The subsidized fertilizer policy is the government's effort to increase agricultural production and productivity in general. However, in the distribution process, there are still various distribution problems that lead to rent-seeking behavior. The purpose of this research is to describe the behavior of rent-seekers in the distribution of subsidized fertilizers. The research method used is focus group discussion (FGD) involving various stakeholders including (1) government, (2) academics, (3) associations, (4) farmer groups, (5) government-owned enterprises, and fertilizer distributors. The results showed that there had been a pattern of rent-seekers distributing subsidized fertilizers to farmers. The behavior of these rent-seekers includes fertilizer prices exceeding the Highest Economic Price (HET), transaction costs, fertilizer distribution that is not on target until there is a shortage of fertilizer. The government needs to develop a new strategy to optimize the distribution of subsidized fertilizers to farmers. The strategy is to change the subsidy policy to a direct subsidy to farmers. Furthermore, the government needs to optimize investment in the agricultural sector in the form of technology, human resources, electricity, and road infrastructure.
This study aims to capture the investment performance of the agricultural sector in capital formation and the incremental capital output ratio (ICOR) and its relative contribution to the national economy in the 2011-2020 period. ICOR research method is the ratio of changes in output due to changes in capital as an indicator to measure investment performance. The research data used is secondary data obtained from the Central Statistics Agency (BPS). The results of the study show that the investment performance of the food crop agricultural sector has fluctuated throughout 2011-2020. The impact of the policy on the agricultural sector was generally positive, but in that vulnerable year, investment leakage was found that led to efficiency. The cause of the leakage is the behaviour of rent-seeking which is reflected in the time leading up to the elections, namely in 2014 and 2018 with the leakage rate of the investment budget in that year being very high, namely 74.09% and 84.50%, respectively. The year 2012 was marked by an ICOR value close to 0 (zero) accompanied by the growth and performance of the agri-food sector of 12.80%. In 2013 and 2015 the performance of the food crop sector contributed to the economic growth of the food crop sector by 8.65% and 15.78%. Unfortunately, the potential for loss of income in that year was very high, namely Rp. 8.16 trillion and Rp. 17.45 trillion, respectively. The best period for the performance of the food crop agricultural sector occurred in the rent-seeking behaviour that occurred in 2 motives, namely political and economic motives. Political motives occur through the mechanism of the backing system and lobbying. The economic motive is caused by the emergence of transaction costs for the distribution of subsidized fertilizers so that it leads to an increase in the HET for subsidized fertilizers.
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