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Bulletin of Indonesian Economic Studies
ISSN: 0007-4918 (Print) 1472-7234 (Online) Journal homepage: http://www.tandfonline.com/loi/cbie20
An Economic History of Indonesia: 1800–2010
Glenn Withers
To cite this article: Glenn Withers (2013) An Economic History of Indonesia: 1800–2010, Bulletin of Indonesian Economic Studies, 49:2, 243-244, DOI: 10.1080/00074918.2013.809855 To link to this article: http://dx.doi.org/10.1080/00074918.2013.809855
Published online: 26 Jul 2013.
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Bulletin of Indonesian Economic Studies, Vol. 49, No. 2, 2013: 243–51
ISSN 0007-4918 print/ISSN 1472-7234 online/13/020243-9
BOOK REVIEWS
Jan Luiten van Zanden and Daan Marks (2012) An Economic History of Indonesia: 1800–2010, Routledge Studies in the Growth Economies of
Asia Series, Routledge, Abingdon, pp. xviii + 270. Cloth: £100.00.
The Indonesian economy is attracting great global interest. Its recent strength has drawn new attention to the Indonesian story at a time when European and North American economies have been much troubled. For many economists, however, Indonesia has been a nation of unrealised potential. Rich in resources, popula-tion and culture, it has suffered, puzzlingly, from slow growth. In this book, Van Zanden and Marks examine Indonesia’s complex economic history from 1800 to 2010, which they describe as ‘erratic with a high degree of discontinuity’.
The book’s major task is to explain and balance those periods it deines as
Indonesia’s years of economic advancement (1870–1913 and 1968–98), which saw high growth in total factor productivity, and its years of stagnation (1830–60 and 1929–67), which kept Indonesia behind those countries that broke through to lev-els of more sustained growth. In their analysis, the authors draw on Indonesia’s rich statistical tradition, as enhanced by Van Zanden’s reconstruction of Java’s national accounts of the nineteenth century, and by Pierre van der Eng’s recon-struction of Indonesia’s national accounts of the twentieth century.
A chapter on growth accounting, based on these data, serves as the book’s over-view, derives a measure of total factor productivity and provides a broad organis-ing framework. The eight subsequent chapters examine the four periods indicated above, as well as those periods preceding or succeeding them. This chronological organisation contrasts the book with the major economic history of Indonesia, Anne Booth’s thematically organised The Indonesian Economy in the Nineteenth and Twentieth Centuries: A History of Missed Opportunities (Palgrave Macmillan, 1998).
The book is accessible to general readers, except for a few pages of unnecessary mathematical derivations of perfectly well known and easily presented growth-accounting equations. Its strengths are its extensive and descriptive use of data, in an Angus Maddison tradition, and its holistic explanation of each period’s experience. Certainly, the book’s embedding of economic characteristics within a framework of the production function of growth economics, underpinned by wider geographical, socio-political and institutional determinants, makes for rich interpretation, but it shuns rigorous economic analysis.
Van Zanden and Marks instead examine wider determinants of economic growth, such as Indonesia’s global market access; its historical linkages to the Netherlands; the halting evolution of democracy; the role of the ‘strong man’ in post-independence Indonesia; and the development of institutions that
sup-port market exchange, especially in rural and inancial institutions. Such broad
244 Book reviews
discussions tend to stop short, however, of interrogating culture and religion in a land of many cultures across many islands, and the world’s largest Islamic nation. Perhaps they were not key determinants of economic outcomes, but their role is of interest nonetheless.
The authors conclude that Indonesia’s alternating growth regimes have
relected the government’s changing policies, which have swung from coercive
and protectionist, during periods of little to no growth, to market-based and free, during periods of high growth. This is not a novel conclusion. The book’s real appeal lies in the detail it provides of these propositions for the Indonesian case, its explanation and assessment of the political economy that determined the corresponding policy settings, and its attention to how the proceeds of growth were distributed in each major phase of the development story.
Glenn Withers ANU
© 2013 Glenn Withers
http://dx.doi.org/10.1080/00074918.2013.809855
Joan Hardjono, Nuning Akhmadi and Sudarno Sumarto (eds) (2010) Poverty and Social Protection in Indonesia, Institute of
Southeast Asian Studies, Singapore, and SMERU Research Institute, Jakarta, pp. xxxi + 272. Paper: $39.90.
Poverty and Social Protection in Indonesia looks back at the effect of the 1997–98
inancial crisis on poverty in Indonesia, and at the government’s subsequent
introduction of social-safety-net policies to protect the real incomes of Indonesian households and to preserve access to public services. On the one hand, it pre-sents a detailed account of poverty trends before, during and after the crisis; the channels through which the crisis affected households; and the implementation and targeting of the social-policy response. On the other, it provides a technical toolkit for measuring poverty and analysing the targeting performance of social-protection programs.
An interesting introductory chapter by Thee Kian Wie sets the context, by pro-viding an overview of poverty and growth in the three decades before the onset of the crisis. The remaining chapters (many of which have been previously pub-lished as articles by the SMERU Research Institute, in Jakarta) form two parts. Part one deals with poverty trends and with measures of poverty and vulnerability to poverty, while differentiating between transient and chronic poverty. These chap-ters describe the by now well-documented surge in the poverty rate during the crisis, and its gradual decline. They present, clearly and thoroughly, the methods and data required for measuring poverty; and they supply empirical solutions to problems such as how to measure changes in poverty during substantial shifts in relative food prices, as occurred during the crisis. This is especially borne out in chapter 5, by Lant H. Pritchett, Sudarno Sumarto and Asep Suryahadi, which tackles such problems with particular skill – it maps the evolution of poverty from 1996 to 2002 by introducing an innovative, time-consistent method of measuring
