UTILIZING ALMOST IDEAL DEMAND SYSTEM TO ANALYZE THE COMPETITION AMONG FOUR MAJOR COUNTRIES OF SALT EXPORTER FOR INDONESIA

Depi, Napita (2018) UTILIZING ALMOST IDEAL DEMAND SYSTEM TO ANALYZE THE COMPETITION AMONG FOUR MAJOR COUNTRIES OF SALT EXPORTER FOR INDONESIA. Other thesis, Universitas Andalas.

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Abstract

This research provides estimates the rate of competitiveness among four major countries of salt exporter for Indonesia, by Using Almost Ideal Demand System (AIDS) as modeling approach; Seemingly Unrelated Regression (SUR) methodology, it will be explained with some output by secondary data processed, over the monthly period (January 2006- August 2017). This examines the linkages between the budget shares of import with the price setting in the international market. The result showed that SUR proves the price setting is significantly affected the market share of imported salt in each of these countries. The expenditure elasticity value from each country source import is positive. All own price elasticity were negative and have unit inelastic. The complementary relationship between imported salt from Australia, India, and Germany also proves that salt from three countries is generally different in order to fulfill the total demand for Indonesian salt imports. Policy changes are found to generate substantial changes in trade flows and competitiveness between producing and importing regions for Indonesia. Key words; Salt, Import Demand, AIDS, SUR, Elasticity of Demand.

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