The ability of paper industry to encourage its upstream and downstream sectors can be seen by comparing with other sectors and identifying linkages with
other sectors as well. As mentioned above, therefore several issues that can be identified are:
1. How is the contribution of pulp and paper industry in the economy of Riau
Province, in term of demand structure, output structure, gross value added, investment and export–import?
2. How are the linkages between pulp and paper industry with other sectors in
the economy of Riau Province? 3.
How is the contribution of pulp and paper industry in encouraging and pulling the growth of its upstream and downstream sectors?
4. How are the output multiplier and income multiplier of pulp and paper
industry in the economy of Riau Province? 5.
How is the role of pulp and paper industry in key sectors of the economy of Riau Province?
1.3 Research Goals
The development of pulp and paper industry in the economy of Riau Province has been increasing from time to time. Therefore we need to analyze the
impact created by paper industry in the economy of Riau Province. According to the previous issues formulation, therefore the goals of this study are:
1. To analyze the contribution of pulp and paper industry in the economy of
Riau Province, in term of demand structure, output structure, gross value added, investment and export–import.
2. To analyze the linkages between pulp and paper industry with other sectors
in the economy of Riau Province. 3.
To analyze the contribution of pulp and paper industry in encouraging and pulling the growth of its upstream and downstream sectors.
4. To analyze the output multiplier and income multiplier of pulp and paper
industry in the economy of Riau Province. 5.
To analyze the role of pulp and paper industry in key sectors of the economy of Riau Province.
1.4 Research Significances
The study is expected to gain benefits as follow: 1.
As source of information for government decision makers especially for pulp and paper industry development.
2. As literature materials in pulp and paper industry development for the
stakeholders within the industry. 3.
As source of information and data for further relevant studies.
1.5 Scope and Limitations of Research
The study will cover the pulp and paper industry that consist of companies that process raw materials into pulp and paper, which can be consumed directly or
intermediate products that can be used as input materials for other industries. Therefore, the paper products industry that is not produces their inputs paper and
pulp, for example printing and publishing industry will not be covered by this study. The types of pulp in this study are virgin pulp and recovered paper, while
the types of paper in this study are newspaper paper, printing paper, household tissue paper, money paper, decoration paper, etc.
Analysis in this study will be done by doing the analysis on data written in Input-Output Table of Riau Province 2010 based on domestic transaction using
producer price with software application Input Output Analysis for Practitioners IOAP 1.0.1 and Microsoft Excel 2011. The analysis will be used to analyze the
role of pulp and paper industry in Riau Province economic growth. The main limitation of this study is related to the aggregation of sectors and
Input-Output model used in this research. The analysis of this research will only covered the economic aspects and not include the environmental aspects.
Employment data for Input-Output Table is not available so it is not possible to analyze the employment multiplier. Input-Output Analysis used in this research is
static so it is not also considering the income distribution aspects.
II. LITERATURE REVIEW
