Scale Efficiency of External Factors to Productivity of Smallholder Palm Oil Agriculture

Abstract

This study aims to evaluate palm oil productivity by the smallholders in Indonesia, which offered by particular external factors condition. This article consists of 400 smallholders from 5 different districts as respondents. Evaluation of the survey data was undertaken using inferential statistics, one-way and two-way analysis of variance (ANOVA), and regression methods. An increase of 1 USD income per day would translate to an increase of 2 kg of output. Local government support is more critical than the central government since it can boost up to 100 kg of output. Corporate support and Indonesian Sustainable Palm Oil certification help boosting the harvest up to 80 kg of output. The current farming association shows a sign of inefficiency. The plantation lifespan has a positive impact on output productivity, which will be achieved when the plantation lifespan has productive periods. That indicates that external factors affect the smallholder's productivity in its way.