>1) High (>1) I (Leading Sector) increase in demand for inputs such as feed, an
High (>1) Low (<1) II (Potential increase in demand for feed will cause an
Sector) increase in demand for rice and corn and so on.
Low (<1) High (>1) III (Developing The effect arising from a series of increased
Sector) demand for sectors related to the agriculture
Low (<1) Low (<1) IV sector is called the multiplier effect. So that the
(Underdeveloped development of the livestock sector will create a
Sector) chain effect and will ultimately cause the
Source: Widodo (2006) economy to grow as a whole.

The livestock sector with a power of Table 12. Output Multiplier

dispersion index value more than one (> 1) and a Output
Industry Code Ranking
sensitivity of dispersion index value of less than Multiplier
one (<1) can be categorized as a potential sector Rice Milling 34 1 2.00262
to be developed. Among the sectors included in Industry
other primary sectors, only the livestock sector is Bread and 36 2 1.99655
included in priority II or potential sectors while Pastry
other sectors are included in priority III and Industry
priority IV. This shows that the livestock sector Food Spices 39 3 1.96528
must be developed in order to encourage the and Flavoring
growth of other sectors in the agricultural sector Industry
so that imbalances that occur in the agricultural Livestock 22 37 1.44993
sector can be overcome. The determination of Poultry 23 26 1.61480
priority sectors in Central Java Province is in Source: Central Java Province Input-Output
accordance with the theory of unbalanced Table 2013, processed.
development strategy proposed by Hirschman
and Streeten, which explains that investment Output multiplier is the overall output
must be carried out in sectors that are leading produced by the economy as a result of a change
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in one unit of money in the final demand of an amounting to 1.00289, which means that due to
economic sector. The livestock sector has the an increase in the final demand of the livestock
highest output multiplier value among other sector and the results of one unit of money will
primary sectors. This is supported by research create additional output in the livestock sector
conducted by Oktavia (2016) entitled Peran Sektor itself amounting to 1,00289 units of money.
Pertanian dalam Pembangunan Ekonomi di Provinsi Followed by the animal food industry sector by
Jawa Timur (Pendekatan Input-Output) which 0.11132, the trade sector by 0.08331, the corn
concluded that livestock commodities have the sector by 0.03489, and finally the paddy sector by
highest output multiplier value among other 0.03250. These sectors are the sectors with the
economic sectors. The output multiplier greatest changes in output due to changes in the
produced by the livestock sector is the highest final demand of the livestock sector when
among the other primary sectors. The livestock compared to other economic sectors. The
sector has an output multiplier of 1.44993. development of the livestock sector will have the
greatest impact on these sectors which causes the
Table 13. Output Multiplier of Livestock Sector demand for raw materials or inputs from these
Changing sectors to increase and ultimately will encourage
Industry Code
in Output these sectors to participate in growth as the
Livestock 22 1.00289 livestock sector grows itself.
Animal Food 40 0.11132
Whereas the poultry sector has an output
Industry
Trade 71 0.08331 multiplier of 1.61480. The high value of
Corn 2 0.03489 multiplier output from the poultry sector is
Paddy 1 0.03250 inseparable from the influence of the power of
Source: Central Java Province Input-Output dispersion index of the poultry sector as well.
Table 2013, processed.
Table 14. Output Multiplier of Poultry Sector
The livestock sector has an output Changing
Industry Code
multiplier of 1.44993. This shows changes in in Output
output that occur in the entire economy due to Poultry 23 1.00649
changes in the final demand of livestock sector. Animal Food Industry 40 0.24268
Trade 71 0.11518
To find out changes in output that occur in each
Corn 2 0.06105
sector of the economy can be seen through each Road Transport 75 0.02803
column in the reverse matrix leontief. By looking Services
at changes in output that occur due to changes in Source: Central Java Province Input-Output
the final demand of the livestock sector, it can be Table 2013, processed.
seen which sectors are most sensitive to these
changes. Although the value of the power of The poultry sector has a higher multiplier
dispersion index has explained which sectors output value than the livestock sector equal to
contribute greatly to the supply of this sector's 1.61480. This value is a change in overall output,
input, how much is the change in the output of for changes in output that occur in each sector of
these sectors due to changes in the final demand the economy is not much different from the
of the livestock sector is not yet known. Through livestock sector. For the sector with the largest
this multiplier output analysis it can be seen change in output caused by changes in the final
which sectors are most affected due to changes in demand for the poultry sector is the poultry sector
the final demand of a sector. Table 13 shows the itself by 1,00649, it means that due to changes in
five economic sectors with the largest changes in the final demand for the poultry sector of one unit
output due to changes in the final demand of the of money will result changes in output in the
livestock sector. The first sector with the highest poultry sector itself by 1,00649 money units.
additional output is the livestock sector itself, Followed by the animal food industry sector by
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0.24268, the trade sector by 0.11518, the corn value in the primary sector has not been able to
sector by 0.06105, and the last is the road encourage increased household income.
transport service sector by 0.02803. These sectors Domanski and Gwosdz (2010) suggested that the
are the sectors most affected due to changes in the multiplier effect in the economic field can be seen
final demand of the poultry sector, so that the through an increase in GRDP, community
growth of these sectors will grow in tandem with income, and job creation.
the poultry sector.
Table 15. Income Multiplier
Tarigan (2002) states that the multiplier
effect occurs when an economic sector Income
Industry Code Ranking
Multiplier
experiences an increase in demand from outside
the region due to inter-sectoral linkages, resulting Government 83 1 0.59480
and Defence
in other sectors also increasing production so that
in the end the outupt production will increase Private 84 2 0.50952
several times compared to an increase in demand Education
from one of these economic sectors. In the Services
production process, the livestock sector requires
Rubber 12 3 0.40818
inputs from other sectors so that an increase in
Livestock 22 35 0.22528
final demand in the livestock sector will lead to
Poultry 23 6 0.32304
increased demand for inputs such as feed,
increased demand for feed will lead to increased Source: Central Java Province Input-Output
demand for paddy and corn and so on. The effect Table 2013, processed.
arising from a series of increased demand for
sectors related to the livestock sector is referred to The increase in output production
as a clustering effect or here referred to as output caused by an increase in the final demand for the
multiplier. So that the development of the livestock sector led to an increase in household
livestock sector will cause the economy to grow income by 0.22528 for the livestock sector and
as a whole. In addition to resulting in an increase 0.32304 for the poultry sector. The increase in
in the output production in the livestock sector household income that occurred was not so large
and other related sectors, the chain effect caused which showed an increase in output from the
by an increase in the final demand of the livestock livestock sector was not followed by demand for
sector will cause an increase in demand for labor. labor in the sector and other related sectors, so
The increase in overall production volume will that an increase in output in this sector did not
cause greater production activities and require have a major impact on increasing household
more labor. Considering that there are still many income. This is slightly different from the
people who depend on the livestock sector as a research conducted by Putra Putra, Dody Yuli
livelihood, especially in rural areas, an increase (2011) entitled Peran Sektor Perikanan dalam
in the final demand in this sector will cause an Perekonomian dan Penyerapan Tenaga Kerja di
increase in the demand for labor, which in Indonesia: Analisis Input-Output which concluded
remuneration received by workers will also that the livestock sector and its results have a
increase. multiplier income value of 0.28141 and is the
Increasing the amount of remuneration in largest among other primary sectors. This is
this case is wages, resulting in community caused by differences in research locations and
income will increase or often referred to as different sector aggregations.
income multipliers.The income multiplier shows
changed in the amount of money received by CONCLUSION
households caused by a change in the final Based on the results of the study showed
demand of an economic sector by one unit. The that the contribution output of livestock sector is
livestock sector with the highest output multiplier still relatively small compared to total output
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 Arrizal Nurdien Fadhilah/ Economics Development Analysis Journal 9 (3) (2020)

produced in Central Java. This is because the Daryanto, Arief., & Hafizrianda, Yundy. (2010). Input-
livestock population is under the ideal amount of Output Analysis and Social Accounting
Matrix for Regional Economic Development.
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livestock and poultry sectors have the highest
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the sensitivity of dispersion of livestock and pp. 27-37.
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Rafiqah, Imas W., Darsono., & Sutrisno, J. (2018).
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