Proceedings of the International Conference on Science and Technology (ICOSAT 2017)

The Impact of The Upsus National Program to The Price Risk of Red Chili in Indonesia

Authors
Mr Suherman, Ratna Mega Sari, Rahmah Farahdita Soeyatno
Corresponding Author
Mr Suherman
Available Online August 2017.
DOI
https://doi.org/10.2991/icosat-17.2018.15How to use a DOI?
Keywords
Price risk, Red chili, ARCH GARCH
Abstract
Agricultural prices vary because production and consumption are variable (Gilbert and Morgan, 2010). Red Chili is one of the commodity that has high economic which is very volatile. Volatility refers to volatility refers to variations in economic variables over time (Policy Report, 2011). The National Upsus Program is one of the agricultural ministry programs to increase the production of some main commodities by assisting local farmers in developing irrigation systems, providing transportation access and distributing materials such as seed, fertilizers and pesticides. Red chili was one of the commodities which were selected to be developed by the National Upsus Program in 2015. This study aims to determine and compare the volatility value of the price of red chili and to analyze the impact of The National UPSUS Program in tackling of Price Risk of Red Chili. The results show that the volatility of red chili price before The National Upsus policy has ARCH (1) models. It indicates that the price of red chili is affected by the volatility of the day before. The National Upsus Program in 2015 is effective in making prices more stable. This is indicated by the value of the price of red chili which is below three so there is no heteroscedasticity. Thus the National Upsus Program is able to overcome the price risk.
Open Access
This is an open access article distributed under the CC BY-NC license.

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Cite this article

TY  - CONF
AU  - Mr Suherman
AU  - Ratna Mega Sari
AU  - Rahmah Farahdita Soeyatno
PY  - 2017/08
DA  - 2017/08
TI  - The Impact of The Upsus National Program to The Price Risk of Red Chili in Indonesia
BT  - International Conference on Science and Technology (ICOSAT 2017) - Promoting Sustainable Agriculture, Food Security, Energy, and Environment Through Science and Technology for Development
PB  - Atlantis Press
UR  - https://doi.org/10.2991/icosat-17.2018.15
DO  - https://doi.org/10.2991/icosat-17.2018.15
ID  - Suherman2017/08
ER  -