Could Palm Oil Plantation Increase Individual Expenditure? The Dutch Disease Implication in Indonesia

Indonesia is the largest palm-oil producing country, covering almost 80 percent of global production. With extensive production capacity, this research seeks to analyze linkages between palm oil and its impact on economy by individual monthly expenditure. To reveal connections, analyzes Dutch Disease phenomenon in Indonesia, which explains how non-tradable sector, industry, affects tradable sector like manufacturing industry. The panel data variables are selected from 2011 2015 within 22 provinces see Disease's implications. As model suffered endogeneity, correlation explanatory with error term, uses Instrumental-Variable Regression method. analysis indicates that was not Disease. Therefore, could increase Finally, extension plantations benefit Indonesia's without affecting other sectors.JEL Classification: E21, E24, O13, O44How Cite:Siregar, C. D. T., & Sihaloho, E. (2021). Could Palm Oil Plantation Increase Individual Expenditure? Implication Indonesia. Signifikan: Jurnal Ilmu Ekonomi, 10(1), 77-92. doi: http://doi.org/10.15408/sjie.v10i1.15831.