The Impact of Input and Output Prices on The Household Economic Behavior of Rice-Livestock Integrated Farming System (Rlifs) and Non Rlifs Farmers

Abstract

Integrated farming system is a system that emphasized linkages and synergism of farming units waste utilization. The objective of the study was to analyze the impact of input and output prices on both Rice Livestock Integrated Farming System (RLIFS) and non RLIFS farmers. The study used econometric model in the form of a simultaneous equations system consisted of 36 equations (18 behavior and 18 identity equations). The impact of changes in some variables was obtained through simulation of input and output prices on simultaneous equations. The results showed that the price increasing of the seed, SP-36, urea, medication/vitamins, manure, bran, straw had negative impact on production of the rice, cow, manure, bran, straw and household income. The decrease in the rice and cow production, production input usage, allocation of family labor, rice and cow business income was greater in RLIFS than non RLIFS farmers. The impact of rising rice and cow cattle prices in the two groups of farmers was not too much different because (1) farming waste wasn’t used effectively (2) manure and straw had small proportion of production costs. The increase of input and output price didn’t have impact on production costs and household expenditures on RLIFS.