Proceedings of the 2016 Global Conference on Business, Management and Entrepreneurship

Productivity Analysis on Local Government-owned Drinking Water Companies (PDAMs) in Indonesia and Its Market Challenge

Authors
Anang Mufftiadi
Corresponding Author
Anang Mufftiadi
Available Online August 2016.
DOI
https://doi.org/10.2991/gcbme-16.2016.52How to use a DOI?
Keywords
Cobb-Douglass, Increasing Return to Scale
Abstract
Potential market for Local Government-owned Drinking Water Companies (PDAMs) in Indonesia are huge, but the performances are unsatisfactory. In 2014, only 51% classified as 'healthy'. The aim of this study is to identify production characteristics using Cobb Douglas Model, which is the functional relationship between output (production quantities) with input (amount of human resources and assets). Quantity production is the basis to enhanced customer service and realization of the potential market. The data used is as much as 358 PDAMs in Indonesia. The result showed that there is highly significant inluence of the number of human resources and assets on the production quantity, with coefficient of determination of 0.75. Elasticity of production of assets = 0.277 and of human resources = 0.91. Furthermore (alpha + beta) = 1.19, which showed that the production function is increasing returns to scale. Refer to this model, as many as 186 (52%) classified as productive and 172 (48%) classified as unproductive. The productive PDAMs, basically have better market opportunities exploitation and potentially attract investors. PDAMs in Indonesia do not have reliable level of production to increase its market coverage yet, because of their low scale of production.
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Proceedings
2016 Global Conference on Business, Management and Entrepreneurship
Part of series
Advances in Economics, Business and Management Research
Publication Date
August 2016
ISBN
978-94-6252-268-8
ISSN
2352-5428
DOI
https://doi.org/10.2991/gcbme-16.2016.52How to use a DOI?
Open Access
This is an open access article distributed under the CC BY-NC license.

Cite this article

TY  - CONF
AU  - Anang Mufftiadi
PY  - 2016/08
DA  - 2016/08
TI  - Productivity Analysis on Local Government-owned Drinking Water Companies (PDAMs) in Indonesia and Its Market Challenge
BT  - 2016 Global Conference on Business, Management and Entrepreneurship
PB  - Atlantis Press
SN  - 2352-5428
UR  - https://doi.org/10.2991/gcbme-16.2016.52
DO  - https://doi.org/10.2991/gcbme-16.2016.52
ID  - Mufftiadi2016/08
ER  -