Total Factor Productivity Calculation of the Indonesian Micro and Small Scale Manufacturing Industry

The purpose of this research is to determine the total factor productivity (TFP) Indonesia's micro and small-scale manufacturing industries. production function estimation approach established by Levinsohn-Petrin as basis for computing TFP employed in study, with value added dependent variable labor costs capital proxied investment independent variables. This study uses secondary data from Central Statistics Agency (BPS), which includes 23 sub-sectors small scale industries that are included 2-digit ISIC, exception ISIC code 19 sub-sector, covers years 2010 2019, excluding 2016. micro-scale Indonesian industry was often higher than on scale, according study. also demonstrates low-tech sub-sectors, such food processing industry, have low productivity. On a size, estimated shows decreasing trend, but indicates an increasing trend.