The ranks of Indonesian and Japanese industrial sectors: A further study

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1 Journal of Physcs: Conference Seres PAPER OPEN ACCESS The ranks of Indonesan and Japanese ndustral sectors: A further study To cte ths artcle: Ubadllah Zuhd 2017 J. Phys.: Conf. Ser Vew the artcle onlne for updates and enhancements. Related content - The ranks of Japanese ndustral sectors: Ubadllah Zuhd - An analyss of the characterstcs of Japanese ndustral sectors from 2005 through 2011 Ubadllah Zuhd - The ranks of Indonesan and Japanese ndustral sectors Ubadllah Zuhd Ths content was downloaded from IP address on 18/08/2018 at 04:46

2 Internatonal Conference on Recent Trends n Physcs 2016 (ICRTP2016) Journal of Physcs: Conference Seres 755 (2016) do: / /755/1/ The ranks of Indonesan and Japanese ndustral sectors: A further study Ubadllah Zuhd Faculty of Management and Economcs, Gdansk Unversty of Technology, Gdansk , Poland zuhd@ze.pg.gda.pl Abstract. The purpose of the current study s to extend the prevous study whch analyzes the ndustral sectors ranks of specfc countres. More specfcally, the study ams to conduct a further analyss regardng the ranks by usng the new data as well as new analyss perods. The study focuses on the cases of Indonesa and Japan. In ths study, the analyss perod of the Indonesan case s 2010 whle for the case of Japan s Usng the prevous study as a reference, the study employs the Input-Output (IO) approach as an analyss devce. As wth the prevous study, the results of ths study show that the orders of the ranks depend on the methods used. Nevertheless, from the results, one can argue that the electrcty and gas ndustry was a leadng sector n the Indonesan economy n On the other hand, for the case of Japan, the compettve sector n the Japanese economy n 2011 was the manufacturng ndustry. In terms of the leadng sectors, the current study s dfferent from the prevous one. 1. Introducton Industral sectors are mportant parts n the economc actvtes of one country. The mportance of sectors can be seen on both macro and mcro levels. Therefore, analyzng the ndustres of a partcular country can be an alternatve way to know the outlook of ts economc stuatons. Further, the recommendatons for mprovng the economc condtons of the country mght be generated from the analyss. The examples of prevous studes whch focus on the analyss are [1], [2], [3], [4], [5], and [6]. To the best of my knowledge, after learnng the studes, the research whch the topc s to determne the ranks of the ndustral sectors of countres s stll needed. The research s requred n order to get the nsght about the compettve sectors n the economc actvtes of focused countres. The current study attempts to fulfll the gap. The purpose of the study s to extend the prevous study whch analyzes the ndustral sectors ranks of specfc countres. More specfcally, the study ams to conduct a further analyss regardng the ranks by usng the new data as well as new analyss perods. The study focuses on the cases of Indonesa and Japan. In ths study, the analyss perod of the Indonesan case s 2010 whle for the case of Japan s Usng the prevous study as a reference, the study employs the Input-Output (IO) approach as an analyss devce. 2. Methodology The methodology of ths study refers to the prevous study whch was conducted by [7]. The frst step of the methodology s to expose the data sources. The data sources of ths study are the 2010 Indonesan IO table, and Japanese IO table for The former table s obtaned from [8] whle the latter one s from [9]. The second step s to explore the ndustral sectors of Indonesa and Japan used n ths study. Tables 1 and 2 show the ndustres for the cases of Indonesa and Japan, respectvely. The former table conssts of seventeen ndustral sectors whle the latter one s thrteen ndustres. Content from ths work may be used under the terms of the Creatve Commons Attrbuton 3.0 lcence. Any further dstrbuton of ths work must mantan attrbuton to the author(s) and the ttle of the work, journal ctaton and DOI. Publshed under lcence by Ltd 1

3 The thrd step s to conduct the calculatons n order to determne the ranks of the ndustral sectors of dscussed countres on the analyzed perods. The methods of backward and forward lnkages, the analyss tools n the IO analyss, are employed n the calculatons. Both lnkages descrbe the relatonshp between a partcular ndustral sector and other ndustres. More specfcally, the backward lnkage focuses on the demands of the specfc ndustry on other ndustral sectors. These demands appear as a consequence of the ndustry as a purchaser n the economy. On the other hand, the forward lnkage explans the consequence of the ndustral sector as a seller. The methods are sutable for specfyng the ranks of ndustral sectors on the specfc tme perod. [10] affrm ths argument through the followng statement: Measures have been proposed to quantfy such backward and forward lnkages, or economc connectedness. Comparsons of the strengths of backward and forward lnkages for the sectors n a sngle economy provde one mechansm for dentfyng key or leadng sectors n that economy (those sectors that are most connected and therefore, n some sense, most mportant ) and for groupng sectors nto spatal clusters. One can argue that f the backward lnkage value of sector a s hgher than that of sector b, then sector a gves more benefcal effect because of the hgher capablty of the sector n attractng the economy through ts demands. The smlar argument whch uses the suppler s pont of vew can be utlzed n analyzng the forward lnkage values of two or more ndustres. Ths study apples two forms for each lnkage, namely drect and total. These forms can be seen on both demand-sde and supply-sde IO models. [11] propose the concepts of the former form on both models. To summarze, ths form only ndcates the straghtforward mpacts of the demands and supples of one partcular ndustry. Further, [10] explan the concept of the form on the backward lnkage by usng the followng equaton: where BL ) ( d j, j n BL( d) (1) j a j 1 a, and n are the drect backward lnkage of sector j, the drect nput coeffcent, and the number of ndustral sectors, respectvely. One can calculate a j by dvdng the value of nterndustry sale from sector to sector j by the total outlay of sector j. On the other hand, [12] descrbes the concept of the form on the forward lnkage through the followng equaton: where n F( d) (2) a j j1 F ( d) s the drect forward lnkage of sector. Both equatons use the demand-drven IO model as a base. The usng of row sums n descrbng the drect forward lnkage of the specfc sector n the model s also mentoned by [10]. The nsght of the total form on the backward lnkage n the demand-drven IO model s proposed by Rasmussen (1957) n [10] whle [10] explan ths on the forward lnkage. To summarze, the form descrbes the straghtforward and ndrect effects of the demands and supples of one specfc ndustry. [10] explore the former nsght by usng the followng equaton: where BL ) ( t j and j n BL( t) (3) j l j 1 l are the total backward lnkage of sector j, and Leontef nverse or the total requrements matrx, respectvely. The latter nsght, on the other hand, s explaned by [12] by usng the followng equaton: 2

4 n F( d ) (4) where F ( d ) and j are the total forward lnkage of sector, and Leontef nverse matrx, respectvely. As wth equatons (1) and (2), the equatons (3) and (4) also use the demand-drven IO model as a base. [10] menton that the Ghosh nverse s suggested as a better tool n explanng the total forward lnkage. As a consequence, the supply-drven IO model s a sutable devce for analyzng the forward lnkage. [10] descrbe the followng equatons n representng the lnkage whch uses the model: n j1 b j j1 j FL( d) (5) n FL( t) (6) g j j1 where FL ( d), FL ( t), b j, and g j are the drect forward lnkage of sector, the total forward lnkage of sector, the coeffcents matrx n a supply-drven IO model, and the Ghosh nverse, respectvely. In ths study, all above equatons are mplemented n the calculatons step. The next step s to analyze the ranks of Indonesan and Japanese ndustral sectors on the analyss perods. Conclusons of ths study, and suggestons for further researches are explaned on the fnal step. Table 1. Indonesan ndustral sectors used n ths study. 1 Agrculture, forestry, and fshng 2 Mnng and quarryng 3 Manufacturng 4 Electrcty and gas 5 Water supply, sewerage, waste management, and remedaton actvtes 6 Constructon 7 Wholesale and retal trade; repar of motor vehcles and motorcycles 8 Transportaton and storage 9 Accommodaton and food servce actvtes 10 Informaton and communcaton 11 Fnancal and nsurance actvtes 12 Real estate actvtes 13 Busness actvtes 14 Publc admnstraton and defence; compulsory socal securty 15 Educaton 16 Human health and socal work actvtes 17 Other servces actvtes 3

5 Table 2. Japanese ndustral sectors used n ths study. 1 Agrculture, forestry, and fshery 2 Mnng 3 Manufacturng 4 Constructon 5 Electrcty, gas, and water supply 6 Commerce 7 Fnance and nsurance 8 Real estate 9 Transport and postal servces 10 Informaton and communcatons 11 Publc admnstraton 12 Servces 13 Actvtes not elsewhere classfed 3. Results and analyss Tables 3 and 4 descrbe the ranks of Indonesan ndustral sectors on the analyss perod whch are vewed from the calculatons results usng drect and total backwards lnkages, respectvely. On the other hand, tables 5 and 6 expose the ranks whch are vewed from the results usng drect and total forwards lnkages, respectvely. Meanwhle, the results usng the supply-drven IO model for the Indonesan case are explored n tables 7 and 8. The analyss then focuses on the top fve sectors of each result. More specfcally, one can argue that the sector number 4, electrcty and gas, was a leadng sector n the Indonesan economy n 2010 because t appears as one of the top fve sectors n tables 3 8. In other words, on the analyss perod, the sector had benefcal effects n the Indonesan economy. Tables 9 and 10 expose the ranks of Japanese ndustral sectors on the analyss perod whch are vewed from the results of calculatons usng drect and total backwards lnkages, respectvely. Meanwhle, tables 11 and 12 descrbe the ranks whch are vewed from the results usng drect and total forwards lnkages, respectvely. On the other hand, the results usng the supply-drven IO model for the Japanese case are explored n tables 13 and 14. As wth the prevous case, the top fve sectors on each result are also vewed n the analyss of the Japanese ssue. Based on the analyss, one can say that the sector number 3, manufacturng, was a leadng sector n the Japanese economy n 2011 because t appears as one of the top fve sectors n almost all tables whch explan the ranks. In other words, on the analyss perod, the sector had benefcal effects n the Japanese economy. Table 3. The ranks of Indonesan ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (1). 4 Electrcty and gas Constructon Manufacturng Transportaton and storage Human health and socal work actvtes Accommodaton and food servce actvtes

6 17 Other servces actvtes Busness actvtes Publc admnstraton and defence; compulsory socal securty Informaton and communcaton Educaton Wholesale and retal trade; repar of motor vehcles and motorcycles Fnancal and nsurance actvtes Mnng and quarryng Agrculture, forestry, and fshng Real estate actvtes Water supply, sewerage, waste management, and remedaton actvtes Table 4. The ranks of Indonesan ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (2). 4 Electrcty and gas Constructon Transportaton and storage Manufacturng Human health and socal work actvtes Other servces actvtes Accommodaton and food servce actvtes Busness actvtes Publc admnstraton and defence; compulsory socal securty Informaton and communcaton Educaton Wholesale and retal trade; repar of motor vehcles and motorcycles Fnancal and nsurance actvtes Mnng and quarryng Agrculture, forestry, and fshng Real estate actvtes Water supply, sewerage, waste management, and remedaton actvtes Table 5. The ranks of Indonesan ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (3). 3 Manufacturng Electrcty and gas Wholesale and retal trade; repar of motor vehcles and motorcycles Informaton and communcaton Agrculture, forestry, and fshng Mnng and quarryng Transportaton and storage Fnancal and nsurance actvtes Other servces actvtes Constructon

7 13 Busness actvtes Accommodaton and food servce actvtes Human health and socal work actvtes Publc admnstraton and defence; compulsory socal securty Water supply, sewerage, waste management, and remedaton actvtes Educaton Real estate actvtes Table 6. The ranks of Indonesan ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (4). 3 Manufacturng Agrculture, forestry, and fshng Electrcty and gas Mnng and quarryng Wholesale and retal trade; repar of motor vehcles and motorcycles Informaton and communcaton Transportaton and storage Fnancal and nsurance actvtes Busness actvtes Other servces actvtes Constructon Accommodaton and food servce actvtes Publc admnstraton and defence; compulsory socal securty Human health and socal work actvtes Real estate actvtes Water supply, sewerage, waste management, and remedaton actvtes Educaton Table 7. The ranks of Indonesan ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (5). 13 Busness actvtes Electrcty and gas Mnng and quarryng Fnancal and nsurance actvtes Agrculture, forestry, and fshng Manufacturng Water supply, sewerage, waste management, and remedaton actvtes Informaton and communcaton Transportaton and storage Wholesale and retal trade; repar of motor vehcles and motorcycles Other servces actvtes Accommodaton and food servce actvtes Human health and socal work actvtes Real estate actvtes

8 6 Constructon Publc admnstraton and defence; compulsory socal securty Educaton Table 8. The ranks of Indonesan ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (6). 4 Electrcty and gas Busness actvtes Mnng and quarryng Agrculture, forestry, and fshng Water supply, sewerage, waste management, and remedaton actvtes Fnancal and nsurance actvtes Manufacturng Informaton and communcaton Transportaton and storage Wholesale and retal trade; repar of motor vehcles and motorcycles Other servces actvtes Accommodaton and food servce actvtes Real estate actvtes Human health and socal work actvtes Constructon Publc admnstraton and defence; compulsory socal securty Educaton Table 9. The ranks of Japanese ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (1). 5 Electrcty, gas, and water supply Manufacturng Actvtes not elsewhere classfed Mnng Constructon Agrculture, forestry, and fshery Transport and postal servces Informaton and communcatons Servces Fnance and nsurance Publc admnstraton Commerce Real estate Table 10. The ranks of Japanese ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (2). 3 Manufacturng Electrcty, gas, and water supply Constructon Agrculture, forestry, and fshery Mnng Actvtes not elsewhere classfed Transport and postal servces Informaton and communcatons Servces Publc admnstraton Fnance and nsurance Commerce Real estate

9 Table 11. The ranks of Japanese ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (3). 3 Manufacturng Servces Transport and postal servces Informaton and communcatons Commerce Mnng Fnance and nsurance Electrcty, gas, and water supply Publc admnstraton Real estate Constructon Agrculture, forestry, and fshery Actvtes not elsewhere classfed Table 12. The ranks of Japanese ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (4). 3 Manufacturng Servces Transport and postal servces Commerce Informaton and communcatons Mnng Electrcty, gas, and water supply Fnance and nsurance Real estate Agrculture, forestry, and fshery Constructon Publc admnstraton Actvtes not elsewhere classfed Table 13. The ranks of Japanese ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (5). 2 Mnng Actvtes not elsewhere classfed Agrculture, forestry, and fshery Electrcty, gas, and water supply Manufacturng Transport and postal servces Informaton and communcatons Fnance and nsurance Commerce Servces Constructon Real estate Publc admnstraton Table 14. The ranks of Japanese ndustral sectors on the analyss perod, based on the results of calculatons usng equaton (6). 2 Mnng Agrculture, forestry, and fshery Actvtes not elsewhere classfed Transport and postal servces Electrcty, gas, and water supply Manufacturng Informaton and communcatons Fnance and nsurance Commerce Servces Constructon Real estate Publc admnstraton

10 4. Conclusons and further researches Ths study, as a contnuaton study of the prevous one, determnes the ranks of Indonesan and Japanese ndustres by usng the analyss methods n the IO analyss, backward and forward lnkages, and new data as well as new analyss perods for the focused countres. As wth the prevous study, the results of the current study show that the orders of the ranks depend on the methods used. Nevertheless, from the results, one can argue that the electrcty and gas ndustry was a leadng sector n the Indonesan economy n On the other hand, for the Japanese case, the sector whch had the benefcal effects n the Japanese economy n 2011 was the manufacturng ndustry. In terms of the leadng sectors, the current study s dfferent from the prevous one. The suggested further research from the current study s to expand the analyzed ndustral sectors for each analyzed country. Ths suggeston s mentoned n order to get the deeper understandng regardng the economc condtons of analyzed countres on the specfc perod of analyss, especally about the ranks of ther ndustres. Ths deeper understandng mght be useful n determnng the prortzed sectors on ther economc actvtes n the future. The other suggested further research s to expand the area of analyss usng the same methodology so the ndustral sectors ranks of, for example, the specfc regon can also be analyzed. One of the examples s to expand the analyss for the other ASEAN countres. References [1] Zuhd U 2014 The mpacts of fnal demand changes on total output of Indonesan ICT sectors: an analyss usng nput-output approach IOP Conference Seres: Materals Scence and Engneerng [2] Zuhd U, Prasetyo A D and Sanpar C P M 2013 Analyzng the dynamcs of total output of Japanese creatve ndustry sectors: an nput-output approach Proceda Economcs and Fnance [3] Zuhd U 2012 Analyzng the nfluence of creatve ndustry sector to the natonal economc structural changes by decomposton analyss: the case of Indonesa Proceda-Socal and Behavoral Scences [4] Zuhd U, Utomo D S and Alamanda D T 2011 Analyzng the role of ICT sector to the natonal economc structural changes: the case of Indonesa Jurnal Manajemen Teknolog [5] Zuhd U 2015 An applcaton of nput-output analyss n analyzng the mpacts of fnal demands changes on the total outputs of Japanese energy sectors: a further study Journal of Physcs: Conference Seres [6] Zuhd U, Mor S and Kamega K 2014 Analyss of nfluences of GDP and ICT on Indonesan ndustral structural changes usng statstcal analyss: Journal of Fnance and Accountancy [7] Zuhd U 2016 The ranks of Indonesan and Japanese ndsutral sectors IOP Conference Seres: Earth and Envronmental Scence [8] BPS-Statstcs Indonesa 2016 Statstcal Yearbook of Indonesa 2016 [onlne] (accessed December 30, 2016) [9] Japanese Mnstry of Internal Affars and Communcatons Input-Output Tables for Japan [onlne] (accessed December 30, 2016) [10] Mller R E and Blar P D 2009 Input-Output Analyss: Foundatons and Extensons (Cambrdge: Unversty Press) [11] Chenery H B and Watanabe T 1958 Internatonal comparsons of the structure of productons Econometrca [12] Nazara S 2005 Input-Output Analyss [n Indonesan] (Jakarta: The Faculty of Economcs of Unversty of Indonesa) [13] Zuhd U 2014 Analyzng the mpacts of fnal demand changes on total output usng nput-output approach: the case of Japanese ICT sectors IOP Conference Seres: Earth and Envronmental Scence [14] Zuhd U 2014 Analyzng the role of creatve ndustres n natonal economy of Japan: Open Journal of Appled Scences [15] Zuhd U 2014 An nput-output approach to analyze the ways to ncrease total output of energy sectors: the case of Japan IOP Conference Seres: Earth and Envronmental Scence

11 [16] Zuhd U 2014 The dynamcs of total output of Indonesan nformaton and communcaton technology sector when fnal demand changes occur: an analyss usng nput-output approach Advanced Scence Letters [17] Zuhd U 2014 The other perspectve related to the role of nformaton and communcaton technologes sectors n natonal economy: the case of Japan Advanced Scence Letters [18] Zuhd U 2014 The role of nformaton and communcaton technology sectors n Indonesan natonal economy from 1990 through 2008: an analyss usng nput-output approach Advanced Scence Letters [19] Zuhd U 2014 Usng multplers analyss n order to get another perspectve related to the role of ICT sectors n natonal economy of Indonesa: Journal of Physcs: Conference Seres [20] Zuhd U 2015 An analyss of the role of nformaton and communcaton technology sectors on Japanese natonal economy from 1995 through 2005: an applcaton of multpler analyss IOP Conference Seres: Earth and Envronmental Scence [21] Zuhd U 2015 An applcaton of multpler analyss n analyzng the role of nformaton and communcaton technology sectors on Indonesan natonal economy: IOP Conference Seres: Earth and Envronmental Scence [22] Zuhd U 2015 The dynamcs of Indonesan creatve ndustry sectors: an analyss usng nput-output approach Journal of the Knowledge Economy [23] Zuhd U 2016 The dynamcs of the total output of the fshery sector: the case of Indonesa Journal of Physcs: Conference Seres [24] Zuhd U 2016 The dynamcs of the total output of the Japanese fsheres sector: an analyss usng nput-output approach Journal of Physcs: Conference Seres [25] Zuhd U 2016 The dynamcs of the total outputs of Japanese nformaton and communcaton technology sectors: a further study Journal of Physcs: Conference Seres [26] Zuhd U 2016 The Indonesan economy n 2005: an analyss usng the nput-output approach Proceedngs of 20th EBES Conference-Venna [27] Zuhd U, Mor S and Kamega K 2012 Analyzng the role of ICT sector to the natonal economc structural changes by decomposton analyss: the case of Indonesa and Japan Proceda-Socal and Behavoral Scences [28] Zuhd U, Mor S and Kamega K 2013 Analyss of nfluences of ICT on structural changes n Japanese commerce, busness servces and offce supples, and personal servces sectors usng multvarate analyss: The Asan Journal of Technology Management [29] Zuhd U, Mor S and Kamega K 2014 Statstcal analyss of nfluences of ICT on ndustral structure changes from 1985 through 2005: the case of Japan Journal of Computers [30] Zuhd U, Mor S and Kamega K 2015 Forecastng the nfluences of nformaton and communcaton technology on the structural changes of Japanese ndustral sectors: a study usng statstcal analyss Internatonal Journal of Socal, Behavoral, Educatonal, Economc, Busness and Industral Engneerng [31] Zuhd U and Prasetyo A D 2014 Examnng the total output changes of ICT sectors of Japan: an approach of nput-output Proceda-Socal and Behavoral Scences [32] Zuhd U, Prasetyo A D and Putranto N A R 2014 Analyzng the changes of total output of Japanese lvestock sector: an nput-output approach Proceda-Socal and Behavoral Scences [33] Zuhd U, Putranto N A R and Prasetyo A D 2014 An nput-output approach to know the dynamcs of total output of lvestock sectors: the case of Indonesa Proceda-Socal and Behavoral Scences [34] Zuhd U, Putranto N A R and Prasetyo A D 2014 Encouragng nformaton and communcaton technology sectors usng nput-output approach: the case of Indonesa Advanced Scence Letters

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