Identifying production costs of Rosa sp: a transaction costs economics perspective

Abstract

Transaction costs are costs that appear in almost every economic transaction. The existence of transaction costs creates production cost inefficiencies. This research aims to identify the production costs borne by rose farmers as one of the leading commodities in East Java, especially Batu City. Apart from that, this research also identifies transaction costs that make production costs inefficient. The method used in this study is qualitative. The data collection tool used was unstructured interviews with rose farmer group administrators in Gunungsari Village, Batu City. Based on the research results, without transaction costs, the average total costs incurred by rose farmers in cutting rose farming is IDR 43,565,085.78 per planting season. The research results also show that there are six types of transaction costs that we have identified. These costs consist of explicit and implicit costs. Explicit costs refer to costs that are clear in amount and farmers know the exact data. Meanwhile, implicit costs refer to costs that farmers do not know the exact amount of.