Natural rubber institutional arrangement in efforts to accelerate rural economic development in the province of Riau

Abstract

Purpose This study aims to investigate the pattern and sequence growth or changes in formulating policy strategy. Design/methodology/approach In order to get an accurate information, in this study using rapid rural appraisal method (RRA). RRA is a method with participatory approach to obtain data/information and assessments, generally in the field in a relatively short time. Findings The result of index multiplier effect analysis in the rubber development region in 2010 was 1.83. In 2014 it dropped to 0.65. The conditions show decline in the rubber farming in the countryside. Natural rubber and its derivatives are believed to spur regional economic growth and be able to improve income distribution and poverty alleviation through employment. Institutional arrangement with the concept of natural rubber farming sustainability-based natural rubber (ABKA) provides two effects: first, the direct effect, i.e. the concept of ABKA provides direct benefits to the parties involved in the business. Second, indirect effects, namely, the concept of ABKA, provides benefits to the parties who are not directly involved in the company. Originality/value Originality of this paper shows that a participatory approach used in this research is an RRA and the location of the research is Riau, Indonesia, both of which have not been studied earlier.