ECONOMIC POLICIES ON RICE COMMODITY AND WELFARE

<div>This study aims at determining the impacts of economic policies on rice and welfare in Indonesia.</div><div>It estimates a simultaneous equation model with two-stage least squares method, using secondary</div><div>data from 1979 until 2008. The simulation of partial policy will be a trade-off for the producers and</div><div>consumers of rice. The policy of the floor grain price is still needed to respond to the increased</div><div>production of rice. The paper suggests that if the input subsidy is taken out, it should be preferably</div><div>followed by the increase in output, and at least, the rising percentage should be in the same number</div><div>so that the policy will be better off.</div><div><br /></div><div>Keywords: Welfare, trade-off, better-off, simultaneous equation model</div><div>JEL classification numbers: Q13, Q18