Analysis Of The Role Of Mineral Mining Sector On The Economy Of West Java Province

Abstract

Based on the results of the Regional Office of Energy and Mineral Resources (ESDM) of West Java Province in 2014, it was stated that resources and the production of mineral of metal, nonmetal and rocks was large that reached 3,743,209,839 tons and 46,528,238 tons respectively. This is indicated that there are still opportunities for investors to develop the sector and it may affect the distribution of income of West Java Province.
Based on the results of research related to the analysis of the role of mineral mining sector of the upstream linkages (αj) between sectors amounted to 0,6954 or <1 and downstream linkages (βi) at 0,7632 or <1. It means that the yield of investment and downstream linkages are still very weak. For the sector’s economic multipliers worth quite significant (> 1) those are the output multiplier = 1.5366, investment multiplier = 1.2552, employment multiplier = 1.2749, added value multiplier = 1.2700, income multiplier = 1.3442 and surplus multiplier = 2.1578. It is indicated that sector could heavily provide economic returns in the sector and that was a great opportunity for investors to invest. The average LQ value of that sector in the West Java Province = 0,1143 or LQ<1, so that the sector has not met the needs of the local economy and needs to impor from other regions. Changes in performance of the sector from the shift clean (PB) of 3,5447 or PB>0, stating that the sector has the performance and progressive employment opportunities. Based on the value of the econometric Ordinary Least Square (OLS) test indicates that coefficient of the sector = 5,6027 was positive (+) where std.error value = 0,3918 indicates that the sector affects the income distribution of West Java Province though the sector is at the least of per capita income distribution of West Java Province where the estimation error rate of 0.3918 % (percent).