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I.
INTRODUCTION
I.1. Background
Every region has several goals to be achieved in running governance every
period. This goals is vary depend on every program that assigned in first period of
governance. Among all goals that assigned, economic goal has become one important
goals that need to be achived. It because economic activity become important role that
cover of many people lives.
Economic goals that need to be achieved by every region may vary. But there
are several goals that we can see in every region or even in a country. There are major
three goals that usually become an important indicator of governments success. Those
goals are stability price, low rate of unemployment, and high rate of economic growth.
When this goals achieved it can be one success indicator for all government.
Among three goals that mentioned before, all goals cannot achieved together or
we can said that those goals are trade-off. Governemnt usually focused on one or two
goals to make economic condition within a region running well. The successful
economic condition in a region can showed by many indicator. The most frequently
indicator used and the most easy calculated indicator is economic growth.
Economic growth can be seen from percentage change in Gross Domestic
Product (GDP) from one period to another period. According Prishardoyo (2008) from
Setiawan (2014), a process speed economic growth in the region show by using the rate
of increase of GDP (Gross Domestic Product), so that the level of GDP per capita
growth in the community is often achieved as a measure of success of a region in
achieving the goal of creating development economy.
Development economy can be achieved by every government in region by
planning their economic activity and distributed it well. Every planning must be
suitable for characteristics and potention in every region. Because all region have
different characteristics and potention so it is an assignment for every government to
make regulation that suitable for their region and can develop every potention that exist.
And the last, from developing every potention it will bring economic development in
every region.
From this explanation, writer use Kota Surabaya as research object with several
consideration. Kota Surabaya as capital city of East Java have big contribution in
economic activity in Java. East Java is second highest contributor of GDP in Java Island
after DKI Jakarta (see appendix 1). This result is unpredictable since Kota Surabaya has
very little precentage of agricultural sector compared with other region. This research
conducted to see which sector that become base sector in Kota Surabaya.
I.2. Formulation of Problem
Based on the description above, there are several problems that can identified
formulation of problem as follows:
I.2.1. Is there any changes in the economic structure of Kota Surabaya in the year
2010-2013?
I.2.2. Which sector that become base sector and non base sector in Kota Surabaya
year 2010-2013?
I.3. Research Purpoes
Based on the formulation of the problem described above, then we got
objectives of this study are as follows:
I.3.1. To examine whether there are change in the economic structure of Kota
Surabaya in the year 2010-2013.
I.3.2. To understanding which sector that become base sector and non base sector
in Kota Surabaya year 2010-2013.
II.
LITERATURE REVIEW
II.1.
potential differences elements of an area with other regions. Analyze a region (or parts
of) the whole or view the various regions with diverse potential and how to set up a
policy to accelerate the economic growth of a region. With this objectives, we can
analyze and developing every potention that exist in every region and hopefully it can
boost economic development in every region.
Each region needs to develop state of the economy, so it is necessary to develop
economic development. According Adisasmita (2008) regional economic development
is a function of the potential of natural resources, labor and human resources, capital
investment, infrastructure development, transport and communications, industry
composition, technological, economic and trade situation between regions, capabilities
and funding financing of regional development, entrepreneurship, local institutions and
widespread development environment.
Goods and Services in the Public Economy activity. It can be said that the growth
involves the development of a single dimension and measured by increased production
and income. In Economic Growth, usually in the production process which involves a
review of a number of types of products by using a specific means of production
(Djojohadikusomo: 1994).
Adearman (2006), the definition of economic growth is the perspective of a time
period when the economy is said to be experiencing growth in a long time (10, 20 or 50
years, or even longer) experienced an increase in output per capita. Of course during
that time could happen fall in output per capita, due to crop failure for example, but if in
quite a long time the per capita output shows an ascending tendency, it can be said that
economic growth occurs.
Some economists argue that the tendency of the increase in output per capita
alone is not enough, but the increase in output will have to come from the internal
processes of the economy. In other words, the process of economic growth must be selfgenerating, which means that the process of growth itself generates the power for the
onset of continued growth in future periods.
II.4.
base activity and non-base activity. Base activity is activity with base-oriented to sell
goods and services outside bounds economys area that is concerned. While the nonbase activities are local oriented activities that provide goods and services to the people
need within the borders of the respective economies.
One way to determine a sector as a sector basis or non-base is by using Location
Quotient (LQ). Arsyad (1999: 315) explains that the technique can divide the Location
Quotient economic activity of a region into two groups. namely:
1. The activities of economic sectors that serve markets in the region itself and outside
the region concerned. Sectors of the economy such as this so-called economic
sectors Potential (Base).
2. The activities of economic sectors that serve the regional market potential is not
called sectors (non-base) or Local Industry.
This theory states that the main determinants of economic growth in the region
is directly related to the demand for goods and services from outside the area. The
growth of industries that use local resources, including labor and raw materials for
export, will generate local wealth and employment creation (job creation) (Arsyad,
1999).
III.
RESEARCH METHODOLOGY
III.2.
Scope of Research
In accordance with the objectives that want to be achieved in this research,
writer want to analyze the distribution of base and non-base sector in Kota Surabaya. As
a result of this analysis, it is expected to contribute in the regulation making by
Government. It can seen from the contribution of every sector and the effect among
sector itself.
III.3.
and Input-Output Tables. The data is in the form of documents obtained from the
following sources:
1. Central Bureau of Statistics (BPS) of Kota Surabaya website
2. Central Bureau of Statistics (BPS) East Java website
3. Previous research
III.4.
Specification:
a. If the results of LQ> 1 then the sector is considered a sector basis,
meaning that the level of specialization of Kota Surabaya is higher than
the level of East Java. Commodity production is concerned has
exceeded the consumption needs in the areas where the commodity is
produced and the excess can be sold outside the region (exports).
b. If LQ <1 then the sector considered non sector basis, meaning that the
level of specialization in Kota Surabaya is lower than in East Java
province.
III.4.2.Shift-Share Analysis
Shift-Share analysis is a technique to analyze changes in comparison with
the regional structure of the national economy. In this analysis, will be compared
how local growth conditions for national growth. The aim is to view and
determine the performance or productivity of the regional economy with the
wider area or nationally.
General form of the equation shift share analysis and its components are as
follows:
D ij =N ij + M ij +Cij ( 1 )
Where :
i=Economic sector Region( 9 sectors)
j=Regional variable that examined ( Kota Surabaya )
n=Regional variable East Ja va
Dij =Changes isector Kota Surabaya
N ij =National share i sector Kota Surabaya
M ij =Industrial mix i sector Kota Surabaya
Cij =Regional shift i sector Kota Surabaya
In this study the variable region used is GDP is denoted as (E). Equation
(1) above can be searched with this formulation as follows:
D ij =E ' ij Eij (2)
N ij =Eij ( rn ) (3)
M ij =Eij ( rin rn ) (4)
Cij =E ij ( rijrin ) (5)
Where :
The average GDP growth rate in the province of East Java (rn) can be
defined as follows:
'
rij=
E ij E ij
( 6 )
Eij
'
rin=
rn=
E E
( 7 )
E
E ' nEn
(8)
En
Where :
E =GDP i sector East Java2010
E ' =GDP i sector East Ja va2013
Positive (+)
Kuadrant IV
Kuadrant I
(Potential)
(Rapid Growth)
Kuadrant III
Kuadrant II
(Depressed)
(Develop)
Positive (+)
Negative (-)
Source : Wibowo (2004)
Specification:
a) Quadrant I (PS positive and positive DS) is a region / sector with
very rapid growth.
b) Quadrant II (PS positive and negative DS) is a region / sector at a
speed of stunted growth but tend potential.
c) Quadrant III (PS negative and negative DS) is a region / sector
with weak competitiveness, and also the role of the lower region.
d) Quadrant IV (PS negative and positive DS) is a region / sector
with the speed but growing stunted growth.
IV.
IV.1.
become base sector and non-base sector which can determine the role of sector in
economy activity within a area. The result of Kota Sutrabayas LQ analysis can
showned below :
Table 1 : Location Quotient (LQ) Result of Kota Surabaya year 2010 - 2013
No
1
2
3
4
5
6
7
8
9
Sector/Industry
Agriculture
Mining and Excavation
Processing Industry
Electricity, Gases and Water
Construction
Trade, Hotel and Restaurant
Transportation and
Communication
Finance, Leasing and
Corporate Services
Services
Total
Year
Average
LQ
2010
0,01
0,00
0,86
1,72
2,10
1,36
1,57
2011
0,01
0,00
0,85
1,65
2,05
1,34
1,55
2012
0,01
0,00
0,85
1,62
2,05
1,33
1,52
2013
0,01
0,00
0,83
1,59
2,03
1,32
1,50
0,01
0,00
0,85
1,65
2,05
1,34
1,53
1,20
1,18
1,18
1,17
1,18
0,98
9,80
0,98
9,60
0,97
9,52
0,96
9,40
0,97
9,58
to determine the effect of economic growth in East Java on economic growth in Kota
Surabaya (national growth effect or national share). The second to determine the
relative changes in the performance of the sectors in the city of Surabaya on the same
sectors in East Java (proportional shift or industrial mix). The third is to find a
competitive advantage sectors in Kota Surabaya against the same sectors in East Java
(differential shift or regional shift).
The first analysis is national share. This analysis have main aim to examine the
effect of economic growth in East Java to economic condition in Kota Surabaya. The
result of national share in Kota Surabaya is shown below :
Table 2 : Table 2 : Effect of Economic Growth in East Java on Economy of Kota
Surabaya years 2010-2013 (millions Rupiah)
No
Sector/Industry
1
2
3
Agriculture
Mining and Excavation
Processing Industry
Construction
Transportation and
Communication
GDP Kota
Surabaya
2010
(Eij)
79.171,88
6.353,21
19.225.158
,74
2.054.130,
71
5.916.295,
16
37.025.575
,65
10.082.259
,62
East Java
Average
GDP
Growth
(rn)
22,54
22,54
22,54
22,54
22,54
22,54
22,54
National
Share (Ns)
(Nij)
1.784.478,58
143.196,89
433.321.577,
48
46.298.663,7
3
133.349.138,
30
834.530.474,
61
227.247.051,
75
8
9
5.745.701,
96
7.694.194,
84
87.828.841
,77
Total
22,54
129.504.087,
36
173.421.748,
58
1.979.600.41
7,28
22,54
22,54
No
Sector/Industry
GDP Kota
Surabaya
2010
(Eij)
Agriculture
79.171,88
i sector
Growth in
East Java
Averag
e GDP
growth
in East
Java
(rin)
(rn)
7,79
22,54
Industrial
Mix
Mij = Eij (rinrn)
1.167.424,97
2
3
4
5
6
7
Mining and
Excavation
Processing
Industry
Electricity, Gases
and Water
Construction
Trade, Hotel and
Restaurant
Transportation
and
Communication
Finance, Leasing
and Corporate
Services
Services
Total
6.353,21
12,12
22,54
-66.186,11
19.225.158
,74
19,10
22,54
2.054.130,
71
5.916.295,
16
37.025.575
,65
10.082.259
,62
18,19
22,54
27,41
22,54
31,26
22,54
34,94
22,54
66.156.337,7
1
8.933.026,05
28.835.308,3
5
322.713.833,
43
125.011.602,
98
5.745.701,
96
25,70
22,54
18.187.023,4
7
7.694.194,
84
16,27
22,54
87.828.841
,77
22,54
22,54
48.265.947,9
9
370.158.845,
40
Sector/Industry
GDP Kota
i Sector
i Sector
Differentia
1
2
3
Agriculture
Mining and
Excavation
Processing
Industry
Surabaya
2010
Growth in
Kota
Surabaya
Growth in
East Java
(Eij)
(rij)
(rin)
79.171,88
6.353,21
-0,22
11,65
7,79
12,12
19.225.158
,74
16,47
19,10
Electricity, Gases
and Water
2.054.130,
71
10,72
18,19
Construction
5.916.295,
16
25,08
27,41
37.025.575
,65
29,01
31,26
Transportation
and
Communication
Finance, Leasing
and Corporate
Services
Services
10.082.259
,62
30,53
34,94
5.745.701,
96
23,73
25,70
7.694.194,
84
15,74
16,27
Total
87.828.841
,77
24,21
22,54
l Shift (DS)
Cij = Eij (rij rin)
-634.113,61
-2.966,78
50.590.801,
77
15.350.138,
68
13.803.951,
65
83.197.639,
04
44.438.430,
74
11.332.878,
83
4.062.329,5
9
223.413.25
0,68
region is still low. This is also mean that most of product that used in economic activity
in Kota Surabaya not produced by Kota Surabaya itself but come from another area.
IV.3.
Negative (-)
Positive (+)
Kuadrant
I
(Rapid
Growth)
Kuadrant III(Depressed) :
Kuadrant II (Develop):
1. Mining sector
1. Trade, Hotel and
2. Agricultural Sector
Restaurant Sector
3. Electricity, Gases and 2. Transportation
and
Water sector
Communication
4. Services Sector
3. Construction Sector
5. Processing
Industry 4. Finance, Leasing and
Sector
Corporate
Services
Sector
V.
CONCLUSION
From the result of research that already done, we can conclude several
conclusion and recommendation for Kota Surabaya Government in developing
economic activity in this area, those are :
1. According to Location Quotient (LQ) result, the base sector in Kota Surabaya is
five sector. This mean that this five sector can fullfil the local needs and even
expirt to another region. Those sector are electricity, gases and water sector,
construction sector, trade, hotel and restaurant sector, transportation and
communication sector, and the last one is finance, leasing and corporate services
sector.
2. From national share that have aim to examine the effect of economic growth in
East Java to economic condition in Kota Surabaya. It is founded that trade, hotel
and restaurant sector become sector with largest proportion that affected by
economic growth in East Java. The result is following by processing industry
sector and transportation and communication sector.
3. For proportional share (PS) we can find that the rapid economic growth in trade,
hotels and restaurants and transportation & communication in East Java positive
effect on the same sector in Kota Surabaya.
4. From the result of Differential Shift (DS) we can conclude that all the sector has
no competitive advantage at all. If we can see further this result may caused by
the ability of Kota Surabaya in producing product that have competitive
advantage compared with other region is still low. This is also mean that most of
product that used in economic activity in Kota Surabaya not produced by Kota
Surabaya itself but come from another area.
5. Based on the result in comparing PS and DS, there are no sector that considered
in Kuadrant I or have rapid growth. This result is have same result with LQ
result before. Even in LQ the result are have many sector that become base
sector, but the result are decreasing.
6. Comparison of PS and DS have result in Kuadrant II or developed sector. Those
sector
are
Trade,
Hotel
and
Restaurant
Sector, Transportation
and
developed more it can have good potential to become main contributor not only in
Kota Surabaya but also in East Java and Indonesia.
APPENDIX
7%
29%
25%
DKI Jakarta
West Java
Central Java
DI Yogyakarta
2%
14%
East Java
24%
Banten
Sector/Industry
1 Agriculture
Mining and
2 Excavation
3 Processing Industry
Electricity, Gases and
4 Water
5 Construction
Trade, Hotel and
6 Restaurant
Transportation and
7 Communication
Finance, Leasing and
8 Corporate Services
9 Services
Total
2010
51.329.548,
83
7.757.319,8
2
86.900.779,
13
4.642.081,8
1
10.992.599,
76
106.229.11
2,97
25.076.424,
92
18.659.490,
17
30.693.407,
48
342.280.76
4,89
Year
2011
2012
52.628.433, 54.463.942,
15
77
8.228.632,4 8.419.507,7
8
6
92.171.191, 98.017.056,
46
47
4.932.084,3 5.238.431,6
6
9
11.994.825, 12.840.565,
72
41
116.645.21 128.375.49
4,35
8,60
27.945.256, 30.640.913,
13
33
20.186.109, 21.782.339,
19
97
32.251.530, 33.884.591,
62
41
366.983.27 393.662.84
7,46
7,40
2013
55.330.095,
90
8.697.627,5
6
103.497.23
2,68
5.486.499,1
0
14.006.020,
59
139.431.30
7,45
33.837.742,
37
23.455.842,
04
35.686.078,
02
419.428.44
5,69
Sector/Industry
2010
79.171,88
Year
2011
2012
77.663,11
78.013,26
6.353,21
19.225.15
8,74
6.511,23
20.223.27
8,64
6.743,23
21.421.547,
93
7.093,65
22.390.903,
12
2.054.130,
71
5.916.295,
16
2.089.362,
01
6.316.849,
86
2.188.177,3
8
6.782.238,2
1
2.274.285,7
0
7.400.100,1
1
2013
79.001,28
Agriculture
Mining and
Excavation
Processing Industry
Electricity, Gases
and Water
Construction
37.025.57
5,65
40.371.15
0,00
44.011.461,
26
47.766.042,
34
Transportation and
Communication
10.082.25
9,62
11.122.64
7,38
12.054.700,
61
13.160.461,
86
Finance, Leasing
and Corporate
Services
Services
Total
5.745.701,
96
7.694.194,
84
87.828.84
1,77
6.153.536,
23
8.110.024,
29
94.471.02
2,75
6.613.389,3
3
8.515.422,3
6
101.671.69
3,57
7.109.284,2
8
8.905.129,5
5
109.092.30
1,89
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