Clustering and firm productivity spillovers in Indonesian manufacturing

Suyanto, Suyanto; Sugiarti, Yenny; Setyaningrum, Idfi

doi:10.1016/j.heliyon.2021.e06504

Cited by 13 publications

(20 citation statements)

References 48 publications

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“…The results were robust across all empirical observations. This finding is consistent with theories arguing that knowledge transfer occurs more easily between firms in the same geographical location than between those in distant regions (Suyanto et al, 2021). Cainelli (2008) discovered that manufacturing firms significantly influence economic performance when they are part of an industrial zone, where they exhibit higher productivity than those located outside industrial districts.…”

Section: Resultssupporting

confidence: 91%

Gender diversity, foreign direct investment spillovers, and productivity: Unraveling the role of female workers in Indonesia

Yasin,

Harianto,

Teguh Sambodo

et al. 2024

Bus Strat Dev

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This study investigates the impact of gender diversity on firm productivity following foreign direct investment (FDI) spillover. Using Indonesian firm‐level datasets from 2011 to 2015, we employ gender spillovers to assess women's distinct contributions to labor spillovers, often manifested through their impacts on productivity, knowledge sharing, and innovation. A fixed‐effects estimator using Driscoll and Kraay's standard errors was employed to deal with cross‐sectional dependence. We first examined the intra‐industry spillover effects of FDI, followed by spatial spillovers, to evaluate the influence of one province's productivity changes on neighboring provinces. Our findings reveal significant gender‐driven FDI spillovers in the spatial dimension but not within the sector. The consistent results across subsamples (impacts on domestic firms, Java‐non‐Java Island, feminization degree, and industrial technology intensity) align with theoretical studies that emphasize the influence of geographical proximity on FDI spillovers. No significant intra‐industry spillover effects were observed. Further exploration of informal channels, possibly mediating spillover effectiveness, is recommended to provide insights into the observed sectoral dynamics.

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Section: Resultssupporting

confidence: 91%

Gender diversity, foreign direct investment spillovers, and productivity: Unraveling the role of female workers in Indonesia

Yasin,

Harianto,

Teguh Sambodo

et al. 2024

Bus Strat Dev

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“…Although theoretical literature indicates a potential positive correlation between firm size and productivity, the empirical studies find mixed evidence. Most researchers discover a positive effect of firm size on productivity through capital accumulation [23,24], technology advancement [2,3], skilled workers [4,5], and foreign ownership [7,25]. Several researchers unveil a negative impact of firm size and argue that small and medium enterprises are more productive due to their adaptability in dealing with economic downturn [5], affectivity in learning new knowledge [9], and flexibility in management decisions [8].…”

Section: Firm Size and Productivitymentioning

confidence: 99%

“…The constructed panel data consists of 6,783 firms for 7 years from 2007 to 2013, so the total observations are 47,481. The procedure to construct a balanced panel follows [7]. This balanced panel data is used for estimations under the two models (AA-OLS and RE-GLS).…”

Section: Datamentioning

confidence: 99%

“…Empirical studies unveil mixed evidence, as some research shows a positive impact of firm size on productivity, whereas others find a negative effect. Those who uncover a positive effect argue that large-scale enterprises can adopt a more sophisticated technology [2,3], employ high-skilled professionals [4,5], and receive more spillover benefits from a foreign direct investment [6,7], allowing them to have higher productivity. In contrast, studies that discover a negative impact argue that small and medium enterprises (SMEs) are more efficient than large firms in management decisions and organizational control [8], more effective in acquiring new capabilities [9], and more adaptable in facing the organization and economic problems [5], pushing them to be more productive.…”

Section: Introductionmentioning

confidence: 99%

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The Impact of Firm Size and Market Concentration on Firm Productivity

Suyanto¹,

Sugiarti²,

Kartikasari³

2022

Advances in Economics, Business and Management Research

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This study investigates the impact of firm size and market concentration on firm productivity in Indonesian manufacturing. Firm size has been enduring interest in studies on firm productivity as the impact can be positive or negative. On the other hand, market concentration has increasingly been a key concern in evaluating firm productivity. This study used firm-level panel data of 6,783 manufacturing firms (47,481 observations) across 33 provinces of Indonesia. Two methods were applied in estimating the data; those methods were adjusted-autocorrelation OLS and random effect GLS. The results show that firm size has a significant positive effect on firm productivity, indicating that a large-scale firm experiences higher productivity than a small size firm. In addition, market concentration appears to have a negative impact on firm productivity, suggesting that a firm in a more concentrated industry tends to be less productive. The implication of this study suggests that a firm produces on a large scale and competes in a less concentrated market.

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“…This study uses the one-stage stochastic frontier analysis (SFA) introduced by Battese & Coelli (1995) to avoid the inconsistency effect found in the two-stage estimation approach (Habiyaremye, 2019;Suyanto et al, 2021a). The one-stage SFA simultaneously estimates the production frontier and inefficiency equation to measure the technical inefficiency scores and variables affecting the inefficiency scores.…”

Section: Methods Of Analysismentioning

confidence: 99%

Technical Inefficiency in Nine Clusters of Indonesian Manufacturing Firms And its Determinants: Stochastic Frontier Analysis

Astanto

Suyanto

Santoso

et al. 2022

JEP

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The current study examines the technical inefficiency of Indonesian manufacturing firms and its key determinants. Extending the previous research that mainly focuses on firms in a specific industry, the current study groups firms into nine industrial clusters and estimates them separately to find a variety of results among the clusters. The stochastic frontier analysis (SFA) method is applied to estimate the inefficiency score and the key determinants of 5,848 firms for five years (29,240 total observations). Data period ended in 2014 due to the substantial change in the classification code of the manufacturing industry in the survey by the Indonesian Central Board of Statistics. Five notable findings are recorded. First, the average efficiency score of all observed firms is 0.8815. Second, firm size is found to have a negative effect on inefficiency in the sample of all firms and three out of nine clusters (ISIC 34, ISIC 35, and ISIC 37). Third, foreign ownership generates a negative contribution to firms’ technical inefficiency in both the sample of all firms and the sample of each nine industrial clusters. Fourth, export orientation has various effects on firms across nine industrial clusters, with a dominant significant negative impact in paper and paper product industry (ISIC 34) and metal product industry (ISIC 38). Finally, import intensity provides a significant negative impact on firms in most industrial clusters. These findings support the argument on the importance of absorption capacity and unique firm characteristics in analyzing the impact of key determinants of technical inefficiency.

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Clustering and firm productivity spillovers in Indonesian manufacturing

Cited by 13 publications

References 48 publications

Gender diversity, foreign direct investment spillovers, and productivity: Unraveling the role of female workers in Indonesia

Gender diversity, foreign direct investment spillovers, and productivity: Unraveling the role of female workers in Indonesia

The Impact of Firm Size and Market Concentration on Firm Productivity

Technical Inefficiency in Nine Clusters of Indonesian Manufacturing Firms And its Determinants: Stochastic Frontier Analysis

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