IDEAS home Printed from https://ideas.repec.org/a/idn/journl/v13y2010i2ep131-164.html
   My bibliography  Save this article

The Dynamics Of Manufacturing Industry And The Response Toward Business Cycle

Author

Listed:
  • Yati Kurniati

    (Bank Indonesia)

  • Yanfitri

    (Bank Indonesia)

Abstract

The role of the manufacturing industry in the economy has expanded significantly from 19 percent in 1990 to 26 percent in 2009, while its labor absorption only increased from 10 percent to 12.2 percent. The cycle of the manufacturing industry has been in line with the economic growth. This study explores the implications of the firm-level heterogeneity over the business cycle. By using the panel multinomial logit, it shows that firms with less capital and small size have greater probability to exit the industry during the boom/bust period. Sensitivity of the company to changes in capital is greater during the boom period. Only highly productive firms enter and begin production during recessions. Companies with higher productivity rate also have greater probability to enter the market. In contrast, higher production cost and higher market concentration increase the probability for smaller companies to exit from the industry.

Suggested Citation

  • Yati Kurniati & Yanfitri, 2010. "The Dynamics Of Manufacturing Industry And The Response Toward Business Cycle," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 13(2), pages 131-164, October.
  • Handle: RePEc:idn:journl:v:13:y:2010:i:2e:p:131-164
    DOI: https://doi.org/10.21098/bemp.v13i2.388
    as

    Download full text from publisher

    File URL: https://bulletin.bmeb-bi.org/cgi/viewcontent.cgi?article=1350&context=bmeb
    Download Restriction: no

    File URL: https://libkey.io/https://doi.org/10.21098/bemp.v13i2.388?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Keywords

    Production; Cost; Capital and Total Factor Productivity; Industry Studies Manufacturing; Business Fluctuations/cycles;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:idn:journl:v:13:y:2010:i:2e:p:131-164. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Lutzardo Tobing or Jimmy Kathon (email available below). General contact details of provider: https://edirc.repec.org/data/bigovid.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.