Marginal Substitution and Allocative Efficiency Evaluation of Rice Farming Applying Organic Fertilizer In Swampy Land Banyuasin Regency, South Sumatera Province, Indonesia

Abstract

The growing awareness of the negative impact of using inorganic fertilizers on the environment in a small number of rice farmers has made them switch from conventional to organic farming. So far, economic research on the application of organic fertilizers has been widely carried out in irrigated rice fields. Economic research on the application of organic fertilizer use in tidal and lebak land areas has not been widely carried out. Differences in land types are expected to affect the amount of use of organic fertilizers and are also thought to affect production yields and income levels. The purpose of this study was to analyze the reduction in the use of inorganic fertilizers for rice farmers using organic fertilizers and their marginal substitution, as well as the impact of using organic fertilizers on the costs and income of rice farmers using organic fertilizers in tidal and lebak land. This research was conducted in Telang Sari Village, Tanjung Lago District and Sako Village, Rambutan District, Banyuasin Regency, South Sumatra Province, Indonesia. Data was collected in April 2021. The research method was a survey with proportional stratified random sampling. The results showed that (1) the highest reduction of inorganic fertilizer in tidal land was 65.4 percent, while in lebak land it was 57.6 percent; the cost of production factors in tidal and lebak and areas increased by 4.94% and 18.56%; The income of rice farmers in lebak land increased by 60.58%, while on tidal land it was only 32.94%, (2) The marginal substitution of organic fertilizers to inorganic fertilizers was -2.61 and -5.68, (3) The use of these factors production for farmers who use organic fertilizers in both tidal and lebak land have not been efficien yett. The use of factors of production must be increased to obtain optimal profits.