Determinants of Palm Oil Productivity in North Sumatra Province

Masnilam Hasibuan, Nurdelila Nurdelila, Rahmat Rahmat


The purpose of this study is to identify, review, analyze and describe various macroeconomic factors such as land area, investment, infrastructure, total production and inflation that affect the productivity of oil palm plantations in North Sumatra province. The research method used is the multiple regression method with the error correction model. This model is used to see that the relationship in the short term is with economic theory and in its solution to the variables of time series that are not stationary in the level and the regression of gradual decrease. From this analysis we will obtain a short-term regression equation towards the long-term equilibrium. The type of data used is secondary data. The results of the investigation show that land area, investment, infrastructure, total production and inflation simultaneously have a significant effect, while the area of land, investment, infrastructure, total production partially has a significant and positive effect, and Inflation has a significant and negative effect on the productivity of oil palm plantations in the north sumatra province in the short and long term balance.


Keywords: land area, investment, infrastructure, total production,  inflation, palm oil productivity

Full Text:



Banerjee, A., Dolado, J. J., & Mestre, R. (1998). Error-correction mechanism tests for cointegration in a single-equation framework. Journal of Time Series Analysis.

Batista e Silva, F. (2011). Land Function: origin and evolution of the concept. Cadernos Curso De Doutoramento Em Geografia Flup.

Beer, G. (2010). The Cobb-Douglas Production Function. Mathematics Magazine.

Buhr, W. (2003). What is Infrastructure? Volkswirtschaftliche Diskussionsbeiträge.

Diwan, R. K. (2006). On the Cobb Douglas Production Function. Southern Economic Journal.

Edwards, G. W., & Williams, J. B. (2006). The Theory of Investment Value. Journal of the American Statistical Association.

Egert, B., Kozluk, T., & Sutherland, D. (2009). Infrastructure and Growth: Empirical evidence. OECD Economics Department Working Paper.

Fatás, A., & Mihov, I. (2012). Fiscal policy as a stabilization tool. B.E. Journal of Macroeconomics.

Grabowski, A. (2014). The Definition of Investment under the ICSID Convention: A Defense of Salini.

Chicago Journal of International Law.

Hájková, D., & Hurník, J. (2007). Cobb-Douglas production function: The case of a converging economy.

Finance a Uver - Czech Journal of Economics and Finance.

Hubacek, K., & Van Den Bergh, J. C. J. M. (2006). Changing concepts of “land” in economic theory:

From single to multi-disciplinary approaches. Ecological Economics.

Islam, R., Abdul Ghani, A. B., Mahyudin, E., & Manickam, N. (2017). Determinants of Factors that Affecting Inflation in Malaysia. International Journal of Economics and Financial Issues.

IWAI, K. (2011). Financial Crisis. TRENDS IN THE SCIENCES.

Kunst, R. M., & Franses, P. H. (1998). The impact of seasonal constants on forecasting seasonally cointegrated time series. Journal of Forecasting.<109::AID-FOR672>3.0.CO;2-U

Labonte, M. (2011). Inflation : Causes , Costs , and Current Status. Macroeconomics Policy.

McAuliffe, R. E. (2015). Cobb-Douglas Production Function. In Wiley Encyclopedia of Management.

Meltzer, J. P. (2015). Investment. In Bilateral and Regional Trade Agreements: Commentary and Analysis.

Oner, C. (2012). Inflation: Prices on the rise.

Sjö, B. (2008). Testing for Unit Roots and Cointegration. Statistical Working Paper No. 2.

Torrisi, G. (2009). Public infrastructure: definition, classification and measurement issues. Economics, Management, and Financial Markets.

Totonchi, J. (2011). Macroeconomic Theories of Inflation. In International Conference on Economics and Finance Research.

Wiser, M. (2013). Principles of Macroeconomics. American Journal of Agricultural Economics.


  • There are currently no refbacks.