Tajidan, Tajidan (2015) Producer surplus as a measure of opportunity cost: A case of corn farming on the hill of Mount Rinjani, Indonesia. Advances in Management & Applied Economics, 3 (5). pp. 37-42. ISSN 1792-7544, 1792-7552
|
Text
L.A.1.b.1.pdf Download (480kB) | Preview |
Abstract
Opportunity Cost is a decision making tool to select a more appropriate alternative for a final decision. The usual measure for opportunity cost is farm profit or income. This paper aims at: (1) introducing producer surplus as a measure for opportunity cost; (2) utilizing producer surplus as a determinant in deciding actions that provide the best benefit for farmers. To achieve the above objectives, a research was conducted on 120 units of corn farming on the hills of Mount Rinjani, i.e. in Bebidas Village and PringgabayaUtara Village. Data were collected through face-to-face interviews guided by a structured questionnaire. The study concludes the followings: (1) Producer surplus can be applied as an alternative measure for opportunity cost; (2) If the farmers are expected to leave the corn farming, they need to gain a compensation of IDR 2 million/ha in order to maintain welfare; (3) Producer surplus can also be used as a measure for opportunity cost for any other farms.
| Item Type: | Article |
|---|---|
| Keywords (Kata Kunci): | producer surplus, opportunity cost, compensation, decision, corn farm |
| Subjects: | H Social Sciences > H Social Sciences (General) |
| Divisions: | Fakultas Pertanian |
| Depositing User: | Prof. Ir. Taslim Sjah, M.App,Sc., Ph.D. |
| Date Deposited: | 22 Sep 2021 06:08 |
| Last Modified: | 22 Sep 2021 06:08 |
| URI: | http://eprints.unram.ac.id/id/eprint/24497 |
Actions (login required)
 |
View Item |
