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Economic Cooperation in Natural Rubber: The Impacts on Natural Rubber's World Supply and Indonesia's Economy

Author

Listed:
  • Kiki Verico

    (Graduate School of Asia - Pacific Studies, Waseda University)

Abstract
In 1999, the International Natural Rubber Agreement (INRA) which had regulated the world’s natural rubber since 1979 collapsed. This paper analyzed the impacts of this international agreement on both the global trade and supply of natural rubber as well as on Indonesia, a major producer of rubber. This study adopted two approaches in its assessment: (1) the Cournot-Nash Equilibrium, which analyzes the "external effects" or the global market conditions for natural rubber before and after the collapse of INRA; and (2) the Input-Output Table Simulation on rubber products, which assesses the "internal effects" or the economic conditions in Indonesia before and after the collapse of INRA.

Suggested Citation

  • Kiki Verico, 2013. "Economic Cooperation in Natural Rubber: The Impacts on Natural Rubber's World Supply and Indonesia's Economy," Asian Journal of Agriculture and Development, Southeast Asian Regional Center for Graduate Study and Research in Agriculture (SEARCA), vol. 10(2), pages 75-93, December.
  • Handle: RePEc:sag:seajad:v:10:y:2013:i:2:p:75-93
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    File URL: https://ajad.searca.org/article?p=351
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    Citations

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    Cited by:

    1. Thomas Kopp & Richard J. Sexton, 2021. "Farmers, Traders, and Processors: Buyer Market Power and Double Marginalization in Indonesia," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(2), pages 543-568, March.
    2. Ali, Muhammad Fadzli & Akber, Md. Ali & Smith, Carl & Aziz, Ammar Abdul, 2021. "The dynamics of rubber production in Malaysia: Potential impacts, challenges and proposed interventions," Forest Policy and Economics, Elsevier, vol. 127(C).
    3. World Bank Group, 2020. "Commodity Markets Outlook, April 2020," World Bank Publications - Books, The World Bank Group, number 33624.
    4. Kopp, Thomas & Dalheimer, Bernhard & Bruemmer, Bernhard & Herlambang, Mirawati Yanita & Alamsyah, Zulkifli, 2018. "Can the South East Asian Rubber Cartel Manipulate International Rubber Prices?," 2018 Annual Meeting, August 5-7, Washington, D.C. 273832, Agricultural and Applied Economics Association.
    5. Ali, Muhammad Fadzli & Sulong, Siti Hawa & Julius, Kotir & Smith, Carl & Aziz, Ammar Abdul, 2022. "Using a participatory system dynamics modelling approach to inform the management of Malaysian rubber production," Agricultural Systems, Elsevier, vol. 202(C).
    6. Kopp, Thomas & Dalheimer, Bernhard & Alamsyah, Zulkifli & Yanita, Mirawati & Brümmer, Bernhard, 2019. "Can the Tripartite Rubber Council manipulate international rubber prices?," EFForTS Discussion Paper Series 30, University of Goettingen, Collaborative Research Centre 990 "EFForTS, Ecological and Socioeconomic Functions of Tropical Lowland Rainforest Transformation Systems (Sumatra, Indonesia)".
    7. Caramugan, Karlo Martin & Bayacag, Purisima, 2016. "Price Bubble in Selected ASEAN Agricultural Exports: An Application of the Generalized Supremum Augmented Dickey Fuller," MPRA Paper 74807, University Library of Munich, Germany.

    More about this item

    Keywords

    oligopoly market; international investment; Cournot-Nash Equilibrium; International Tripartite Rubber Organization;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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