A review input factors elasticity and return to scale of cooperative: a survey on Indonesian savings-loan cooperatives

This study aims to reveal the production function, return to scale, and production factors elasticity of cooperative by using Indonesia financial service cooperative (IFSC) which has a single business in the field of financial service as a sample of research. Using panel data, this study results bot...

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Bibliographic Details
Published inIndependent Journal of Management & Production Vol. 9; no. 4; pp. 1274 - 1290
Main Author Situmorang, Johnny Walker
Format Journal Article
LanguageEnglish
Published Sao Paulo Independent Journal of Management & Production, I J M & P 01.10.2018
Subjects
Asset backed securities
Banking
Competition
Competitive advantage
cooperative
Cooperatives
Cost control
Economic models
Economics
Economies of scale
Efficiency
elasticity
Expansion
Externality
Financial services
Microeconomics
Microfinance
Price elasticity
production function
Production functions
return to scale
Studies
Jakarta Indonesia
United States > US
Indonesia
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Summary:This study aims to reveal the production function, return to scale, and production factors elasticity of cooperative by using Indonesia financial service cooperative (IFSC) which has a single business in the field of financial service as a sample of research. Using panel data, this study results both labour and capital factors have a significant influence IFSC production.  The IFSC industry condition is increasing return to scale (IRS). Production elasticity of capital is higher than labour force so that IFSC business expansion is faster with increasing IFSC capital. The cooperative financial services industry condition is increasing return to scale that enables IFSC business expansion.  Given the availability of IFSC resources and its operating environment, IFSC's business expansion strategy should be more labour-intensive than capital-intensive, employing more labour than capital. The government should provide support for improving human resource capacity
ISSN:2236-269X
2236-269X
DOI:10.14807/ijmp.v9i4.832