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Rural-urban linkages and development : a case study of North Sulawesi, Indonesia 1998

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RURAL-URBAN LINKAGES AND DEVELOPMENT: A CASE STUDY OF NORTH SULAWESI, INDONESIA by N O L D Y T U E R A H B . S c , Sam Ratulangi University, Indonesia, 1985 M . A . , The Flinders University of South Australia, 1990 A THESIS S U B M I T T E D I N P A R T I A L F U L F I L L M E N T O F T H E R E Q U I R E M E N T S F O R T H E D E G R E E OF D O C T O R OF P H I L O S O P H Y in T H E F A C U L T Y OF G R A D U A T E S T U D I E S (School of Community and Regional Planning) We accept this thesis as conforming to the required standard T H E U N I V E R S I T Y OF B R I T I S H C O L U M B I A December 1997 © Noldy Tuerah, 1997 In presenting this thesis in partial fulfilment of the requirements for an advanced degree at the University of British Columbia, I agree that the Library shall make it freely available for reference and study. I further, agree that permission for extensive copying of this thesis for scholarly purposes may be granted by the head of my department or by his or her representatives. It is understood that copying or publication of this thesis for financial gain shall not be allowed without my written permission. Department of The University of British Columbia Vancouver, Canada Date DE-6 (2/88) 0 1 A B S T R A C T There is a lack of research on the relationships between rural areas and the urban hierarchy in Indonesia. Because of this, policies for urban and rural development are undertaken in isolation from one another, without incorporating the implications of rural-urban linkages for rural development. This study contributes to our understanding of rural-urban linkages in Indonesia by examining four villages in the Province of North Sulawesi. Because of the importance of the Indonesian government's transmigration program for rural development in North Sulawesi, specific emphasis is placed on the comparison between the experiences of transmigrant villages and indigenous non-migrant villages in their relationships to the urban hierarchy. The main case study covers four villages (two transmigrant, two indigenous) in Dumoga Subdistrict of North Sulawesi. The linkages between these villages and the various levels of the urban hierarchy are articulated through the following key sets of variables: economic ties, population movement, services delivery, physical infrastructure, technology and political administration. The variables associated with administration interact strongly with the other sets of variables, as government policies (an aspect of administration) have impacts on all other forms of rural-urban interaction. In the comparison between indigenous (Mongondownese) villages and those of transmigrants (Javanese and Balinese), it was found that the transmigrants were better off in terms of almost every social and economic indicator. Although the success of the transmigrants may be attributed in large part to the application of their skills at wet rice farming in the new environment of North Sulawesi, they have also been strongly supported in their endeavors by central government programs which provide them with land, tools, irrigation infrastructure and other benefits. |S.., Ul This study also examined in detail the mechanics of policy setting as it pertains to rural villages. It was found that although a system has been put in place by the Indonesian government to promote lower level inputs into the planning process, the continuing strong centralization of the administrative system results in a filtering process as policy suggestions work their way up from lower levels (village, subdistrict, district) to higher levels (provincial, national). Despite efforts at administrative decentralization, policy setting and implementation for rural and urban development remain highly centralized. The concept of the urban hierarchy which was utilized in this study is that which is defined by the Indonesia administrative system, consisting of the provincial capital (medium size city), the district capital (small town) and the subdistrict capital (rural center). It was found that without its administrative functions, the lowest level on this hierarchy (the rural center) would have very few functional linkages to the rural areas, as most of the other sets of linkages bypass the rural centers. The rural-urban linkages of transmigrant villages differed greatly from those of indigenous villages with transmigrants having stronger connections to higher points on the urban hierarchy. Considering the income differences between migrants and non-migrants, the long- term implication of this final point is that we can expect a gradual reduction in the functions of lower level centers i f rural development is successful and incomes increase. Table of Contents iv Abstract i i Table of Contents iv List of Tables v i i List of Figures x i Acknowledgements x i i Chapter One Introduction 1 Background of the Study 1 Problem Statement 6 Objectives of the Study 7 Literature Review and Development of A Conceptual Framework 7 Functions and Roles of Small Towns 7 The Negative and Positive Effects of Linkages 17 Roles and Functions of Small Towns: Evidence from Developing Countries 21 Growth Centers and Rural Development 26 Agropolitan District 28 Rural Central Planning 30 The Impact of the Green Revolution and the Process o f Rural Change 32 Transmigration Program or New Land Settlement 37 Conceptual Framework 40 Chapter Two The Research Process and Description of Study Areas 47 Introduction 47 The Method of Choosing Study Areas 48 Household Sampling 51 Data Collection and the Questionnaire 53 Definition of Maj or Terms 5 5 Data Processing and Analysis 58 Description o f Study Areas 59 The Country 59 North Sulawesi Province 64 Bolaang Mongondow District 68 The Villages 73 The Rural center 80 The Small Town 82 The Medium City 85 Chapter Three Policies for Rural and Urban Development 87 Introduction 87 What is a Village? 89 Agricultural Development Policies 93 Transmigration Programs and Regional Development 100 City Size and Function 108 Why do Medium Cities and Small Towns Need to Develop? 110 Rural-Urban Areas Development and Policies 115 The Challenges and Constraints of Rural-Urban Development 117 Conclusion 118 Chapter Four Characteristics of Nonmigrants and Migrants in the Case Study Areas 121 Introduction 121 Demographic Differentials 123 Occupational Differentials 126 Economic Differentials 134 Ownership Differentials 146 Production 151 The Effects of Rural Development 153 Motivation of Migrants and the Comparative Advantages 156 The Contribution of Migrants to the Region 158 Some Special Issues of Changes and Problems 159 Conclusion 161 Chapter Five Rural-Urban Linkages 165 Introduction 165 Economic Linkages 166 Migration Linkages 182 Service Delivery Linkages 183 Physical Linkages 191 Technological Linkages 198 Conclusion 204 Chapter Six The Financial Linkages Between Central, Local , and Village Governments 207 Introduction 207 Decentralization in Indonesia 209 Government Structure of Indonesia 210 Financial Links Between Center and Region 213 Sources of Local Government Revenue and Problems 216 Local Government Expenditures 223 Village Finance 226 Local Economic Development 228 Conclusion 232 Chapter Seven The Planning Process 236 Introduction 236 The Concept of Development Planning in Indonesia 237 The Process of Compiling Regional Development Plans 243 How do the Bottom-up and Top Down Planning Process Work? 256 The Role of Development Agencies 256 The Role of Local Planning and Development Board (Bappedd) 257 Coordination 260 Local Autonomy 263 Community Participation 266 The Roles of Local Leader 273 Human Resources 275 Conclusion 277 Chapter Eight Conclusions, Implications, and Further Research 280 Introduction 280 Major Findings 281 General Conclusion 296 Policy Implication and Recommendation 301 Further Research 312 Abbreviations and Glossary 314 Bibliography 320 List of Tables Vl Table 2.1 Characteristics of the Villages 50 Table 2.2 Total Respondents Interviewed 52 Table 2.3 North Sulawesi: Population B y Sex, 1920-1990 64 Table 2.4 North Sulawesi: The Structure of Employment by Industry, 1990 and 1994 (percentage) 67 Table 2.5 Bolaang Mongondow District: Population and Density 68 Table 2.6 Bolaang Mongondow : The Structure of Employment by Industry, 1994 (percentage) 69 Table 2.7 Bolaang Mongondow: Sectoral Distribution of Gross Regional Product, 1990-1993 71 Table 2.8 Bolaang Mongondow: Planted Area B y Rice and Crops, 1994 71 Table 2.9 Demographic Characteristics of Sampled Villages 76 Table 2.10 Indicators of Agricultural Development by Village, 1995 78 Table 2.11 Primary Occupation of Person Aged 15 and Over by Village, 1995 79 Table 2.12 Major Public Facilities of Sampled Villages 80 Table 2.13 Manado: Sectoral Distribution of Employment, 1990 and 1994 86 Table 3.1 Rice: Program, Area Harvasted and Total Production per annum, 1960-1988 (1 unit = '000,000 ha/'000,000 ton) 97 Table 3.2 Sponsored and Spontaneous Transmigrants from Java and Ba l i Settled in North Sulawesi 104 Vll Table 3.3 Type of City and Population Size 109 Table 3.4 Strategic Cities in Long-Term Development II 112 (1994/95-2018/19) Table 4.1 Age and Sex of Household Head of Nonmigrants 124 and Migrants Table 4.2 Education and Sex o f Nonmigrants and Migrants 125 Table 4.3 Ma in Occupation of Household Head and 127 Housewife of Nonmigrants and Migrants (percentage) Table 4.4 Part-time Occupation of Household Head and 129 Housewife for Nonmigrants and Migrants (percentage) Table 4.5 Family Labor Utilization and Hired Labor for 134 Nonmigrants and Migrants Table 4.6 Sources of Household Income by Sector and Location (According to Percentage of Households) 137 Table 4.7 Sources of Household Income by Major Commodities (According to Percentage of Households) 138 Table 4.8 Source of Household Income by Nonagriculture Activities (According to Percentage of Households) 139 Table 4.9 The Proportion of Household Expenditure and Average Costs for Dai ly Needs for Nonmigrants and Migrants 140 Table 4.10 The proportion of Household Expenditure and Average Annual Costs for Education, Health, Clothing, Utensils and furniture, and Others, for Nonmigrants and Migrants 142 Table 4.11 Nonmigrant and Migrant Access to Informal Credit Institutions (percentage) 144 Table 4.12 Purchasing of Land (Paddy Fields, Crop Fields, and Empty Land) by Nonmigrants and Migrants (According to Percentage of Households) 145 IX Table 4.13 Land Ownership of Nonmigrant and Migrant Households 148 Table 4.14 Origin of Land Owned by Nonmigrants and Migrants (percentage) 149 Table 4.15 Production Tools of Nonmigrant and Migrant Households (percentage) 150 Table 4.16 Household Goods Ownership of Nonmigrants and Migrants (percentage) 151 Table 4.17 Production of Paddy, Corn, Soybean, and Peanut of Nonmigrants and Migrants (ton) 153 Table 5.1 Nonmigrants and Migrants: Market Location and Households'Needs 170 Table 5.2 Table 5.3 Table 5.4 Total Savings, Total Transfer Outside the Region and Average Amount of Transfer by Nonmigrants and Migrants, in Dumoga Subdistrict (Rupiah) 174 Amount of Capital Transferred by Nonmigrants and Migrants to Support Their Parents, Siblings, Relatives and Children (Rupiah per year) 174 Amount of Capital Transferred and Transportation Costs of Nonmigrants and Migrants for Visi t ing Families and Relatives Outside Village (Rupiah per year) 176 Table 5.5 Table 5.6 Table 5.7 Table 5.8 Proportions of Nonmigrants and Migrants Selling Their Paddy or Rice by Location of Sale 177 Purchasers of Rice Sold by Farmers 178 The Changing Price of Rice and Fertilizer at Four Case Study Villages in North Sulawesi in 1985, 1990, and 1995 (Rupiah) 181 Distance to Schools for Nonmigrants and Migrants (percentage) 185 Table 5.9 Health Facilities: Destinations for Nonmigrants and Migrants (percentage) 187 Table 5.10 Modes of Transportation Used by Respondents to Access Village, Rural center, Small Town, and Medium City Markets (percentage) 193 Table 5.11 Nonmigrants and Migrants Access to General, Agriculture and Health Information (percentage) 200 Table 6.1 Bolaang Mongondow and North Sulawesi: The General Composition of Revenues, 1985/86- 1995/96. 218 Table 6.2 Bolaang Mongondow and North Sulawesi: The Composition of Local Revenues, 1993/94 220 Table 6.3 Bolaang Mongondow and North Sulawesi: The General Composition of Expenditures, 1985/86- 1995/96 224 Table 6.4 Bolaang Mongondow and North Sulawesi: The Composition of Expenditures, 1993/1994 225 Table 6.5 The Composition of Nonmigrants and Migrants Village Revenues 1995/96 (thousand) 227 Table 7.1 Government of Indonesia's Mandated Bottom-up Planning Cycle 253 Table 8.1 Summary of Non-migrants and Migrants Characteristics 283 Table 8.2 Ma in Linkages and Types of Policies Based on Government Levels 287 List of Figures Figure 1.1 Rural-Urban Relations and Rural Development Conceptual Framework 46 Figure 2.1 Map of Indonesia 63 Figure 2.2 Map of North Sulawesi 65 Figure 2.3 Map of Bolaang Mongondow District 70 Figure 2.4 Map of Dumoga Subdistrict 74 Figure 3.1 Structure of Village Government 92 Figure 4.1 Allocation of Household Workers in Four North Sulawesi Case Study Villages, Based on Sector and Type of Workers 133 Figure 4.2 Rural Household Income Sources in Case Study Areas of Four Villages North Sulawesi, Indonesia 135 Figure 5.1 Paddy and Rice Marketing Channels in North Sulawesi 180 Figure 6.1 The Structure of Indonesian Government 212 Figure 6.2 Intergovernmental and Private Sector Funds F low in Indonesia 215 Figure 7.1 The Stages of Planning Process 252 ACKNOWLEDGEMENTS xii I am greatly indebted to my supervisor, Michael Leaf, Ph. D . , for his insightful feedback and unending academic and moral support. I am also very grateful to You-tien Hsing, Ph. D . , and Professor T. G . McGee, members of my doctoral committee who offered constructive criticism and valuable comments. I am also obliged to a number of agencies and people in North Sulawesi and Central Sulawesi for letting me conduct the research. They include the Bappeda of North Sulawesi Province, Bappeda of Bolaang Mongondow District, Bappeda of Manado Municipality, Bappeda of Donggala District, Statistics Office of North Sulawesi, Subdistrict Government of Dumoga, Subdistrict Government of Kotamobagu, Subdistrict Government of Parigi, and the village government of Doloduo, Dondomon, Mopugad Selatan, Mopuya Selatan, Tindaki, Purwosari, and Tolai. I also thank the resource persons working with these offices who shared their data and time with me. M y grateful thanks are also due to M e g Rakow assisted me with copyediting and Catherine Griffiths was a valuable helper in the computer lab. I am particularly indebted to my fieldwork colleagues: Teddy Minggu, Oktavianus Kalangit, Meid i Satiman, Indah Sulangi, Susanti, Christien Karambut, Rinna Pangemanan, and Paulus A . Lowing. To them, and to the many people in the survey villages who gave of their time and patience, and to the administrators in all the desas, kecamatan, and kabupaten in which I worked, I am deeply grateful for their excellent support. Terima kasih banyak. I would like to thank to the Ministry of Education and Culture in Jakarta who sponsored my study. Finally, special thanks to Andrew and Wulan, for their unending love and patience and good humor. 1 CHAPTER ONE INTRODUCTION Background of the Study The growth of primate cities in Southeast As ia is a well-documented phenomenon (McGee, 1969, 1994; Ginsburg, Koppel, McGee, 1991; Laquian, 1993; Leaf, 1994, 1996). Although Southeast As ia is one of the least urbanized regions of the world, population figures of its major cities have soared. Indonesia is no exception to the phenomenon. Its capital city, Jakarta, has a population which doubles every 15 years and had reached 8 mil l ion in 1990 (CBS , 1992). It is part o f the larger extended metropolitan region of Jabotabek, which in 1990 had 16 mil l ion inhabitants. Such metropolitan growth is linked with migration from the countryside as well as sustained by natural increase. The process accelerates as employment opportunities in the countryside dwindle. New agricultural techniques are introduced, often at the cost of marginal employment. For instance, in Indonesia the spreading changes in rice harvesting methods may mean that village women using ani-ani knives and harvesting stalk by stalk are replaced by hired laborers using sickles (Collier, 1979). Even large-scale, capital intensive agricultural undertakings are experiencing harsh competition because deteriorating terms of trade are challenging their position. Nonagricultural activities are also under pressure, both in the countryside and in the regional centers, as competition from big city-based enterprises has increased, both in secondary and trade activities. In some sectors the take-over of small-scale activities has already been completed. Migrants are lured to big cities by the wide range o f jobs offered. Most migrants to Jakarta find employment in the informal sector (Sethuraman, 1976). The size of the informal 2 sector in a metropolis like Jakarta has been positively correlated with the number and size of large-scale industries and government departments, the so-called formal sector (Hugo et al., 1987). This correlation partly depends on the migrants' expectations of eventually finding a job in the formal sector. Researchers claim that hopes, rather than actual job opportunities in the formal sector, attract migrants to Jakarta (Sundrum, 1976; Wirosuhardjo, 1983). Most migrants would never qualify for a formal job. Another type of migrant comes to live in big urban centers for the facilities offered in these places, most important of all being schools and other centers for education. Underlying these demographic trends and economic processes is the concentration of development investment in just a few metropolitan centers. This tendency—whether spontaneous or induced—has been justified by spatial conceptualizations of economic growth theories, such as Perroux's "growth pole" and Hirschmann's "trickle down" notions. Adherents of such concepts have argued that development efforts should be concentrated so as to achieve savings on infrastructure and transport costs for enterprises. The so-called urbanization and conurbation economies are intended to tempt other industries to settle in the growth pole, making use of the forward and backward linkages thus more easily created. Such planning theories have heavily influenced development policy, as implemented by Third World governments and international aid agencies. A s an example of such concentrated investment, during the 1970s Jakarta absorbed 60 percent of all foreign investment in Indonesia and 26 percent of all private Indonesian investment, while government expenditures were twice as high in Jakarta when compared to the highest provincial figures (Hi l l , 1989; Prabatmodjo and Kusbiantoro, 1993). Although expanding quickly, Jakarta contained only 4.4 percent (CBS,1992) of Indonesia's population. 3 Once a certain level of development has been reached and an innovative center has been established, the theorists argued, growth should spread and intraregional economic inequalities as well as differences between city and countryside should diminish. Import substitution industries were considered the type of economic activity most likely to trigger growth and the succeeding spread, thus earnings from primary exports were channeled into this sector. Import substitution, however, proved inadequate as a solid base for the national economy. It was quite limited in its prospects, due to a lack of investment capacity and marketing opportunities. The capital funding sector suffered from low product prices, while the demand for manufactured products remained low and concentrated in the big urban centers. In Indonesia, after the first and easiest stage of import substitution for consumer goods, there was confusion over how to continue industrialization policy. Several options were proposed, such as starting capital goods industries, upgrading exports of agricultural products, or exporting consumer goods (Hi l l , 1989). However, by the 1970s it had become clear that the growth pole approach did not work as planned. Although the concept of concentrating investment still had many supporters, new ideas emerged. Critics of growth pole policy warned that besides its basic weakness of concentrating on economic growth instead of welfare and employment, growth pole policy had other serious drawbacks. It led the population o f the metropolis to expand by multimillions o f migrants. Even worse, its implied preference (urban bias) contributed to a neglect of l iving conditions in the countryside, and of social services in general. The goal of spreading development was not fulfilled. A s a response to such shortcomings, a new development paradigm was sought. Interest in theories of regional planning increased, and greater importance was given to the role of small towns and medium cities 1 in economic development. Previously, small towns had only been ' A small town in the Indonesian context is generally the capital city of the district (kabupaten), and a medium city is the capital city of province. The operational definitions of medium city and small town for this study is discussed in Chapter Two. 4 conceptualized as centers for public administration and locations for social facilities. Most Indonesians live in rural areas and derive a living from various forms of agriculture. The dispersed settlement pattern is punctuated by distinctive nodes which are sometimes large enough to be called towns. These places are described as service centers, and act as the sites of commercial, medical, educational, administrative and associated activities. The growth of the largest Indonesian cities has been relatively well-documented (see McGee 1994; Leaf, 1994; Rutz, 1987; Nas, 1986). They are the foci of the nation's political and economic organizations, whilst within them new social relations are being established. Despite the rapid growth of these cities, it can be argued that they affect directly only a small proportion of Indonesia's population. The rate of urbanization at the provincial level is relatively low, ranging from 31percent to the very low levels of 8 to 12 percent (CBS , 1992). Far less is known about the social, economic and geographical relations of the many small towns and rural centers2 with which the majority of the population have more direct contact. Emphasis should be put on the regional context of these small towns and rural centers, as they constitute the structure on which development plans must be built and implemented. Future development may depend on a viable system o f settlements that intervenes between the primate city and the rural village (Hackenberg, 1980). The distribution o f population in Indonesia is uneven. Two-thirds of Indonesians live on the "inner islands" of Java, Madura, Ba l i and West Nusa Tenggara, which together represent just 8 percent of Indonesia's land area. In 1986, population densities in Inner Indonesia averaged 685 people per square kilometer. Java's population density in 1986 was 774 people per square 2 Rural center is the capital city of the subdistrict {kecamatan). The operational definition of rural center is discussed in Chapter Two. 5 kilometer. Many of Java's districts represent the highest rural population densities in the world, reaching as high as 2,000 people per square kilometer. In Indonesia's "outer islands", population densities average thirty-three people per square kilometer, although they range from seventy-two people per square kilometer on Sumatra and fifty-one people per square kilometer on Sulawesi, to fifteen people per square kilometer on Kalimantan, and just three people per square kilometer on Irian Jaya (World Bank, 1988). The fear of overpopulation on the inner islands, especially in Java and Ba l i , has been an important reason for the Transmigration Program. The two principal objectives o f the Transmigration Program are population redistribution, or "reducing the population density in certain regions in order to facilitate ... development and rehabilitation efforts in said regions," and regional development, or "fulfilling the manpower requirements of ... areas in which the population is relatively scarce, so that the available natural resources, especially agricultural land, can be utilized efficiently and effectively' (Government of Indonesia [GOI], 1984). In order to reach the goal of contributing to regional development in the settlement areas, the transmigrants have to be integrated into their new economic and social environments. Evidence from various settlement areas indicates that the process of this integration is not without problems (Heeren, 1967; Hardjono, 1977; Koentjaraningrat, 1982; Swasono and Singarimbun, 1985). However, in some areas there are indications that certain transmigration settlements are relatively more successful in terms of economic and rural development, when compared with their counterpart indigenous rural settlements. Large-scale transmigration has had a significant impact on town and urban development in the outer islands. Small towns and rural centers in transmigration regions have experienced a boom in activity as a result of transmigration-related construction and the search for off-farm work by local people and by transmigrants. Many of these small towns and rural centers are 6 growing at rates that promise to double their populations in ten years (CBS , 1985). For small towns and rural centers that have no formal urban status and depend mainly on central budgets, rapid increases in road traffic and accelerated growth may be difficult to manage under current planning arrangements. Cities may also find it difficult to keep pace with the accelerated growth, and the capacity to deliver urban services is particularly low in large coastal cities and small frontier towns in the outer islands. Therefore, the growing demands for services in these areas must be taken into account in future development planning. Select key questions which are significant in determining the suitability of various alternative planning strategies are listed in the problem statement section below. Problem Statement There is a lack of research on the relationships between rural areas and the urban hierarchy in Indonesia. Because of this, policies for urban and rural development are undertaken in isolation from one another, without understanding the implications of rural-urban linkages for rural development. 1. H o w do rural centers and small towns contribute to successful economic development in rural settlement areas? Are there significant differences and structures involved which may relate to different impacts upon rural development? How do rural-urban linkages contribute to rural development? 2. Do rural transmigration settlement areas differ from indigenous rural settlements in terms of their linkages with rural centers and small towns? How can the development of local people be improved by learning from the migrants' experiences of successful economic development? 7 3. What possible solutions are currently envisioned by the government policy-makers who are responsible for addressing the problems of the region's rural centers, small towns and rural settlements? Objectives of the Study The study has three main objectives. First, the study is to explore how rural-urban linkages stimulate rural development, how rural development policies stimulate rural communities, and what the impacts of those policies are on rural populations. The chosen approach is an in-depth analysis which targets the specific cases of villages (local rural settlements) and rural transmigration settlement areas in North Sulawesi, Indonesia. The second objective of the study is to attempt to understand the impacts of linkages on rural development, by analyzing the dynamic of various stages of government intervention and the planning process. A particular emphasis is placed on transmigration because of its impacts in the North Sulawesi policy context. The final objective of the study is to obtain data and actual information on policy implementation within rural-urban linkages, so as to shed more light on the types of intervention that are most useful for rural-urban development goals. Producing new knowledge about rural- urban linkages and development in North Sulawesi, Indonesia, is the major goal of the dissertation. Literature Review and Development of A Conceptual Framework Functions and Roles of Small Towns The idea of strengthening the fabric of small towns and intermediate cities was floated as early as August 1963 at the second Rehovolth Congress held in Israel, where participants outlined and discussed the ^Agrindus' concept for "national decentralization by regional 8 concentration" (Weitz, 1965: p.92). The purpose of Agrindus was to secure cooperation between the largest possible number of neighboring villages for the maintenance of agricultural services; the processing, storage, grading, packing, transport, marketing and financing of farm produce; and the establishment of factories and workshops to meet agricultural and other requirements. The cooperative was to be extended to include cultural and sporting facilities, educational and health institutions, etc. (Weitz, 1965; 94). Thus agriculture was to be combined with industry, without undermining the village, an age-old asset. Instead, villages were to be improved, even reformed, and brought into line with changing conditions. A consensus expressed the view that a region deemed suitable as a basis for the described agricultural planning and rural development was one which contained villages linked to a single urban center (Weitz, 1965: 105). Johnson (1970) supported the same view when he observed that "a modern type of agriculture not only presupposes the existence of markets where produce can be sold as well as of markets where inputs can be purchased, but it is necessary that both types of markets should be spatially dispersed in such a way that they w i l l be within satisfactory distance and travel time of farmers, for the single reason that farmers' relative mobility is always limited by their very nature of space bound occupation" (Johnson, 1970: 181). Furthermore, he hoped that "ideally, the investment and production decisions of urban entrepreneurs should trigger a chain reaction of differentially smaller investment and production decisions in town hinterlands, which would manifest themselves not merely in random, unplanned, ribbon-pattern developments extending outward from urban centers along already crowded transport routes, but in more purposefully deployed investment clusters properly located at promising growth points in the widening angles of economic landscapes between main lines of travel and transport" (Johnson, 1970: 184). Johnson advocated the strengthening of the market centers only from the viewpoint of modernization of a developing economy. Equitable growth is another dimension of the problem 9 that warrants a strategy of development oriented to small towns and market centers. If one goal of equitable growth strategy is to provide basic public and social services to large numbers of people in order to increase their productivity, employment potential and incomes, then much of the city-size research indicates that small towns and intermediate cities offer sufficient economies of scale for investment in a wide range of public utilities, infrastructure, social services, commercial activities and small and medium-sized agro-processing and manufacturing enterprises (Clark, 1968). The spread effect of development has failed to occur in many developing countries because of inadequately articulated and integrated settlement systems through which innovations and the benefits of urban economic growth could be diffused (Berry, 1967). In 1980 the U N Center for Human Settlements recommended the "development of a system of intermediate settlements with sufficient dynamism to counteract the attraction of the great metropolises and concentrating on towns of appropriate size as social, economic and cultural centers for their rural hinterlands" ( U N C H S , 1980: 9). Rondinelli and Ruddle (1978) synthesized the previous strategies of economic growth with equity as Urban Functions in Rural Development (UFRD) . Aimed at predominantly rural areas with fairly high population densities and a predominance of small-scale peasant proprietors, U F R D ideas are particularly relevant to poor countries with scarce government funds and manpower resources. The U F R D approach emphasizes a gradual nucleation of dispersed rural populations into hamlets and villages, and encourages urbanization by strengthening strategically located key market towns. In particular, it promotes a concentration of public services in rural growth centers, which not only serve their nucleated village or town populations, but also provide a wide range of services to the surrounding dispersed rural populations (Bromley, 1984: 379). 10 According to Rondinelli (1984: 37) "small town development policies must be focused on strengthening their capacity to stimulate agricultural production and marketing of agricultural goods, to support small scale agro-processing industries, and to diversify the economic base on market centers. Investment in farm-to-market roads is required to link town-based enterprises with rural supply areas and to make services, facilities and inputs for agricultural production and marketing easily accessible to rural populations scattered widely over the landscape. Attention must be given to providing water, basic housing, health and social services in towns to increase the productivity of the labor force, and also to providing off-farm job opportunities and urban amenities that w i l l encourage people to stay in rural areas". Recent literature on spatial planning has emphasized the role of small towns in the process of regional and national development. Towns are supposed to act as intermediaries between the countryside and the big cities where economic and bureaucratic decision-making are concentrated. The increased attention given to the function of small towns in development is linked to many phenomena: the excessive growth of metropolises, the failure of development policies centered on big cities, the neglect of rural resources. Small towns have become a very fashionable subject. Planning concepts are not always realistic, however, and empirical evidence on the present functioning of small towns lags behind regional planning theories. Small towns as propulsive and absorptive growth centers When faced with the excesses of metropolitan growth, many researchers have adopted growth pole theory to support the option of secondary growth centers, due to the concern that congestion in the metropolis is reducing the economies of agglomeration. The concept of the growth pole is not abolished, it is only moved to other places, so as to avoid further pressure on overcrowded cities such as Jakarta, Bandung, Semarang, Surabaya, Medan, Palembang, and 11 Ujung Pandang. Lo and Salih (1978) introduced the concept of urban efficiency with regard to agglomeration economies which they claimed failed to work beyond a certain city size even when the city continued to grow. They advocated policies to both redirect metropolitan growth to middle-size cities and to stimulate lower-level towns to grow into the optimum efficiency-size class. B y having propulsive growth centers in other parts of the country, it was hoped that regional inequalities might also diminish. The sorts of activities associated with the propulsive growth center concept are large- scale industries with high labor productivity and high potential to link with other activities. Such industries need a well-developed physical and institutional infrastructure. Their existence might mean the presence of a trained labor force and high quality commercial services, whether in-firm or not. Such industries would attract other companies to the growth pole, subsidiary as well as independent enterprises (Rondinelli and Ruddle, 1978). To facilitate spread to the hinterland, the complex should develop functional relations with agriculture and rural home-based industries (Hansen, 1978). Regional physical and human resources would have to provide the basis of the main industry. Agro-based industries are often thought of as propulsive in small town centers of growth, but mineral resources, hydro-power plants and existing artisanal skills might be points of departure as well (Rondinelli, 1983). A number of countries in Latin America, Africa and As i a have purposefully attempted to implement growth center strategies in regional development. Their objective is to stimulate production activities, often in the framework of import-substituting industrialization, which would trigger economic growth and restructure the regional economy. The emphasis is mostly on large-scale capital investments and their concentration in urban areas with a view to assumed economies of scale and location. Centers especially suited for such investments are those which function as inter-regional foci of production and trade, generally cities with 100,000 inhabitants 12 or more. It is assumed that the spread effects of polarized growth in these medium-sized centers w i l l have a stimulating effect on the smaller ones within the region. Economic linkages with the regional center w i l l gradually transform the smaller ones into lower order growth foci and make them "instruments of modernization" for their immediate surroundings (Misra and Sundaram, 1978). The development of medium-sized centers w i l l also counter primate city dominance and bring about an "optimal urban hierarchy". Such a hierarchy is thought to facilitate the diffusion of innovations to the lower order centers, thus enabling these to perform in an adequate way their intended roles in the development and modernization of their rural hinterland (Johnson, 1970; Berry, 1972; Misra and Sundaram, 1978; Rondinelli and Ruddle, 1978; Rondinelli and Evans, 1983). However, in developing countries the expected spread effects often appear to be of little consequence for the smaller centers, especially due to the strong economic linkages with extraregional and overseas clients and suppliers. In this respect, Mabogunje (1978) has identified the limited results of growth center strategies based on import-substituting industrialization and the prerequisites which condition their possible success in Third World countries. If the regional policies pursued also aim at the development of smaller centers for the benefit of the rural areas, it seems more appropriate to invest directly in such centers. The question is whether to invest in all of these or only in centers of a specific order or in those enjoying a particularly favorable location. In regions where motorized traffic is already rather well-developed, it seems less desirable to promote the emergence o f a dense network of service centers. In lesser-developed regions, however, the stimulation of "hintertowns" or a type of "intermediate settlement" is advocated as a supposedly necessary link between the rural areas and the higher order urban centers (Manshard, 1977 in Hinderink and Titus, 1988). In several developing countries attempts have been made to stimulate, in a planned way, the development and distribution of such rural 13 centers. The centers' role and importance is no longer seen as derived from the spread effects of polarized growth in the medium-sized regional cities. On the contrary, these rural centers are considered "engines of growth" in their own right and for the benefit of their rural hinterland. Their development as market and service centers helps to increase the productive capacity of the rural producers and promotes the commercialization and specialization of agriculture in the framework o f national economic growth (Mosher, 1969; E S C A P , 1979). The planning and proper functioning of these rural centers is thought to contribute to an "effective" integration of the rural population in the national economic and political order. Moreover, it is assumed that the development of rural centers increases local employment and, in this way, helps to stem the rural exodus to the metropolitan areas (Johnson, 1970; Southall, 1979). Elaborating on the growth center concept, some scholars emphasize the aspect of the redirection and reduction of migration streams. They argue that small towns might compete with a larger city as a place of domicile for potential migrants, provided labor opportunities are sufficient (Rondinelli and Ruddle, 1978) and presuming that the search for work is the dominant motive for such a migration. Compared to a metropolis, small towns have some attractive amenities to offer, namely a more informal and personal atmosphere which might help in the search for a job, a lower cost of l iving, and a healthier l iving environment. Generally speaking, small towns are less troubled by problems such as cramped living space, crime and over- burdened infrastructure. If small towns are to become a redirection location for the migration currently flooding the largest metropolises and attract rural migrants as well as urbanites, labor-absorptive activities should be encouraged within the small town production structure. This might entail large-scale labor-intensive enterprises, but more often small-scale industry is proposed (Lo and Salih, 1978). What is labeled "the informal sector" comes to the fore: low-capital enterprises which are based 14 on local resources and are manageable without high-tech skills. They should, however, offer a enough remuneration in order to justify quitting a rural job but not trying for Jakarta, Surabaya or some other metropolis. This proposed type of labor absorption fits current realities, as Sethuraman (1976) described in Jakarta, where most migrants tend to find work in small-scale trade, transport services or industry. Such labor-intensive, small-scale activities in small towns wi l l differ in character from those in the metropolis. In places like Jakarta, abundant purchasing power exists, supported by the salaries of factory workers and government officials. Besides small-scale industry, products may be ordered by metropolitan large-scale enterprises in such a way that a large and diverse body of informal trade, services and industries is sustained. However, in small towns, although local pockets of wealth exist, there is no such complex in which to participate. Thus, informal sector activities, next to petty trade and services, should be directed at upgrading regional primary produce or substituting large-scale manufactured goods. A s discrimination against informal activities and competition from large scale industry are nation-wide phenomena, a policy that intends to give breath to informal job opportunities in small towns should be nation-wide as well . On a local level the development of skills and the use of locally produced goods should be stimulated. Finally, it should be noted that such an employment program in small towns wi l l not always result in the growth of their population figures. Today's network of roads is of adequate standard to make commuting to and from the villages possible. Small towns as service centers and accelerated rural development The needs of both town and village populations are addressed in the service center concept. Although previously not explicitly concerned with small towns, the notion of spread of 15 services has a long history. Hospitals and schools and extension offices have been regarded as pawns in the development game since prewar colonial times. Facilities are unevenly spread in developing countries, and are usually concentrated in the larger cities. For reason of social justice, public facilities such as education and healthcare ought to be accessible to all citizens, including those l iving in the countryside. Small towns are considered to be efficient locations for such services by planners who are inspired by central place theory and who interpret it normatively ( E S C A P , 1979, Rondinelli and Ruddle, 1978). A good transportation network is a prerequisite. Because it is possible to plan public facilities, equal access seems an attainable target. Steering the location and growth of private enterprises that function as service facilities (i.e., stores, repairshops, printing shops or public transport companies), is less easy. The service center concept resembles the previous concept of small towns as accelerators of rural development. It differs in dealing with the whole range of enterprises serving consumers (whether other enterprises or private persons) living in the countryside or in the town. For the services offered, it is supposed there is no rural provision. The concept of small towns and service centers as motors for rural development is focused on assisting productive activities only. Such a brief discussion of concepts involving small towns does not mention the various combinations of concepts often urged, and by which cross over between service center and rural motor, or absorptive growth pole and rural motor, are met. A s several authors (Titus et al. 1986; Rondinelli, 1983; Lo and Salih, 1978) have pointed out, the functions outlined seem to correlate to town size. For instance, propulsive growth pole potential w i l l be more developed in larger towns because of the larger pool of skilled labor and managerial abilities, and the larger opportunities for interindustrial linkages and subsidiary services to develop (Rondinelli, 1983). Lo and Salih (1978) gave another example, pointing out that smaller towns are more apt to act as agropolises, while middle sized towns can become absorptive growth poles. In this respect, 16 Rondinelli emphasized that secondary centers had large pools of indigenous skills and industry, already oriented towards labor-intensive activities. Instead of being local points of growth, one might conceive of small towns as geared to speeding up rural development. This small town concept is frequently repeated in regional planning. It gained popularity with Friedmann and Douglass' (1976) 'agropolitan district' idea. A country should be split into units of a 'single, integrated, self-governing district,' requiring that each district have sufficient autonomy and economic resources to plan for and carry out its own development. Decentralization of decision-making and concomitant land reform were considered crucial steps. While not every spatial theorist and certainly not every planner is so demanding, strong integration between town and region is viewed by many as necessary and enhanced by good transportation and communication links (Stohr and Taylor, 1981). The urban enterprise associated with the concept of small towns as accelerators for rural development emphasizes rural, and especially agricultural production. First, it entails government extension services and private enterprises distributing inputs like high-yielding seeds, fertilizer, insecticides, and tools. Second, it includes enterprises involved, directly or indirectly, in the marketing or processing of agricultural produce. Next, rural nonagricultural enterprises should also be equipped with tools and raw materials, and the marketing and processing of home industry products undertaken in the regional centers as well . Both large-scale and small-scale urban enterprises might be considered in these respects, with the most important criteria being not size, but their subsidiary and beneficial role. These supporting activities would not meet standards of efficiency when dispersed over a region. Because of the volume of input necessary to sustain an agro-processing plant, for instance, its best locus might be in a regional center. The same holds true, although to a lesser degree, for trade and service activities. 17 The Negative and Positive Effects of Linkages Some argue that small towns and cities are predominantly parasitic—they allow town- based elites and administrative agencies to exploit the rural population and to drain rural areas of their resources, which are invested in metropolitan centers (Lipton, 1977; Funnel, 1988; Potter and Unwin, 1989). The implication is that small towns and cities should not be deliberately developed by the government. If they are encouraged to grow they wi l l likely exploit rather than develop the rural areas in which they are located. Moreover, l inking them to the national space economy w i l l not facilitate the "trickling down" of benefits but merely promote rural to urban migration and the penetration of rural areas by exploitative national governments and multinational corporations. Schatzburg (1979), for example, insists that "the structures and organizations of these small towns usually benefit the already wealthy elements of local society who have the means and ski l l to co-opt most developmental resources and initiatives that originate with the national governments." Thus, he maintains, small towns are "structured to enhance the well-being (social, economic and political) of those who are relatively advantaged" (Schatzberg, 1979, p. 174). Their development, he implies, would be detrimental to the rural poor because small towns and cities "are both centers of extraction that siphon off financial and human resources from the countryside and blockage points that inhibit the downward flow of resources as wel l ' (Schatzberg, 1979, p. 181). It is also claimed that rural people have limited access to farming innovations and that this lack of access makes small towns and cities ineffective dissemination points for innovation. Moreover, although farm people participate actively in town-based market trade, the urban traders who dominate the markets seek to maximize their profits and are uninterested in diversifying the agricultural economies in which market goods are produced. It is argued that 18 capital and credit are usually controlled by townspeople who prefer to invest in the towns and to lend to other townspeople who have more collateral, rather than to rural people who are perceived to be high-risk borrowers (Preston, 1978). A study of urban centers in Peru has indicated that the penetration of export industries and resource exploitation activities in the towns created greater dependencies on the national capital, and made life increasingly difficult for subsistence farmers in the rural hinterlands (Roberts, 1976). Critics warn that strengthening the linkages between small towns and cities and the metropolitan centers has made many rural workers redundant, undermined the network of local trading and petty production activities and weakened the economic structure of small towns, making them ancillary and dependent on the metropolitan economy (Roberts, 1976; Schatzbergs, 1979). For these reasons, Friedmann proposes a strategy of "agropolitan development" based on the creation of rural districts of about 50,000 inhabitants. The objective would be to create self- reliant rural economies, with minimal linkages to the metropolitan economy (Friedmann, 1980). Stohr and Todtling (1977) have suggested a variation of the strategy based on "selective spatial closure" as a way of protecting small towns and rural populations from backwash effect. A counter-argument is that small towns and cities per se are not necessarily parasitic; indeed, many perform the beneficial functions essential to rural development, as described earlier. Nor is the interaction with larger, more modern and economically diversified urban centers necessarily exploitative. Much depends on how the economies of small towns and cities are developed, and the ways in which the linkages between them and larger and smaller communities are organized. Once urbanization begins it is impossible to expect spatial closure. Leeds (1980) argues that no nucleated settlement can be closed, that its very existence even at a low level of 19 agglomeration is based on specialization, which in turn requires exchange. The author insists that "no town is an island onto i tse l f . The agglomeration of population in towns and cities is based on exchange and interaction: "for any locality, external connections are entailed. Theoretically, never should one expect to find autonomy, closure or boundedness. On theoretical grounds, one should always expect flows of goods, services, personnel, property, knowledge, information or possibly other values going in and out of any locality. The heart of this in and out is exchange— and the heart of human exchange is human strategizing ..."(Leeds, 1980, pp. 25-26). A good deal of empirical evidence suggests that small towns and cities can perform beneficial functions for rural populations. Not all of the interactions between urban and rural people are to the detriment of the latter, and although linkages with larger communities can bring profound changes to smaller towns and cities, in many cases they create new opportunities for the poor. In his study of highland towns in Bol ivia , Preston found that the negative impact of rural- urban linkages on some of the rural poor was usually minor, but that they also offered new economic and social opportunities to many others. He stated that the most important influence on agricultural innovation in highland Bol iv ia had been personal contacts among farmers and that those contact points were most often the tool shops in market towns. Farmers are "much more likely to be impressed by seeing large healthy new varieties of potatoes in the market rather than being told about them or even to some extent than actually seeing them growing" (Preston, 1978, p. 69). The degree to which market towns made new products available was crucial in disseminating agricultural innovations to their hinterlands. Moreover, he found little systematic or serious exploitation of rural people by market operators or merchants, nor did individuals or institutions in the towns seem to pose obstacles to capital accumulation by farmers. Preston concluded that "there is little feeling of injustice at the distribution of income" and that most 20 rural families could get access to some capital. Likewise, the negative effects of administration in the towns were, with the exception of a few individual cases, not a serious problem for farmers and municipal officials had indeed a good deal of popular support (Preston, 1978, p. 176-177). Other studies of market towns indicate that rural people can compete fairly with townspeople and that linkages between the towns and rural areas are the primary channels through which rural people derive income. Studies of marketplace interaction in the small Guatemalan city of Antigua, for instance, document the ability of rural people "to establish themselves as permanent market participants in competition with urban vendors, to obtain permanent rights in market space, to cope with hostile administrative structures and to form trading partnerships with urban customers." (Swetnam, 1978, p. 137). The very existence of the urban market in Antigua depends on linkages between the city and its rural hinterland, linkages that, in this case, seem to benefit rural residents as much as, i f not more than townspeople. A study of Dagupan City a medium-sized town in the Philippines showed that it has had strong trade relationships with the primate city, Manila, as well as with other towns and cities in its region. The study concluded that those trade and commercial linkages have not been detrimental to Dagupan's economic development, nor to those people living in the town's surrounding area. Sales penetration and contractual ownership penetration by large Manila-based firms changed but did not destroy local trade relationships. Instead, they stimulated local innovations in distribution and opened new employment opportunities. Dannhaeuser argues that trade with Mani la was one of the major factors that kept capital within the Dagupan region instead of being transferred elsewhere. The expansion of active marketing by Manila-based firms in Dagupan seems to have mobilized local capital and labor resources that had previously been idle. The expanded economic ties did not impose political dependency on the metropolis. Local 21 officials have levied high license fees for companies and taxes on salesmen doing business in the city, often to the dismay of the large companies (Dannhaeuser, 1981, p. 165). Richardson comes closer to the truth in pointing out that "neither the 'diffusion pole' nor the 'parasitic' views of the role of small cities are correct as a general rule. Much depends on how the functions of these cities have evolved with respect to their hinterlands, on the institutional and cultural features of the country in question and on how policies for strengthening the small cities are formulated and implemented" (Richardson, 1982, p. 14). A l l of this suggests that spread effects and beneficial interaction do not happen automatically as small towns and cities grow and diversify or as they are more strongly linked to other elements of the settlement system. Their economies and linkages must be structured to create benefits for their rural hinterlands and for the national economy. From their studies of growth poles in developing countries Misra and Sundaram conclude that "unless the new growth centers are planned as regional centers capable of serving the region they are located in, they cannot become instruments of modernization" (Misra and Sundaram, 1978, p. 170). Smaller towns must not only serve their rural areas but also be linked to larger centers that can support the wider array of services, facilities, infrastructure and inputs that are needed to promote agricultural development in rural areas. Roles and Functions of Small Towns: Evidence from Developing Countries Although the literature on small towns and cities in developing countries has grown so large in recent years that it is impossible to survey all of it here, samples can be cited to indicate the range and types of functions that these settlements perform. Examples of studies which indicate that small towns and cities in Latin America can perform important economic and social functions come from Mexico, Bol ivia , Honduras and Guatemala (Beals, 1975; Evans, 1982; 22 Hardoy and Satterthwaite, 1986). Small cities in Mexico—such as Oaxaca, which has some 100,000 residents—are important market centers for their regions (Beals, 1975). The market in Oaxaca, for example, provides outlets for agricultural goods, livestock, nonagricultural products such as fibers and firewood, and a wide variety of artisanal products—pottery, baskets, mats and household and agricultural implements. A n impressive array of people find employment directly or indirectly through market activities—carpenters, stonecutters, healers and curers, butchers, blacksmiths, small-parts sellers and marriage arrangers, mechanics and vendors. The market offers opportunities for farmers to sell their own goods and for a large number of intermediaries to engage in trade. Oaxaca supports traders who buy and resell goods within the market, traders who travel to small rural markets to collect goods for resale in the urban market, and traders who buy goods in the market and resell them door-to-door in town. The market offers opportunities for rural people to shop in stores located on the market's periphery and to visit doctors, dentists, clinics, lawyers and lenders. Wholesalers collect small quantities of local products in the Oaxaca markets and sell them in bulk to retailers in larger cities; they also buy manufactured goods in the city to sell in small lots back in Oaxaca. The city's market and other commercial activities provide employment for field buyers, agents, truckers and small-load haulers (Beals, 1975). Even very small towns in Mexico—those with 2,000 to 5,000 residents—support minimum basic services that are not available in rural villages: primary schools, medical doctors' offices, health clinics, pharmacies, gasoline stations, secondary schools, cinemas, restaurants, small banks, hotels and, in some places, dentists, lawyers, veterinarians and technical schools (Doherty and B a l l , 1971). Field studies of small towns in Honduras and Bol iv ia indicate that even in the poorest countries of Latin America, towns with average populations of 10,000 to 12,000 can provide basic health, agricultural supply, educational and commercial services. They are most important 23 as transportation and distribution centers and as markets for agricultural products grown in surrounding rural areas (Evans, 1982). The degree to which markets in small towns can facilitate and promote interaction between urban and rural residents is seen in anthropological studies of towns such as Antigua in Guatemala, where the bulk of trade is controlled by rural middlemen and where rural vendors travel long distances to participate in the periodic market (Swetnam,1978). Similar roles are played by small towns and cities in many African countries (Hirst, 1973; Funnel, 1976; Richardson, 1978; Wunsch, 1979; Haggblade et al., 1989; Baker, 1990; Pedersen, 1990). Small towns in Ghana—like Techiman, with less than 20,000 in population—are periodic market centers for their rural areas. Wunsch notes in his study of Techiman that trucks come on market day from as far a way as Kumasi, Tamale, and Accra, as well as from rural areas in Upper Volta, M a l i and the Ivory Coast. The town supports retail stores, schools, hospitals and a wide range of skilled and semi-skilled craftsmen, including physicians, nurses, tailors, carpenters, masons, mechanics, ministers and c iv i l servants. Larger towns such as Obuasi with a little more than 30,000 residents, have a wider range of agro-processing, marketing, service, commercial and informal sector activities. Moreover, Obuasi encompasses a population that is socially, religiously and ethnically heterogeneous. In the 1970s, it had more than 90 voluntary associations including religious, ethnic, occupational, trade, recreational, lodge, and secret societies (Wunsch, 1979). Studies in West Bengal, India, have revealed that rural towns with even as few as 5,000 residents can act as "minimal urban centers" for their rural regions (Corwin, 1977; Wanmali, 1985). These West Bengal towns are reported to: - serve as economic, political and cultural centers for the population of the villages in the surrounding rural micro region; 24 - provide the market where products not locally produced and specialized goods and services are available, and where local products may be sold; - provide the wide range of occupational specialists not usually found in rural villages, but necessary for the continuing existence of a primarily agricultural rural population; - serve as centers in which administrative and educational specialists representing the wider society and its urban centers meet and interact with the local rural population; - be characterized by extreme diversity in occupation and heterogeneity in population, regardless of their relative size as urban centers (as rural towns, such settlements exist to serve a nonresident population dispersed in agricultural villages); and - characteristically draw a large segment of the elite population from far outside the immediate locality, recruiting on the basis of education and experience in specialized administrative, professional and educational positions (Corwin, 1977, p. 39). In his studies of small central places in India, Johnson found that they are particularly conducive to commercial and industrial activities that cater to local, short-term market demands and that have a small potential number of customers who are within easy reach by foot, bicycle or other forms of transportation (Johnson, 1974). Thus, small towns in India frequently contain a wide array of small retail stores, personal and commercial services, and small cottage processing, fabricating or simple manufacturing operations. Those activities that cater to a small portion of a larger region can also be located successfully in small towns and cities i f adequate transportation and additional services are present. The most frequently found economic activities in Indian towns are weight-losing and bulk-reducing processing activities, such as sugar mills, saw mills, livestock slaughtering houses, canneries and oi l crushing mills. These localized activities in turn create demand for transportation and supply services, brokerage, storage, credit and insurance services. 25 Studies of rural industries in South Korea and Taiwan indicate that, in addition to supporting resource-processing activities, small towns and small cities are also good locations for small market-oriented activities such as animal feed shops, ice manufacturing plants, and production of clay building materials, earthenware, hand tools, and small concrete products. Medium-sized towns support a wider variety of services, including: commercial printing; motor vehicle repair; and small machine, galvanizing and metal processing shops. Simple assembly, mixing or finishing activities and separable manufacturing operations can also be efficiently located in small towns and cities, i f they have good transportation links with larger urban centers (Ho, 1980). In Southern Thailand towns from 14,000 to 57,000 in population provide health clinics, small hospitals, postal and district government services, elementary and secondary schools, small libraries, banks, bus services, telephone exchanges, and some types of vocational and higher education. Although few systematic studies have been done of the "influence" areas of small towns and cities in developing countries, estimates made in South Thailand indicate that the larger and more diversified centers—with median populations of about 33,000—have influence areas averaging 10,000 sq. km, and serve hinterland populations averaging 630,000. Such centers are linked to as many as 22 smaller and less diversified towns within their influence areas (Rondinelli, 1984). Studies of people who migrated from rural villages to small towns and cities in northeastern Thailand found their level of satisfaction high. Most migrants were able to increase their incomes and find better educational and health facilities than in their villages of origin. Although housing conditions in the towns seemed to be of lower quality, the studies revealed that migrants on the whole were "rather pleased with their new life in town", and that among those 26 who migrated voluntarily to small towns and cities "there is widespread satisfaction with the quality of life found at the destination" (Fuller, 1981, p. 92 and p. 101). Growth Centers and Rural Development In most developing countries, and especially in those of As ia and Africa, growth centers are located in rural regions (Appalrayu and Safier, 1976; Mabogunje, 1978; Southhall, 1979; Hinderink and Titus, 1988). The traditional view interprets their role as "parasitic", draining the rural hinterland of resources such as skilled labor and savings. However, from another perspective their location in rural areas could be viewed as a potential advantage, provided that policymakers can design growth center policies that capitalize on their important locational advantages. One such policy approach so is to promote a more appropriate industrial structure in the growth center. The standard industrial strategy is to develop large scale manufacturing industries which produce import substitutes with the aid of capital-intensive techniques. Experience has shown that this type of strategy is doomed to fail, at least as an instrument of spatial development. It creates an enclave pattern of development and suffers from limited market opportunities, too few jobs, and negligible diffusion of benefits to low income groups. A preferable, and more feasible, approach is to promote relatively labor-intensive agricultural processing industries which produce food (and intermediate materials) either for exports or the home market. The simple equation of agro-based industries with small firms located in rural areas is frequently erroneous, since many agricultural industries such as sugar and fruit canning are made up of relatively large-scale firms that need to locate in or near urban centers for labor supply and marketing reasons. I f the economic structures o f the pole and its hinterland are interdependent, this should facilitate the development of the intraregional road system (important 27 for agricultural marketing and commuting) and of hinterland-based supplying firms, both of which increase the probability of substantial "spread" effects. The location of a vigorous growth center in a rural region has other advantages. The emergence of a stable hierarchy of service centers may be critical to the efficient delivery of basic services, such as health, education, and social welfare, to the rural population. The provision of these services and accessibility to them may be a key factor in whether the rural population stays in rural areas or migrates to the large cities. The growth center w i l l very probably be the apex of this service center hierarchy. Promoting the growth center may bring into the region supply facilities for higher order services that are otherwise obtainable only outside (e.g., in the primate city). More importantly, the strength of the upper levels of the regional urban hierarchy may influence the stability of the settlement pattern in lower level centers, owing to such considerations as reinforcement of the transportation and communication network and firmer administrative control of service functions. The provision of more and better services is critical to raising rural l iving standards. In many developing countries, the rate of aggregate population growth remains so high that the potential land resources/labor ratio is not only very low, but falling quickly (Geertz, 1963; Lipton, 1977, 1982; Gilbert and Gugler, 1992). Thus it w i l l become increasingly difficult for the rural population to eke out a living from the land, and conditions of rural labor surplus are unavoidable. The implication is that off-farm employment opportunities w i l l have to be created, and it is an open question as to whether this should be attempted in villages or in accessible larger towns. The village approach is difficult to implement effectively and is, at best, only a partial solution. More urbanization is inevitable, whether planned or unplanned. Moreover, urbanization is the most clearly demonstrated instrument for reducing fertility rates. Successful rural development strategies may be little more than population boosters, with the additional 28 mouths more than nibbling away the gains from rural investment and improvement. If a planned urbanization strategy is chosen, a growth center component is desirable. A regional growth center's key advantage is that it offers an alternative destination to the primate city for rural- urban migrants. Since this alternative is located within the "home" region, the growth center may help to retain population in the region and enhance the possibility of easy return migration to the rural areas i f rural and village job prospects improve. If the migrant moves to the primate city, on the other hand, s/he is much more likely to be lost to her/his home region forever. These arguments suggest that the seeming contradiction between an emphasis on rural development and the existence of growth center strategies is more an illusion than reality. Only in very rare circumstances can the needs of the national population be satisfied via sole reliance on rural development. Furthermore, to use a growth center as an instrument of rural development implies promoting it in a different way than in the past. The historical precedents of heavily capital-intensive expansion, disfunctional enclaves creating intraregional core-periphery relationships, hinterland underdevelopment, and regressive income impacts are too obvious to allow expectations that growth centers w i l l stimulate the development of rural regions as a matter of course. Growth centers must be designed expressly for this purpose and implemented with great care. Agropolitan District In contrast to the growth center approach, there have been other suggestions on how rural areas might be developed. One of the more interesting ideas is that of the "agropolitan district" (Friedmann and Douglass, 1976; Friedmann and Weaver, 1979; Friedmann, 1980). Friedmann argues that growth centers imply an urban-industrial strategy. Instead, he suggests, elements of urbanism should be introduced into rural areas via the "cities-in-the-fields" approach, involving 29 the creation of a spatial unit namely the "agropolitan district" which is larger than the village. The agropolitan district supplies services, provides off-farm jobs, and is self-governing. Normally, it would have an average population density in excess of 200 persons per square kilometer, contain a core town of 10,000-25,000 with a commuting radius of 5-10 kilometers (walking or cycling distance), and have a total population of 50,000-150,000. Most of the labor force would be agricultural, but there would be some small-scale light industry, agro-processing and agro-supplying industries, and a variety of service activities. The functions of the district would be financed by retaining local savings, the substitution of volunteer work for taxes, the transfer o f capital from the primate city to rural areas, and changing the internal terms o f trade in favor of agriculture. The major difference between the agropolitan and the growth center approaches is that the former aims to resist urbanization, whereas the latter is ideally embodied within a national urban development strategy. The objections to the agropolitan district revolve around the issue of its feasibility. It would require far-reaching institutional and political reform. Since the key principle is self-governance backed up with sufficient financial resources, implementation would require communal ownership of landed wealth, land reform to rationalize holdings, and a reversal of the flow of savings from rural to urban areas. There is also the striking contradiction between the emphasis on participation and self-government at the local level and the authoritarian regimes that are so endemic in the developing world. It is difficult to foresee rich elites voluntarily giving up political power and wealth to permit the realization of some abstract spatial idea. Moreover, whereas a growth center strategy is very selective spatially, with the chances of success declining as the number of designations increase, the agropolitan district approach seems to call for an even scatter of a larger number of districts. In most cases the required network of a system of dispersed towns in the 10,000-25,000 range does not exist, and it is unclear how they would be 30 created—whether by selecting certain villages for expansion or by establishing new rural towns. These implementation issues have not been addressed by proponents of the agropolitan approach. Rural Central Planning The growing interest in rural central planning results from a renewed interest in rural development as part of a 'basic needs' strategy, with emphasis on the goal of greater equality in benefit distribution of the national development efforts. 'Basic needs' comprise not only social services such as education and health care, but also income (i.e., productive work) for the rural poor within and outside of agriculture, and better economic services (i.e., credit, agricultural input distribution and marketing). This renewed emphasis on rural development comes from many administrators, economists, sociologists and others realizing that the old axiom in economic theory about automatic 'spread effects' in development is no longer tenable in developing countries, in the light of much concrete evidence during the past two decades ( U N , 1979). While per capita income in developing countries has grown, the number o f poor has also grown and their income has decreased. Polarization and growing income gaps between rural and urban people have resulted. According to the U N , development strategies in developing countries have centered on rapid industrialization and urban development (United Nations, 1979). There is no dearth of policy statements extolling the merits of rural development, yet in practice it remained a low priority, as the budgets of many countries show. The allocations for agricultural research and extension, for instance, are invariably low. The same holds true for social and other economic services for rural areas, e.g., infrastructural development. 31 The neglect of rural development has become apparent. Mass migration to "primate' cities has produced desolate slums. For every newly created urban job, several rural unemployed migrants come to the city, necessitating further expenditures on housing, infrastructure, and services. Nonagricultural production has increased, but per capita food production has stagnated despite the "Green Revolution.' Governments have had to spend scarce foreign currency to import foodstuffs (which could have been produced locally) rather than to purchase much needed machinery, spare parts and industrial raw materials (United Nations, 1979). Rapid population growth in cities is certainly both a consequence and a major contributing factor to the stagnation of rural growth. The benefits of increased productivity have been virtually overtaken by the growing number of mouths to be fed. Nevertheless, to blame population growth alone for the present unsatisfactory state of affairs is too easy and offers only a partial explanation. After all , per capita income has expanded. The problem is much more one of unbalanced (sectoral) growth and a skewed distribution of the growth's benefits. The literature discussed above indicates that linkages of rural areas to urban areas can be identified via some main variables. One variable is population mobility from rural to urban areas. These people are mostly landless laborers in rural areas and they move to urban areas looking for jobs. Because their skills are mostly related to agricultural activities, it is difficult for them to find jobs in urban areas. The jobs available in urban areas are primarily related to manufacturing and services activities. Therefore, the majority o f migrants become involved in informal sector activities in urban areas. The literature also indicates that migrants quite often send money to their families left behind in rural areas. The remittances sent from urban areas are often invested in opening small shops, improving their housing or buying land in rural areas (Hugo, 1981; Firman, 1994). Thus, capital flows from urban to rural areas via remittances (or money which 32 they bring back when they visit their families in the villages) have significant impacts on economic activities in rural areas and rural development in general. Other linkages between rural and urban areas are with regard to production. The majority of agricultural commodities produced in rural areas are sent to markets in urban centers where most of the consumers are located. Many rural people visit markets located in rural or urban areas to buy manufacturing goods (which are produced in urban areas) such as clothing, soap, and cigarettes. Thus, it is clearly indicated that rural-urban linkages occur not only via the flow of migrants and agricultural products from rural areas to urban areas, but also through the flow of remittances and manufactured products from urban areas to rural areas. The Impact of the Green Revolution and the Process of Rural Change After the first decade of the Green Revolution and its new rice technology based on High Yielding Varieties ( H Y V ) , many scholars concluded that the fruits of this agricultural intensification would be enjoyed mainly by large landowners (Sayogyo and Collier, 1973; White, 1976; Sayogyo and Wirandi, 1985). Consequently, it was argued that development would take place largely at the expense of the landless (Antlov, 1986). There were many studies showing effects on the overall agricultural employment situation and especially on aspects such as the harvest ( Stoler, 1977; Collier, 1981; Husken, 1984). Unt i l the introduction o f the H Y V s , the harvest had been open, meaning that everybody who wished to could participate and in return get a share of the harvest. In particular, it was an important source of income for many landless women. This was replaced by a more efficient closed harvest system in which only a limited number of precontracted male workers were allowed to participate. The harvest is only one of several aspects in which the poor, and especially the landless, were found to experience a deteriorating situation as a consequence of the Green Revolution. 33 With rapidly increasing yields and the subsequent commercialization of agriculture, the rich could invest much of their surplus in extensions to their large land-holdings. Land become concentrated in fewer and fewer hands, a process which would further widen the gap between rich and poor. Other arguments mainly focus on the Green Revolution's insufficient contribution to broader aspects of rural development. First, the concentration of efforts on rice production has had a negative impact on the area,under secondary crops, especially those grown in irrigated fields, commodities such as maize, soybeans, groundnuts and cassava. Second, it has been argued that the various programs did not improve the position of the very small and landless farmers (Tjondronegoro, 1991). Credit was not provided to them for lack of collateral, and the commercialization of production relations often decrease an agricultural laborer's opportunities to earn a cash income. Third, the policy discriminated against farmers who didn't grow rice, mainly those situated in the upland areas and drier parts of the country. Thus the programs did not only fail to alleviate the positions of certain social groups, but also left out certain areas. In retrospect, however, the Green Revolution provided most rural groups with new opportunities, with derived benefits varying considerably. Based on my interviews with rural people in Dumoga Subdistrict, it seems fair to conclude that although most groups are better off now than some twenty years ago, the gap between rich and poor has further increased. There is a small group of commercially minded farmers who have benefitted the most, many of whom had large resources at their disposal. Those who have profitted have invested their surplus by buying more land. Through the expansion of state expenditures, the economic standing of c iv i l servants has also grown rapidly. In the four villages under study, the main advantages of this development have been reaped by subdistrict officials, c iv i l servants who are working in education, health, and 34 agricultural services located in the subdistrict, and some village officials, who are now among the village wealthy. Another small group of villagers has been able to take great advantage of the increasing government expenditures in rural areas. These are the entrepreneurs in the construction sector who have been able to secure contracts for various local government-sponsored building projects, such as for construction of roads and bridges. Such entrepreneurs have made huge profits, part of which they have invested in land, but they have also been used to finance other nonagricultural investments. Through their activities, these entrepreneurs have been able to provide a large group of villagers with nonagricultural occupations. Although these entrepreneurs are a very limited group, they have been an important and dynamic force in the diversification of the village economy. After more than three decades of development, rural areas have experienced numerous changes. The changes have occurred both in agricultural and nonagricultural production, employment structure, income opportunities and social structure. Various rural development policies that have been taken by both central and local governments have played a significant role in influencing the process of change throughout the country. Such policies are directly aimed at the agricultural sector, and strive to improve physical infrastructure, increase rural income by enlarging rural employment opportunities, and also intervene in social service provision to upgrade the l iving conditions in rural areas. There are numerous studies which analyze the impact of agricultural production programs on rural employment and income distribution (Collier, 1978, 1981; White, 1976; Jones 1984; Kasryno, 1986; Manning, 1988). The studies indicate that the agricultural development and its related policies have been accompanied by complex changes in the rural employment and income conditions. Furthermore, the findings indicate that there were great differences in impact— 35 between regions, within region, and between households. It is important to note that the early studies (during 1970s) were often rather negative on employment and income effects of technological innovations. On the other hand, the later studies (done in the 1980s) have shown that in general the Green Revolution has had a positive impact on rural employment and income. A study done by Kasryno, (1986) analyzing 1980 census data, indicated a shift in youth employment (those in the 10-29 age group) out of agriculture, implying the start of intergeneration mobility of labor on Java away from farming. There were other interesting developments and trends in rural employment and agricultural incomes. Based on microstudies, Kasryno found that in the period 1977-1983 the relative share of income from all farming-related activities remained largely unchanged, while the component of farm labor income declined from 42 percent to 28 percent of total income. This process was accompanied by an increase in income generated by off-farm employment, which rose from 12 percent to 23 percent of the total income. A study done by Manning (1987) confirm this increasing importance of the nonfarm sector for the income of rural households. Kasryno's data show a total rural income increase over six years, rising by approximately 11 percent per annum. This indicates improvements in productivity of both off-farm employment and on-farm employment. In analyzing various data sources, Manning (1988) found that the rapid growth in rice output has been accompanied by some increased employment in agriculture. He argued that this was especially related to the relative absence of mechanization in Indonesia. Similar findings by Jones (1984) suggested that increased public spending in rural areas has been more important for the employment situation in rural areas than agricultural growth. The spin-offs from activities related to public spending appeared to have greater impacts on the service and construction sectors rather than to manufacturing. In addition, although many of these new, nonagricultural 36 jobs have been created in the urban areas, generally rural households also benefitted through circular migration. Aside from the above views, there is a notable change on the labor supply side. Increased education and job opportunities in the nonagricultural sector have changed rural people's perceptions about agriculture and rural areas. A greater flow of information about modern life through television and the mass media stimulates the desired for better jobs, life styles, expectations and l iving conditions. In the last two decades a large portion of young laborers have shifted from the agricultural sector to nonagricultural sectors (Gunawan, 1993). However, this phenomenon is not an indicator that nonagricultural sectors have generated sufficient employment opportunities, because most migrants from rural areas enter the urban informal sector. They are economically unstable, insecure, and among the lowest income earners in the city. Therefore, they are expected to return to the village at retirement age (Hugo, 1981; Gunawan and Zulham, 1992). Rapid movements of rural and agricultural labor to urban areas are partly due to strong pull effects of the urban sector. Some studies indicate that high urbanization has been strongly motivated by substantial differences between agricultural and nonagricultural wage rates, and the perception that nonagricultural jobs are more interesting and satisfying for young, more educated rural people (Castello et. al. 1987; Saefullah, 1994). The rural to urban flow is not necessarily due to an unavailability of agricultural jobs in rural areas. The movement of young and educated villagers to urban areas is not simply because of economic reasons; there are social and psychological aspects which induce migration. 37 Transmigration Program or New Land Settlement New land settlement can be categorized into three types (Nelson, 1973: p.73). First, there is directed settlement, characterized by a high degree of government control over settlers with respect to: size and location of farms and land clearing; resale of land; crop choices; management practices; credit availability; eligibility for land; cooperative organization; and the settlers' contributions of time to communal activities. The second type is spontaneous settlement, made by individuals or small groups without government assistance, sometimes in the wake of forest exploitation, sometimes in advance of government investments in the area, and sometimes simply by clearing a small part of government-owned forest. The third type, semi-directed settlement, involves specific government investments and programs of assistance to spontaneous colonists in the region that is in the consolidation stage of development. Based on the above classification, it can also be said that directed settlement is an instrument of three kinds of policies. First, in Nelson's view, directed settlement is an instrument of natural resources development policies, and specifically of land development policy. In this view it is taken in connection with the determination of the internal rate of return of the investments made in directed settlement projects, especially in countries that need loans from agencies such as the World Bank or bilateral donors. Second, directed settlement can also be seen as an instrument of policies that aim to relieve tensions in densely populated existing settlement areas. In some countries, the agency in charge of land reform is also responsible for the execution of settlement projects, (i.e., i N C O R A in Colombia, I E R A C in Ecuador, O N R A in Peru, and the Ministry of Transmigration in Indonesia). Third, settlement objectives may be related to geopolitical concerns. A number of projects have been executed in frontier areas in order to safeguard territorial integrity, for example, the Caqueta development in Colombia and the 38 movement of large numbers of Javanese and Balinese migrants to West Kalimantan and Irian Jaya (West New Guinea) in Indonesia. Such resettlement also plays a role in nation-building. Spontaneous settlement is enhanced by directed settlement. Settlers w i l l locate in the vicinity of such projects as well as near other types of natural resource development which imply the construction of penetration roads. Spontaneous migrants w i l l occupy land on either side of such roads, and w i l l also proceed along rivers, expecting the facilities under construction there to give them more opportunities. They leave their villages for reasons such as poverty, land shortage, crops failures and other natural disasters such as droughts and earthquakes. Consequently, spontaneous settlers are normally found around new settlements that receive support from the state and near infrastructure also provided by the state. Thus, government exerts an important influence on the geographical choices taken by the "spontaneous" settlers. In Malaysia great numbers of settlers have been moved from the northern and western states of peninsular Malaysia into its two eastern states. Under the guidance of regional development authorities created by federal legislation, rubber and oi l plantations were established with the necessary processing plants. The factories have their own acreage of plantation trees plus some land for workers' subsistence crops. Technical assistance and marketing are provided by the estate's personnel and prices are set by the central authorities. Settlers receive their land with a dwelling and have to pay back a large part of the cost of their resettlement through annual payments. The Indonesian situation is rather different in that the official transmigration programs suffer from serious logistical problems, such as inputs which often do not arrive in time for the first season's crop; a main crop that has been selected but is not always adequate to the survival needs of the settlers; and sites which are often ecologically unsuitable and poorly connected to markets (making it difficult for settlers to obtain cash income). In most cases the land used for 39 resettlement is perceived by local people as their own, so tensions emerge between indigenous or local people and the new arrivals (Colchester, 1986). In addition to the official transmigration program in Indonesia, there are also a great number of spontaneous settlers, who might be termed pioneers. They operate as individuals or small groups and their general performance appears to be much more successful than that of officially resettled people (Hardjono, 1977). The Indonesian transmigration program is under considerable international pressure to be reviewed or even abandoned, partly because of the program's political, human rights and ecological aspects, and partly due to its high cost per settler. The loans which the government has undertaken to finance transmigration efforts weigh heavily on the national budget, especially since oi l revenues have fallen. A study by Nelson (1973) of 24 projects in Latin America concluded that directed settlement is not an adequate instrument of land development policy. The internal rates of return required for bankable projects relied upon too many unrealistic assumptions regarding the quality of the government services provided and the nature of the settlers. Nor could directed settlement serve as a means to solve problems such as population pressure in existing/established rural settlements, since the amount of resources required would be far greater than the means which governments have available. In the face of these conclusions, sponsors have started to withdraw from policies of directed settlement, while the numbers of spontaneous settlers keep increasing. Instead, governments have started to provide services and infrastructure to spontaneous settlers in centers of certain size and not too far removed from main roads already in existence. This trend is also apparent in the older transmigration areas in Indonesia. 40 Conceptual Framework Small towns (district capitals in the Indonesia context) and rural centers (subdistrict capitals) perform a variety of roles in national development. They are tools for achieving a balanced distribution of the urban population. They promote and support rural development, and provide functional linkages between rural and urban areas. In some countries they play major roles in the decentralization of economic and social activities. The definition of small towns varies from country to country, but their size is usually somewhere between that of a regional city and a rural center. The majority are directly the result of agricultural and rural development. Some serve special purposes such as mining and tourism. Small towns in many countries have experienced a decline in their roles as the service centers for their hinterlands. Improvements in all aspects of transportation and communications and the introduction of modern strategies of organization and development in both the private and public sectors have considerably increased the role of the big cities and metropolitan centers, resulting in out migration from rural areas. In addition to the well-known "pul l" factors attracting rural out migrants to the large cities, there are also "push" factors such as inadequate marketing systems, uneconomic prices for agricultural products, manpower redundancy caused by mechanization and the Green Revolution, and (sometimes) inequities in landlord and tenant relationships in the use and development of agricultural land. The negative effects of this out migration to the large cities are evident in the formation of squatter settlements and overcrowded, expensive housing. Studies of the role and function of rural centers and small towns, and of the linkages of small towns and rural centers in rural development attracted the interest of many scholars and researchers during the two decades prior to the mid 1980s. Since the late 1980s little attention has been given to the study of rural-urban linkages and development. Instead, the study of big cities has dominated recent academic discourse. However, the phenomenon of globalization is 41 affecting not only big cities or urban areas, but also more remote areas, such as rural areas and rural centers. It is expected that today's wave of globalization and internationalization, with its consequences in the areas of technology and communication, may also influence the linkages between rural and urban areas. Concerns about the high growth rates of metropolitan cities and the accompanying deterioration o f the quality o f life have been expressed in many scholarly and popular publications. Since Indonesia is predominantly agricultural and more than 70 percent of the population lives in rural areas, small towns play crucial roles in providing the economic, physical, social and cultural bridges between the regional cities and rural areas. In the development of rural areas, small towns and rural centers need to be strengthened to act as sites for exchanging agricultural and industrial products and for providing nonagricultural employment opportunities for the surplus or under-employed agricultural laborers. Deliberate planning of small towns and rural centers is necessary within a well- articulated system o f service centers to form a framework for successful implementation of rural development strategies. The planning and development of small towns, rural centers and programs for rural development should be integrated, preferably within a framework of regional planning and development in which the responsibilities of the various agencies of the national, provincial and local governments are well-defined. The regional level is probably the ideal level at which the proper integration of physical, economic and social planning can take place. The key to the role of small towns and rural centers in developing countries lies in the state of rural development. The success of integrated rural development depends on a proper institutional framework which could ensure public participation in planning, decision-making, implementation and evaluation. This implies the inclusion of a bottom-up approach in planning and a policy which promotes self-reliance in rural areas. 42 The studies reviewed above address the relationships between rural and urban areas through economic, social, and physical factors and through the analysis of the linkages between the rural and urban as two separate entities. In many cases, the studies emphasize the role of the small town in rural development by focusing on its relationship to the rest of the urban hierarchy. However, there is a dearth of studies which deal with the government policies which affect these relationships. There is also a lack of studies which examine how such factors affect rural development. It is necessary to view the rural-urban relationship from the rural perspective, and then to comprehend its linkages throughout the urban hierarchy. Given the lack of studies of the linkages between transmigration villages and urban areas, it would also be useful to ascertain how such linkages compare to those of nontransmigration villages. What is needed for understanding rural- urban linkages is a complete picture, which allows us to examine variables in such categories as economy, migration, services, infrastructure, technology, and political administration. Finally, data for all such variables in the broader picture of rural-urban linkages must be interpreted through regional development and planning perspectives. Having surveyed the theoretical literature and empirical studies which discuss the most important linkages between urban and rural areas, and based on my observations in the study areas, it is possible to develop a conceptual framework of rural-urban relations and rural development. The conceptual framework simplifies the very complex real situation of rural- urban relations and can be used as a guideline for field work in order to achieve the goals of the study as proposed earlier. The conceptual framework in Figure 1.1 depicts two kinds of rural settlements: transmigration villages and non transmigration villages. The urban areas in the diagram are classified according to their administrative functions, with the capital city of a subdistrict as a 43 rural center, the capital city of a district as a small town, and the capital city of a province as a medium city. Figure 1.1 shows how transmigration villages and non transmigration villages have different patterns linking them to the urban hierarchy. Transmigration villages have strong linkages to medium cities and other big cities and regions (as indicated with thick lines). These linkages are associated with market places, schools, hospitals, and visit to the migrant's place of origin. Linkages between transmigration villages and small towns are relatively weak (as indicated with thin lines). These linkages are mostly related to market places, schools, and health clinics. Linkages between these villages and rural centers are very weak (as shown with a dotted line). These linkages are limited only to people visiting rural centers for administrative matters dealing with subdistrict government. On the other hand, non transmigration villages have strong linkages to rural centers (as indicated with thick line). These linkages are associated with market places, and administrative matters dealing with local institutions. Their linkages to small towns are relatively weak (as indicated with thin lines). These linkages are related to market places, schools and health clinics. Their linkages to medium cities are very weak (as indicated with a dotted arrow line). These linkages are because of those few rich nonmigrant farmers who visit medium cities for education, health, and shopping. Non transmigration villages have no linkages to other big cities and regions. The Figure 1.1 also indicates that non transmigration villages and transmigrant villages have linkages via local people visiting markets located in transmigrant villages or migrants who visit markets located in nonmigrant villages. This framework shows how the rural-urban linkages can be explored through the following main sets of variables. 1. (E) the economic variables are the most common variables used to analyze the condition of communities or households in a certain area. In this study, a number of economic variables w i l l be examined. For example, "production" is related to villages' production o f rice, crops, and 44 l ivestock. " M a r k e t i n g " is related to where and to w h o m rural people send their products; and h o w and what k i n d o f goods and urban products are marketed to rural areas. " C o n s u m p t i o n " relates to rural people ' s expenditures on both goods produced i n rural areas and i n urban areas. " Income" requires analysis o f the sources o f rural people ' s income. " C a p i t a l f l o w s " are related to the money sent or f l o w i n g to urban areas or other regions, and the capital i n f l o w received i n rural areas f rom afar, such as remittances. 2. ( M ) the variables o f migra t ion include "rural-urban migra t ion" , such as when rural people move to towns or cities to f ind temporary jobs i n off-farm employment . Another variable o f " soc ia l interact ion" is related to the frequency w i t h w h i c h rural people v i s i t their famil ies or attend socia l or re l igious ceremonies i n towns. 3. (SD) the service de l ivery variables cover the l inkages o f rural communi t ies to f inancial and credit faci l i t ies, education, and health services del ivered by both pub l i c and private sector. 4. (PI) the phys ica l infrastructure variables i nvo lve the transportation networks w h i c h serve as channels between rural and urban areas. A n example are transportation facil i t ies available for use by people i n rural communi t ies to connect w i t h other areas. E lec t r i c i ty networks available i n rural areas, and i r r igat ion networks located i n rural areas as the m a i n infrastructure for watering rice fields are other variables. 5. (T) the technology variables cover the l inkages o f rural communi t ies to communica t ion and informat ion related to general information, agriculture and health. The rural-urban l inkages inc luded i n these sets o f variables are examined i n the context o f the case study vi l lages i n Chapter F i v e . 6. (PA) the po l i t i ca l administrat ion variables i n this study include central and p rov inc i a l governments ' budgetary f lows to loca l government and rural development, and the structural relationships o f government hierarchy f rom central to v i l l age government. The po l i t i ca l variable 45 is also related to organizational interdependencies, such as village government, village institutions (village council, farmer groups, and non government organizations). The informal political decision chains relate to the role of informal leaders in acting as channels between the rural community and local governments. However, many of these variables are also directly affected by government policies. Thus, such policies and their means of implementation should also be analyzed. Following an overview of the case study area in Chapter Two, these policies are examined in detail in Chapter Three. Chapter Four and Five present the case study findings with regard to the comparison between migrants and nonmigrants and rural-urban linkages. Chapter Six and Seven give an in-depth analysis of how these rural areas are effected by the administrative system and the planning process. Chapter Eight summarizes the main findings and discusses implications for policy. o a « 73 s a W a o U 9) U 3 OJD U 3 .5 O C *» O o s = c 0 a> u S £ s o e 0 s o " * O 1- — a> £ - ^ ~ ^ '5. £> -fa « U W Q 5 S-i o o S a o > Q 13 u s OS -o « C a C5 S- P 1 13 s- 3 o o o o o o IT) IT, ii > •3 2 s a "3 n, o 46 .2 £ c >̂ <D 0 0 11 .2 12 Q ? b M M P • 1—1 CO O S t; FT -2 a m S g o u ^ 3 O „ • Sr1 O 3 o u M bO M 3 s o 2 CQ +-» M O T3 2 •-, 'DO P-i .2 o a o a W '-3 < i-i " U ^ *2 o S -2 0 d 1 3 . rj_, M u „ 0 U x T O o 13 c °^ o o bo K '-s .a •a | g § I J o > ^ rt •3 ^ s, S D 2 H 5̂ o II <U II (U W Q h ^ 47 CHAPTER TWO THE RESEARCH PROCESS AND DESCRIPTION OF STUDY AREAS Introduction The purpose of this chapter is to explain in detail the research method applied in this study. This chapter also provides information about the setting and conditions which have affected the population of both local people and transmigrants. The characteristics of the four study villages are also defined. The study is based on a combination of explanatory research and descriptive research. The former is research related to generating explanations which focus on the analysis of relations among the variables being investigated. The latter describes in detail specific social phenomena in the communities under study, in an attempt to explain the relationships among some social phenomena. The first section of this chapter describes the method of choosing study areas, household sampling, data collection, and method of analysis. The second section provides information about the setting and conditions which have affected population, both local people and transmigrants, and defined the characteristics of the four study villages. The chapter's third section discusses the national and regional contexts, and is followed by a discussion of Bolaang Mongondow District, Dumoga Subdistrict, and the four study villages. Finally, it is also necessary to elaborate on the setting and conditions of the capital city of Dumoga Subdistrict, the rural center called Imandi; the capital city of Bolaang Mongondow District, the small town called Kotamobagu; and the capital city of North Sulawesi Province, the medium city called Manado. 48 The Method of Choosing Study Areas North Sulawesi is one of the many provinces outside the islands of Java and Bal i that has become a destination area for transmigrants sponsored by the central government. In 1963 part of Dumoga subdistrict's area was designated by provincial and local governments as a location for the first group of transmigrants from Ba l i to locate in North Sulawesi. In the early 1970s groups of transmigrants from both Java and Bal i followed. With a settlement history of more than 20 years, it is possible to study and analyze the differences between transmigrant villages and nontransmigrant villages' linkages to rural centers and small towns. Another reason for choosing North Sulawesi is that most studies of urban-rural linkages in Indonesia have focused on Java. There has been only very limited attention given to the nature of rural-urban linkages in the regions outside Java. A n important consideration in this study was how to decide on the criteria used for choosing study areas or selection of villages. Selection of particular study sites was conditioned in part by the experiences and background of the researcher and the locations of the places to be studied. A t the beginning of the project, an observation of each village was carried out. Officials at the District Bureau of Statistics and the District Development and Planning Bureau were contacted in order to obtain data, reports, maps, and to elicit help in gaining the confidence of local leaders and residents in the selected survey areas. Field observation and analysis of secondary data allowed the researcher to determine the village's characteristics and also to determine which villages were dominated by local people and which by transmigrants. A number of researchers have stressed that different types of agriculture involve different forms of production with concomitant variations in patterns of social relations (Paige, 1975; Friedman, 1980). The forms of agricultural production in North Sulawesi can be classified into three types: plantation agriculture, dry season crops (palawija), and the predominant wet rice 49 (sawah) cu l t iva t ion . These categories are based not only on the type o f crops grown, but also on the socia l relations o f product ion associated w i t h each form o f product ion. The first o f these forms is the most commerc ia l i zed , wh i l e the second type is the least commerc ia l i zed . In D u m o g a subdistrict, there is on ly a very smal l propor t ion o f the popula t ion active i n plantat ion agriculture. A large propor t ion o f v i l lages , however , depend o n the seasonal r ice crop. Therefore the sample popula t ion w i l l inc lude on ly those vi l lages i n w h i c h the predominant types o f agriculture are wet rice cul t iva t ion and dry season crops. The f o l l o w i n g cri teria were developed i n order to chose four v i l lages i n N o r t h Sulawes i as the m a i n case study, and three vi l lages i n Centra l Su lawes i as a complementary case study. 1. The v i l l age ' s m a i n products are r ice and crops (such as corn , soybean, peanut, cassava, and other vegetables). 2. E a c h v i l l age under study must be o f the same approximate distance to its corresponding rural center, sma l l t o w n and m e d i u m ci ty as the other study vi l lages are to theirs. 3. A c c e s s i b i l i t y and road condit ions to the vi l lages must be relat ively easy and good. 4. Because one o f the study's a i m is to investigate differences i n the l inkages and impacts o f rural development o n transmigrants vs . l oca l people, two transmigrat ion v i l lages and two non-transmigration ( local people) v i l lages i n N o r t h Su lawes i were chosen, and two transmigration v i l lages and one non-transmigration v i l l age i n Centra l Su lawes i . The select ion cri ter ia above for the case study areas are detailed i n Table 2 .1 . Based on the criteria above and a month o f observation i n the f ie ld , four v i l lages were chosen as a m a i n case study i n N o r t h Su lawes i : two non-transmigration v i l lages (al l l oca l people), D o l o d u o and D o n d o m o n ; and two transmigration v i l lages (al l migrants), M o p u g a d Selatan (wi th a l l transmigrants o r ig ina l ly f rom B a l i ) and M o p u y a Selatan (transmigrants most ly or iginat ing f rom East Java). F o r the three vi l lages i n Centra l Su lawes i , T i n d a k i was chosen as the 50 non-transmigration village, and Purwosari (mostly transmigrants from East Java), and Tolai (dominated by transmigrants from Bali) as the transmigration villages. Table 2.1 Characteristics of the Villages Distance to Ma in Status Road Province and Production Condition Village R C ST M C Rice Crops Transmi Nontrans- (km) (km) (km) -gration migration North Sulawesi: Doloduo 16 53 237 X X X good Dondomon 14 51 235 X X X good Mopugad Selatan 21 58 242 X X X good Mopuya ' Selatan 19 56 240 X X X good Central Sulawesi: Tindaki 23 103 103 X X X good Purworejo 28 108 108 X X X good Tolai 32 112 112 X X X good Note : R C = Rura: Center, ST = Small Town, M C = Medium City Doloduo Village and Dondomon Village are known as two of the oldest villages located in Dumoga Subdistrict. Both villages are dominated by local people called the Mongondownese. A s agricultural villages, the main production is rice and some crops. Because of their fertile land, farmers can produce rice two times per year, or sometimes three times in a two-year span. The people of Mopugad Selatan Village are mostly Balinese and, Mopuya Selatan Village is dominated by Javanese. Both villages are known as transmigration villages, among several located in the Dumoga Subdistrict or Dumoga Valley. These two transmigration villages produce mainly rice, some crops and vegetables. They can harvest rice two times per year or three times in a two-year period. 51 Ethnicity is another criterion for choosing the villages sampled in the main case study, because of the assumption that ethnicities have a strong impact on people's links to rural centers, small towns, and medium cities. This study selected three ethnic groups, namely, Mongondownese (the indigenous people), Balinese, and Javanese. Both the Balinese and Javanese in this case study moved to the Dumoga Valley between 1974 to 1976. Most of the rice fields located in these four villages are directly connected to irrigation systems. A l l villages are connected to an asphalt road in good condition and serviced by mini buses which run to rural centers and small towns. The mini buses are operated as private enterprises. One big bus, organized by the provincial transport department, runs once a day from Doloduo to the medium city (Manado) the capital city of the province. The distances from the four villages to the rural centers, small towns, and medium cities are relatively similar, as Table 2.1 indicates. Household Sampling In Indonesia, a village register of households is kept by village officials. The register provides basic demographic information about all residents. This information is used as the basis for village statistical reports and as a record of population to be enumerated in the decennial census. Therefore, the registers are most accurate at the time of the census which is when they undergo extensive updating. In the four sample villages in North Sulawesi and the three villages in Central Sulawesi, the registers were organized in the same way. Household members were listed together, with the first entry being the household head. Almost all information was available on the age, sex, and religion of each of the household members. Other information, such as details of main occupation, schooling, literacy, and ownership of specific types of consumer goods was also sometimes available. 52 When a register was deemed suitable for use as a sampling frame, the register was updated using information available from the heads of each neighborhood (dusuri). From the updated register, a sample of 239 households and 60 respondents was drawn including village officials, informal leaders, elders, planners, politicians and entrepreneurs in the four villages, rural center, small town, and medium city of North Sulawesi; and 49 households and 35 respondents including village officials, informal leaders, elders, planners, politicians and entrepreneurs in the three villages, rural center and medium city of Central Sulawesi. Details on the respondents interviewed during the field work are shown in Table 2.2. The sampling method used was systematic sampling with a random start. After the initial sample selection, a further systematic sample of 3 households from the original survey of each village was undertaken. These 3 households were to serve as replacements if, for any reason, it was not possible to contact sampled households. Table 2.2 Total Respondents Interviewed Province and Household Village Informal Lea- Planner Politician Entrepre- Village Official der and Elder neur North Sulawesi: Doloduo 76 2 4 - - 1 Dondomon 52 2 3 - - 1 Mopugad Selatan 56 2 3 - - 1 Mopuya Selatan 55 2 3 - - 1 Rural Center - 2 6 2 1 2 Small Town - - 3 3 2 4 Medium City - - 2 3 3 2 Total 239 10 24 8 6 12 Central Sulawesi: Tindaki 16 2 3 - - 1 Purwosari 16 2 3 - - 1 Tolai 17 2 3 - - 1 Rural Center - - 2 1 - 2 Small Town - - 2 2 1 2 Medium City - - 2 2 1 - Total 49 6 15 5 2 7 Total respondents 288 16 39 13 8 19 53 Data Collection and the Questionnaire The first period of field work took place in North Sulawesi and Central Sulawesi for five months between October 1995 and February 1996. The second period of field work took place in North Sulawesi for two months during December 1996 and January 1997. The primary data were gathered through the use of questionnaire surveys. The core instrument for these surveys was developed in September 1995 after preliminary field interviews and discussions with researchers working at the Institute of Management and Development Studies, Economics Faculty, Sam Ratulangi University, Manado. Each household questionnaire consisted of five sections. The first section asked for information from the head of household related to age, education, place of birth, marital status, number of children, number of family l iving in the same household, and the nature of the relation between each family member and the head of household. The second section was directed towards gaining household information. Information was gathered from the head and spouse on their employment histories, ownership, housing as well as socioeconomic and demographic characteristics. The third section of the questionnaire asked about their main production, cost of production, marketing, consumption patterns and capital flows. The fourth section sought information about the family linkages to other villages, rural centers, small towns, and medium cities, or their commuting patterns (e.g., journey-to-work, education and health facilities, bank, cooperatives, and market). The final section of the questionnaire asked the head or spouse questions about their perceptions regarding rural development (including transmigration programs), terms of trade, job opportunities, their participation in planning processes and development, government policies on rural development, and the environment. 54 The questionnaire for village officials, informal leaders, elders, planners, and politicians consisted of 16 open-ended questions designed to elicit opinion and identify issues regarding the following: implementation of rural development programs, participation of community in planning processes and development, the role of rural centers and small towns in rural development, the role of local government on rural development, and central government policies to strengthen local governments and community participation in development. On average, about two hours was needed to interview the household and less than two hours to administer the questionnaire for village officials, informal leaders, elders, planners, and politicians. Interviewers were carefully selected and received training from the Department of Economics and Development Studies, Economics Faculty, Sam Ratulangi University. Eight interviewers (5 females and 3 males) were recruited. The interviewers were primarily from rural backgrounds. One could speak Javanese, another could speak Balinese, and some others Mongondownese. A l l were students who had prior experience in conducting social science survey research, and all underwent an intensive training concerned with the survey instrument and the purpose of the study. Household interviews were held either by visiting in the house early in the morning while the respondents ate breakfast or in the evening after dinner, or in the rice field during lunch break. Every evening after the day's work of collecting information from households was completed, all interviewers met with the author to discuss any problems arising from the respondents and to seek solutions together. In North Sulawesi, questionnaires were administered between October 7, 1995 and November 25, 1995. In Central Sulawesi, questionnaires were administered from December 1 to December 20, 1995. A l l interviews were conducted in Indonesian language {Bahasa Indonesia). 55 The cooperation from respondents was excellent. For instance, in North Sulawesi there were only 6 refusals from potential respondents, and in Central Sulawesi only 2. In brief, the field work was divided into the following four stages. 1. The first step was a reconnaissance phase to observe and select the villages to be chosen as case studies. The first phase also included a pilot study in a village not included in the sample, in order to pretest the questionnaire. 2. The second step included initial interviews with households in the four villages, and in-depth interviews with village officials, informal leaders, and elders. A t this stage, secondary data were also gathered from the village office. 3. The third step consisted of interviews held in the rural center, the small town, and the medium city with planners, informal leaders and politicians. 4. A t the fourth and final step, interviews were held in villages and the rural center and small town to confirm some secondary data and to explore more information with villages officials. Similar stages were applied for interviewing and gathering secondary data in villages, rural centers, and small towns in Central Sulawesi. Definition of Major Terms Household For the purposes of the study, a household is defined as a group of persons who eat and cook together. The inclusion o f the eating and cooking components o f the definition was based on previous research and is considered to define an economic unit in Indonesian society. A household consists of all persons who are considered by the household head to be members of the household and/or those persons who in the previous five years had their normal place of residence in the household. This time period is considered suitable for theoretical purposes in 56 that economic links, both in terms of contributions to production and subtractions due to household consumption, would be expected to be most important during this period. Household socio-economic status The household socio-economic status is classified based on land ownership, including land they themselves own or rented land. There are four levels: 1. Households without any land. 2. Households with a small piece of land or less than 0.5 ha. 3. Households with a piece of land between 0.5 ha to 1 ha. 4. Households which have more than 1 ha of land. Income of household Household income is the total real income in currencies, or goods and services that could be transferred into currency by a member of the household (Rupiah/day; Rupiah/month; Rupiah/season; Rupiah/year). The household real income includes remittances sent by members of the household working or living outside the village. Migrant People who were born in a province other than North Sulawesi and later on moved to Dumoga Subdistrict, North Sulawesi. In this case study, all o f the migrants were born on Java and Ba l i and moved to Dumoga Subdistrict as transmigrants sponsored by the central government. 57 Nonmigrant People who were born in Dumoga Subdistrict or elsewhere in North Sulawesi, and who at the time of survey live in Dumoga Subdistrict. In this study, the nonmigrants are identified as local or indigenous people. Rural center The rural center is a capital city of the subdistrict (kecamatan), and the location of the subdistrict government and some district services or local agencies (dinas) involved in such areas as agriculture, education, and health. A rural center also has a bank and market which is open twice a week. Small town The small town is a capital city of the district (kabupaten), where most of the local agencies (dinas) are located. Most public services are available in this town, including education facilities up to and including secondary school, hospital and health center, banks, cinema, restaurants, cafes, and shops. The markets in small towns are open every day. Medium city The medium city is the capital city of the province, known as a Kotamadya. Kotamadya form the lowest level of fully autonomous urban government. Governments of kotamadya are able to regulate their own activities and maintain their own sources o f revenue. Thus, the kotamadya governments are able, like those at the district level, to maintain a broad range of internal planning and service functions within their government apparatus. Almost all public 58 services are available in the city, such as education facilities up to and including universities, hospitals and health centers, recreational facilities, and traditional and modern daily markets. Data Processing and Analysis A l l questionnaires were coded at the respective field sites by trained coders. Open-ended or unstructured questions were coded on the basis of what the respondent emphasized in his or her answer. After the coding, data were keypunched in Manado and transferred onto magnetic tape for analysis using the S P S S X package. The data analysis required two levels of analysis: descriptive statistic analysis and qualitative analysis. Descriptive statistic analysis is used for analyzing variables indicated through absolute numbers or percentages. This kind of frequency table is useful for classifying data into cross tabulation. Cross tabulation is a simple method applied to investigate and analyze the relationship between two or more variables. Thus, cross tabulation can be used for hypothesis testing. Qualitative analysis is especially useful for variables related to sociocultural phenomena which are impossible to quantify, such as decisions within the family to move, or the level of participation of community in rural development (e.g., mutual assistance, sociocultural association [mapalus]). A s mentioned earlier, some difficulties may be encountered in the process of sampling, and need to be taken into account in interpretation of findings. The main variables for hypothesis testing were analyzed by fitting those variables into cross tabulation. The 239 households in four villages in North Sulawesi constitute the main case study. The results of the interviews (both with questionnaire and without questionnaire) with 49 households in three villages in Central Sulawesi are used to support the findings gathered at the four villages in North Sulawesi. For purposes of analysis villages are classified into two groups, transmigration villages and non transmigration villages. 59 Description of Study Areas The Country Indonesia is a vast archipelago state that consists of over 13,000 islands, with some three thousand inhabited and more than ten thousand uninhabited islands. It is the largest country in Southeast As ia , with a land area of over two mil l ion square kilometers, situated along the equator over an expanse of more than five thousand kilometers. It has a varied physical environment. In the early part of the seventeenth century the Dutch obtained footholds on Java and Maluku, and operated until the close of the eighteenth century in the form of a private trading company. The Dutch colonial period lasted until 1949, except for two brief periods, in the early 1800s when the British were in control, and in the 1940s during the Japanese occupation (Ricklefs, 1981). The islands of Java and Ba l i , generally referred to as the central or inner islands, are wel l - endowed with physical factors which are favorable for agriculture. They have mostly well- drained and fertile volcanic soils, enjoy rather favorable precipitation levels and intensive cultivation can be carried out in many areas. Rice and other food crops dominate the agriculture production pattern. The outer islands generally have a less favorable combination of physical factors. Drainage problems occur on a large scale in some parts of South and East Sumatera, South and Central Kalimantan, Southeast and Central Sulawesi, and in the southern part o f Irian Jaya. Agriculture development in these swampy zones is very limited. Soil fertility in a number of areas in the outer islands has been seriously effected by leaching processes, with considerable areas of Kalimantan and Sumatera suffering from such problems of soil impoverishment. Most of the country's perennial tree crop estates and plantations which produce for the world market are located on the outer islands. 60 The differences between Java and the other islands, however, go beyond current patterns of inequity. In terms of historical, ecological, and population developments, Java and the outer islands are seen as two quite distinct situations (Geertz, 1963; Ricklefs, 1981). The political and economic concentration of power on Java, particularly in Jakarta, is to large extent based on the extraction of resources from the outer islands. The labor structure and population processes evident at the micro level in Java are affected by both the social and political structure of Java and the relationships between Java and the outer islands. One important aspect is also related to the culture. In Java and Ba l i , rice is the main staple of the diet. In the outer islands, other traditional staples (such as corn, cassava, sweet potato, and sago) are the basis of the traditional diet. The diversity of Indonesia's development has its consequences for transportation, communications, and location of modern industries. Inter island shipping remains the dominant form of transportation and many parts are relatively isolated. In these areas, air transport is of key importance. On Java and parts of Sumatera, the road and railway systems are rather well developed and communication is comparatively good. Modern industrial development is largely concentrated on Java and some parts of Sumatera. Most of the big chemical industries (largely state-run) and other basic industries are found at coastal locations on both islands. Most privately owned and labor intensive small and medium-sized manufacturing industrial activities, which produce mainly consumer goods for the domestic market are found at locations near their customers (i.e., Java). A s the fourth most populous country in the world, Indonesia reached a population of 200 mil l ion inhabitants in February 1997 1. The population growth rate is slightly lower than 2 percent 1 It was predicted by the Central Bureau of Statistics and State Ministry of Population and Family Planning that Indonesia would reach 200 million in population on February 4 t h 1997. Published by Kompas February 5 t h, 1997. 61 per annum. The relat ively l o w popula t ion growth rate is largely attributable to a massive fami ly p lanning program. The nat ion-wide efforts i n this f ie ld were launched i n 1970. The popula t ion growth rate impl ies a demographic structure that is characterized by a relat ively young populat ion. The dis t r ibut ion o f popula t ion is extremely unbalanced. The islands o f Java, Madura , and B a l i , w h i c h account for on ly 7 percent o f the total area, have close to two-thirds o f the national popula t ion. T h i s results i n the popula t ion density o f Java, at almost 2000 persons per square ki lometer , be ing one o f the highest i n the w o r l d . The 1990 census (the most recent census f rom w h i c h results are available) indicated that around 31 percent o f the popula t ion l i v e d i n urban areas. Out o f the f ive largest cities, four are situated on Java Island. Rural -urban migra t ion is a substantial contributor to the urban popula t ion growth. In the per iod 1980-1990, on average the populat ions i n urban and rural areas had g rown by 5.4 percent and 0.76 percent per year respectively. The l imi t s o f expansion o f cul t ivable land on Java have been reached, yet agricultural land remains avai lable i n the outer islands o f Indonesia. A major p o l i c y o f the Indonesian government and the co lon ia l D u t c h administrat ion pr ior to independence was the sponsorship o f popula t ion movement f rom Java to these islands. Such movement , both through the government- sponsored transmigrat ion scheme and through spontaneous movement , has occurred, but the costs i n v o l v e d i n these long distance moves and the unsui tabi l i ty o f m u c h o f the land for wet rice agriculture have l im i t ed the numbers o f migrants (Hardjono, 1977; W o r l d Bank , 1988). The economic structure and condit ions have changed considerably i n the past two decades. F r o m the 1970s to 1980s, the agricultural sector ( inc lud ing farm food crops and farm non food crops, estate crops, l ivestock, fishery, and forestry) p r imed the engine o f economic development as the m a i n contributor to the total gross domestic product. In the 1990s agriculture was replaced by manufacturing as the leading sector. It is estimated that the trade sector w i l l 62 become the next main engine of economic growth in Indonesia. The slow down in world trade in the mid 1980s, the relatively poor export price performance of a number of non-oil commodities, and the fall of o i l prices in 1986, all led to a deterioration of external economic conditions in the mid 1980s. The growth rate of gross domestic product slowed down from an average annual rate of about 8 percent during the 1970s to 7 percent during the period of 1985 to 1995. 6 3 C3 C3 O C © OH S-i W) O o 2: t 0 5 .1 x S i <>- <*2C_I2£>-IDU» « _ < < »^ B M - So 64 North Sulawesi Province North Sulawesi occupies the eastern section of the long northern peninsula of Sulawesi (refer to Figure 2.2). The main section of land is about 600 kilometers long and not more than about 80 kilometers wide. It consists of four districts (Sangihe Talaud, Minahasa, Bolaang Mongondow, and Gorontalo), and three municipalities (Manado, Bitung, and Gorontalo). Each district has its own unique background and culture. Minahasan and Sangerese people are mostly Christians, Bolaang Mongondowese and Gorontalese are mostly Moslems. Table 2.3 North Sulawesi: Population B y Sex, 1920-1990 Year Male Female Total 1920 295,039 292,400 587,439 1930 374,000 374,000 748,000 1961 664,726 667,772 1,332,534 1971 861,293 856,378 1,717,671 1980 1,069,763 1,045,621 2,115,384 1990 1,255,330 1,221,859 2,477,189 Source: Bappeda, 1994. The population of North Sulawesi has grown from more than half a mil l ion in 1920 to over 2 mil l ion in 1980 and 2.477 mil l ion in 1990. The growth rate of population during the period 1971-1980 and 1980-1990 was 2.21 percent and 1.60 percent per annum respectively. North Sulawesi's population has grown more slowly than that of the country as a whole. The changes in the rate o f population growth are not only influenced by natural increase but they are also affected by migration. In the period 1980-1990, the average population growth in urban and rural areas was 4.76 percent and 0.84 percent respectively. Even though the coastal regions of the peninsula's northern part have long been densely populated, the interior of this region is still a pioneer frontier. In the last two decades population growth in some interior rural areas, however,  66 has increased because of the transmigrants from Java and Ba l i as well as spontaneous local migrants. The economy in North Sulawesi depends mainly on the agricultural sector. The proportional contribution of the agricultural sector to the total gross regional product (GRP) was about 26.92 percent in 1994. Among those five sub-sectors (farm food crops and farm non-food crops, estate crops, livestock, fishery, and forestry) classified under the agricultural sector, the sub-sectors of farm food crops/farm non-food crops and estate crops shared a relatively big contribution to the total regional gross domestic product, with the proportions of 10.6 percent and 9.1 percent respectively in 1994. Looking at the absolute numbers, however, the data indicated that growth rates of the fishery and forestry sub-sectors in 1993-1994 were about 16.3 percent and 13.3 percent respectively. These figures were relatively high compared to the agricultural sector's overall growth rate (only 7 percent). The second largest contribution to the total gross regional product (GRP) was provided by the services sector with around 38.02 percent in 1994. Between the two sub-sectors, government services and private services, which are classified, under the services sector, the shares of government services and private services in the total regional gross domestic product were about 14.9 percent and 3.2 percent respectively in 1994. A t the same time, the contribution of the manufacturing industrial sector to the total G R P was 35.07 percent. Most of the manufacturing activities in North Sulawesi are classified into small-scale industries, producing mainly food and beverages, cigarettes, textiles, furniture and handicrafts, and agro-processed products. Some basic industries, such as coconut oi l plants and most of the fish canneries are located in the municipality of Bitung, where the main port is located. Other big industries and many small-scale industries are scattered along the corridor between Manado, capital city of the province, and Bitung. It is understandable that most of the industries in North Sulawesi are 67 concentrated in these areas because they can be supported by the relatively complete infrastructure required by industries, such as a main harbor, airport, highway, transportation networks, and communication. Since 1995 this area, the corridor of Manado-Bitung, has been designated by the central government for promotion as one of the growth centers in Indonesia's northeastern region. Table 2.4 North Sulawesi: The Structure of Employment by Industry, 1990 and 1994 (percentage) Industry 1990 1994 M F M+F M F M+F Agriculture 63.67 38.95 56.49 64.20 41.77 57.74 Manufacturing 12.59 14.53 13.17 10.90 10.98 10.95 Service 23.74 46.44 30.34 24.90 47.25 31.31 Total 100.00 100.00 100.00 100.00 100.00 100.00 Note: M = Male, F = Female Source: Bappeda, 1994; Statistics Office, 1995 A comparison of employment in the various sectors is shown in Table 2.4. The data clearly indicate that more than 50 percent of employment was found in the agricultural sector. The proportion of employment absorbed in manufacturing activities was relatively small and decreased slightly from 13.17 percent in 1990 to 10.95 percent in 1994. A t the same time the proportion of employment in the agriculture and service sectors slightly increased. Males took most of the agricultural employment (64.20^percent), and females dominated employment in the service sector (47.25 percent). The higher proportion of females in the service sector may be due to the fact that many of them are employed in the trade, hotel and restaurant, banking, and government sectors. 68 Bolaang Mongondow District The Bolaang Mongondow District (kabupaten) is one of four districts in the province of North Sulawesi. The district, an area of 8358 square kilometers (30.4 percent of the total area of North Sulawesi), is located between Minahasa District and Gorontalo District (Figure 2.3). The district has good access to major road and transportation networks. The Trans-Sulawesi highway crosses the northern coast of the district and another highway crosses the district's southern coast. Between these two highways, another highway crosses through the hills and valleys of the middle of the district to the national park on the district's western side, bordering Gorontalo District. With an average population density of 47.04 persons per square kilometer in 1994, Bolaang Mongondow District is the least densely populated district in the province of North Sulawesi. In 1994 the population numbered around 393,211 persons, consisting of 200,870 males and 192,341 females. In other words, the district had a sex ratio of 104.43, the highest among the districts and municipalities in North Sulawesi. There were about 85,428 households, with an average of 4.60 persons per household. The district is administratively divided into 15 subdistricts (kecamatan) and 243 villages (desa). Table 2.5 Bolaang Mongondow District: Population and Density Year Population Persons/km2 1961 150,127 17.96 1970 208,609 24.95 1980 299,696 35.85 1990 372,725 44.59 1994 393,211 47.04 Source: Bappeda, 1992; Bappeda, 1994. The structure of employment classified by sector is shown in Table 2.6. The data indicate that the majority of employed males and females in Bolaang Mongondow were working in 69 agriculture. The service sector absorbed the second largest proportion of employment. The proportion of females involved in the service sector was more than two times that of their counterpart males. The proportion of people engaged in manufacturing activities was relatively small. A s at the provincial level, males dominated in agricultural activities and females were concentrated in the service sector. Table 2.6 Bolaang Mongondow: The Structure of Employment by Industry, 1994 (percentage) Industry M F M+F Agriculture 73.75 42.70 67.29 Manufacturing 8.42 8.08 8.34 Services 17.83 49.22 24.37 Total 100.00 100.00 100.00 Note: M = Male, F= Female Source: Statistics Office, 1995 In the distribution of Bolaang Mongondow's gross regional product (GRP) among the agricultural (A), manufacturing (M), and services (S) sectors between 1990 and 1993, the largest share was contributed by agriculture. Agriculture's contribution slightly increased from 49 percent in 1990 to 50.95 percent in 1993. The district has almost 170,000 hectares of agricultural land, with around 42,791 ha farmed in wet rice with irrigation networks and about 7,000 ha without irrigation systems (rain-fed fields or sawah tadah hujari). With almost 50,000 ha of rice fields in 1992, the district has the largest area of rice fields of any district in North Sulawesi. Most of the wet rice fields are situated in Dumoga Subdistrict, where the four case study villages are located. Dumoga Subdistrict is called the "rice barn" of North Sulawesi.  71 Table 2.7 Bolaang Mongondow: Sectoral Distribution of Gross Regional Product, 1990-1993 Year Sectoral Distribution (%) A M S Total 1990 49.39 12.20 38.41 100 1991 50.92 12.22 36.86 100 1992 51.47 12.32 36.21 100 1993 50.95 12.61 36.44 100 Note: A = Agriculture, M = Mining and quarrying, manufacturing, utilities, and construction. S = Services. Source: Bappeda, 1994 The biggest part of agricultural land in Bolaang Mongondow consists of plantations of coconut, clove, nutmeg, cocoa, and vanilla. Some of these commodities are exported both to other provinces in Indonesia and to other countries. These plantation areas are distributed in small plot areas o f small-holder production, and organized by local people. However, because the price of these crops is relatively unstable, being subject to fluctuations on the world markets, and the terms o f trade are relatively poor, farmers have not given serious attention to or organized the plantations efficiently. Table 2.8 Bolaang Mongondow: Planted Area by Rice and Crops, 1994 Plantation Area (ha) (%) Rice: 49,791 29.44 Wet rice fields 42,791 25.30 Rain-fed fields 7,000 4.14 Coconut 46,715 27.62 Clove 7,526 4.45 Coffee 3,422 2.02 Nutmeg 96 0.06 Cocoa 989 0.58 Vani l la 232 0.13 Pepper 74 0.05 Others (corn, cassava, sweet potato, nuts, vegetables, fruits, etc.) 60,245 35.62 Total 169,090 100.00 Source: Bappeda, 1994 72 Table 2.8 indicates that around 35.62 percent of agricultural land in Bolaang Mongondow District is planted in corn, cassava, sweet potato, nuts, vegetables and fruits, all crops which were traditionally staples of the Mongondownese diet. However, when the wet rice fields were developed and supported by dams and irrigation networks built in the early 1980s, rice became the main production crop in the region. A t the same time, the main staples of the diet of most population in Bolaang Mongondow gradually changed from corn, cassava, and sweet potato to rice. Some people in the region still rely on both corn and rice as their main staples. The manufacturing sector's contribution to the total gross regional product from 1990 to 1993 was less than 13 percent. A l l manufacturing activities included in this sector were small- scale industries: food industries, ceramics industries, brick industries, furniture industries, utilities for agricultural production, and handicrafts. Most of these "industries" were family-run or home industries. There are many small industries and craft production related to agriculture and simple agro-processing, dispersed throughout the countryside. Palm sugar processing is the most common, especially in Passi Subdistrict. Another kind of agro-industry, rattan manufacturing, is concentrated in Kotamobagu Subdistrict, and bamboo-craft in Lolayan Subdistrict. This primary and secondary production is partly reflected in the trade flows at traditional markets in the subdistrict centers or rural centers. In most rural centers there is a market which in some places is open five days and others only two or three days per week. In addition, there are markets in some of the larger villages. Commodity flows and trader movements at the market link subdistricts to one another and moreover link the countryside to the outside world. The share of the service sector in total gross regional product has decreased, mainly in the government subsector, from 38.4 percent to 36.4 percent. The drop is probably because local government has limited recruiting new public servants and has reduced expenditures for public 73 services. Some subsectors such as trade, transportation, and government contribute a relatively large share to this sector. The banking subsector and other services contribute relatively little to the services sector total. The Villages The four villages selected for study are located in Dumoga Subdistrict of Bolaang Mongondow District. Figure 2.4 displays the location of the four villages. Two villages, Doloduo and Dondomon (both non-transmigration villages) are located 16 kilometers and 14 kilometers respectively on the west of the subdistrict capital or rural center. The other two villages, Mopugad Selatan and Mopuya Selatan (both transmigration villages), lie to the northwest, 25 kilometers and 20 kilometers respectively, from the subdistrict capital. O f the four villages, Doloduo and Mopuya Selatan have the easiest access to Kotamobagu, the district capital. Both villages have direct public transit services to Imandi (a subdistrict capital), Kotamobagu (a district capital), and Manado (the provincial capital). B y minibus (Kijang) from these two village to Imandi, Kotamobagu, and Manado, it costs Rp 500, Rp 1500, and Rp 6500 2 respectively. The five-kilometer trip between Mopugad Selatan and Mopuya Selatan can be undertaken by oplet, a small minibus, at a cost of Rp300. From Dondomon to Imandi or Doloduo by public minibus is costs Rp500. The various demographic characteristics of the four villages are shown in Table 2.9. O f the four villages, Doloduo has the largest population and the largest village area. Settled by local people in the late 1800s, Doloduo is also the oldest village of the four villages, and one of the oldest villages in Dumoga Subdistrict. Before it was settled, Doloduo was a place for hunting and 2 At the time of the study in 1995 the rate of exchange between the United States dollar and Indonesia rupiah was approximately $1 = Rp2270. To place this amount within a local context, the wage for an agricultural laborer was Rp5000 per day.  75 farming by traditional methods, such as slash and burn, by local people. It was chosen for farming because of the fertile land and its close access to one of the biggest rivers in the area, the Ongkag Dumoga River. The river provided water for irrigating farm land by a traditional network system. In the early 1900s, local people started to settle permanently in the area, with a nucleus of around 20 households in the small hamlet. In 1910, some families migrated to Doloduo from Dumoga Village which is approximately 25 kilometers from Doloduo. With the new migrants, the number of families in the village then counted around 80 families. According to one of the elders l iving in Doloduo, at that time Doloduo was directly under the traditional kingdom of Bolaang Mongondow. In the 1930s the Dutch came and took over the village, and people of ages twenty years and over and those married less than twenty years had to pay taxes to the Dutch colonial government. Since the 1950s, Doloduo's population has grown relatively quickly because more people migrated to the area from other subdistricts and also from Minahasa. The most common motivation for this was that people could buy the land very cheaply (1 ha of land sold for only Rp50). In the early 1950s some local people moved to Dondomon, which is located only 5 km to the east of Doloduo. Because of the flow of migrants from other villages surrounding Dumoga Subdistrict, the village population grew quite high. The biggest movement of migrants to the village came in the mid 1970s, and was comprised of both Mongondownese (70 families) and Minahasans (180 families). Even though these two villages had been growing since the early 1950s, road access to the areas remained very poor. In 1972 the main road was built of asphalt. Before the road was developed, traveling from Doloduo to Kotamobagu (around 60 km) took more than one day by 76 foot or two days by gerobak, a cow-drawn cart. Thus people had to spend days to transport their crops to the market in Kotamobagu and to buy their daily needs to take home. Mopuya Selatan and Mopugad Selatan are two transmigration villages which were established in 1972 and 1975 respectively. The majority of migrants who settled in Mopuya Selatan originally came from East Java Province and those in Mopugad Selatan came from Bal i Province. Originally, Mopuya Selatan and Mopuya Utara were part of a single village called Mopuya Village. Because of the village's rapid growth (a consequence of both natural increase and in-migration, with limited availability of land surrounding the village), village officials, elders, and informal leaders decided at a village meeting in 1985 that the village of Mopuya would be divided into two independent villages called Mopuya Utara and Mopuya Selatan. This agreement was also approved by the Dumoga Subdistrict and local government officials. The same conditions and outcome were experienced by Mopugad Vil lage, which divided into two independent villages, Mopugad Selatan and Mopugad Utara, in 1987. Table 2.9 Demographic Characteristics of Sampled Villages Characteristics V i i lage Doloduo Dondomon Mopugad Selatan Mopuya Selatan Population 1993 4,571 1,892 1,695 2,262 Number of Households 967 351 336 415 The Average of Population per Household 4.7 5.3 5.0 5.4 Area of Village (Ha) 1,540 719 344 594 Source: Vil lage Offices 77 A l l four study villages receive irrigation. Doloduo gets water from the Kasinggolan Dam which was completed in 1981, and Dondomon, Mopugad Selatan, and Mopuya Selatan from Torout Dam which was completed in 1986. Before the introduction of irrigation, it was only possible to cultivate one crop of rice per year, but now it is possible to grow two or three crops of rice a year. Agriculture in all of the villages is highly integrated into input and output markets. The use of pesticides, fertilizers, and modern strains of rice is almost universal. These inputs are mostly bought by farmers from the owners of the rice mi l l , rather than obtained through the government Inmas program to which, according to local statistics, all farmers in the four villages belong. The Bimas (mass guidance) program, the organization which preceded Inmas, was largely accepted in the area during the late 1970s. The reason most farmers buy their inputs from the owners of the rice mi l l is that they can get credit and pay later in the harvest season at prices a little bit higher than the common price. Because of the geographical location of the villages and the year-round access to irrigation, the majority of land not used for buildings is capable of being used for growing wet rice. Table 2.10 shows a number of aspects of agricultural development. The first two measures were obtained from local statistics while the remaining measures were estimates obtained in interviews with village officials. These data indicate that the villages of Mopugad Selatan and Mopuya Selatan are the most developed agriculturally. They possess more modern agricultural equipment, prepare more of their land with tractors, and also use outside laborers. However, the variation between villages is not great. This is in large part due to the large-scale changes in agriculture, such as the introduction of mechanization and the spread of Bimas and the subsequent Inmas programs, which took place in the early 1980s. 78 Table 2.10 Indicators of Agricultural Development by Village, 1995 Indicator of Agricultural Development V i i lage Doloduo Dondomon Mopugad Selatan Mopuya Selatan 1. a. Number of Tractors - - 4 7 b. Number of Rice M i l l s 4 2 4 5 c. Number of Corn M i l l s 7 3 - - 2. Percentage of Farmers involved in Inmas (1) 100 100 100 100 3. Preparation of Land (%) a. Tractor - - 20 30 b. C o w 40 30 40 30 c. Human Labor 60 70 40 40 4. Percentage of Agricultural Labor from outside of Vil lage (2) 20 15 10 15 5. Number of Farmer Groups 4 4 6 5 Note: (1) Inmas is an agricultural program of mass intensification. (2) Refers only to the planting seasons. Source: Village offices and field surveys The most common method of harvesting is termed bawon. Two forms of this method occur. In the first form, harvest is open to all members o f the village, with each harvester receiving approximately one-tenth of the amount they harvest. The second form of bawon involves only invited family members who receive a larger share of the harvest than non related villagers. Another form of harvesting that was reported in all four villages was harvesting for wages. According to statistics obtained from the village offices (see Table 2.11), all villages have a high percentage of inhabitants engaged in agriculture. The data indicate that Doloduo and Dondomon have relatively high proportions of employers and government workers. In Dondomon, there is an especially high proportion who are working as carpenters, with most of their customers coming from outside the village and many of their products found in small towns. Mopugad Selatan and Mopuya Selatan have a relatively high proportion both o f farmers 79 who own land and farm laborers. In Mopuya Selatan a relatively large number of persons specialize in building trades. There are also traders of items such as house utensils, food and vegetables who travel by bike or motorbike to the other villages surrounding Dumoga Subdistrict. Mopuya Selatan also has many people engaged in transportation, such as minibus drivers, conductors on public transit, and motor cab drivers. Table 2.11 Primary Occupation of Persons Aged 15 and Over by Village, 1995 Village (percentage) Occupation Doloduo Dondomon Mopugad Mopuya Selatan Selatan Farmer (Own Land) 43 42 59 40 Farm Laborer 10 15 20 31 Employer 28 20 2 4 Trader 4 3 4 8 Carpenter 3 10 6 3 Transport Worker 2 - - 4 Government Worker 8 9 5 6 Construction Laborer 1 1 2 2 Others 1 - 2 2 Total 100 100 100 100 Number 871 351 368 627 Source: Village Offices The main public facilities available in the four villages are indicated in Table 2.12. In general the data indicate that only Mopuya Selatan has relatively complete public facilities. B y contrast, Dondomon's public facilities are quite limited. A l l villages have a primary school. Only two villages have a junior high school, thus the children from Dondomon and Mopuya Selatan have to walk or travel to other villages which have junior high schools. The public senior high school is only available in Imandi which is a rural center. The public markets located in the three villages are not open simultaneously. There is a schedule which rotates the opening of each market on a different day for a whole week. 80 Table 2.12 Major Public Facilities of Sampled Villages Village Facilities Doloduo Dondomon Mopugad Mopuya Selatan Selatan Market 1 - 1 1 Bank - - - 2 Cooperative - - 1 1 School: Primary School 6 3 1 2 Junior High School 1 - 1 - Senior High School - - - - Health Services: Community Health 1 Center - - - Small Health Cl inic Center 1 - 1 - Post Office - - - 1 Source: Vil lage Offices The Rural Center The rural center is the Dumoga Subdistrict capital, which is called Imandi. It is situated in the middle of the Dumoga Valley, and the distance between Imandi and Kotamobagu, the Bolaang Mongondow District capital, is around 40 kilometers. The rural center consists of three villages (Imandi, Modomang, and Dumoga) and has a total population of 8,393 inhabitants in 1994. The average population density is about 1.6 persons per ha. The population growth rate in the period 1984-1994 was around 2.9 percent per year (Statistics Office of Bolaang Mongondow, 1995). The relatively high population growth rate was caused by both in-migration and natural increase. A s a rural center located in the middle of wet rice fields, the main activity of population is in the agricultural sector which accounts for 80.8 percent of the total employment. Most people working in agriculture produce rice and food crops such as fruits, vegetables, and beans. Some o f them also have ponds for fish and livestock. Breeding chickens and ducks are other small scale 81 activities. The population involved in industrial activities amounts to only 1.2 percent. A l l industries located in this area are classified as small industry, producing mostly food, handicrafts, and furniture. The population engaged in trade accounts for 5.4 percent of the total employment. Most of these activities such as those of shop keepers, retailers, traders, and middlemen, are concentrated in the center of Imandi where the public market is located. Around 8 percent of the population work as public servants, police, and army. A small proportion of people, slightly more than 1 percent, were involved in transportation and others activities. Because nonagricultural village jobs are limited, during the slack season, many farmers look for work outside the village. Most of them move to small towns and/or medium city to find work as construction workers, laborers in public markets, and laborers in small-scale industries such as concrete, brick, or rattan industries. Some farmers go to work as gold prospectors in the western reaches of the region, next to the National Park of Dumoga Bone. Such prospecting has been banned by local government because most of the activity is carried on inside the national park. The rural center has a good road network connecting it to villages around Dumoga Subdistrict and to other rural centers, districts, and the medium city. The main public transportation to villages surrounding the rural center is provided by oplet, a small minibus, bendi, a horse-drawn cart, and ojek or motor-cab. The route from Imandi to Kotamobagu is served by kijang, a minibus, and costs about Rp l500 (in 1995 the rate of exchange between the United States dollar to Indonesia rupiah was approximately $1 = Rp2270). The route from Imandi to Manado (the provincial capital) route is served by buses run by department of transportation and private companies. Tickets costs about Rp6000 for a four hour trip. Because it is a center of the subdistrict region, all subdistrict government offices and services such as police, post office, schools (from primary school to senior high school), 82 community health center, and some local government institutions such as agriculture, education, and health, are located in Imandi. There are two public markets, one located in Imandi and the other in Dumoga Village. The markets are open two times a week each on a different day. To support local economic activities, there are two banks (one private and the other government-run) open six days per week. There are shops specializing in groceries, building materials, agricultural inputs and equipment, textiles, furniture and household supplies. There are many warung, or small shops, located in the environs of the public markets and also restaurants, cafes, barbers and hair-salons. The main urban facilities available in the rural center are very limited. There is no sewage or drainage system. Because there is no water supply available, almost all households have their own well for drinking water. Most houses have electricity. For those who have television, regional and national television programs have become the main-stay of family entertainment. Some wealthier families enjoy other television programs by means of satellite dishes. The Small Town The small town is Bolaang Mongondow District's capital and called Kotamobagu. It consists of 17 kelurahan or villages and all together constitutes a subdistrict headed by a Camat (head of subdistrict). In 1988 the population in Kotamobagu totalled 40,070 inhabitants and had increased to 50,683 population by 1992. During the period of 1988-1992 the average annual population growth rate was 3.32 percent. It was predicted by local government that in 1997 the population would total around 63,143 and by 2002 it would reach 76,889 inhabitants (Statistics Office of Bolaang Mongondow, 1995). The distribution of population in Kotamobagu is relatively unbalanced. According to 1991 subdistrict government data, most of the population was concentrated in the city center, 83 such as in the Kotamobagu and Gogagoman kelurahan, where the population densities were around 82 and 79 inhabitants per ha respectively. Population density outside the city center ranged from 46 persons per ha to only 7 persons per ha. Formal documents published by the subdistrict government do not contain information about employment based on main industry. Based on my interviews with government officials who are working in subdistrict and district offices, as well as interviews with informal leaders, entrepreneurs, and politicians, and confirmed by my direct observations in town (during two weeks in October 1995 and a week in December 1996), it can be assumed that the majority of population work in the agricultural sector. Because all local government offices and services are located in town, there is some employment in the government sector. The trade and industrial sectors absorb a relatively small proportion of employment. According to my observations, the town starts its activities early in the morning, especially in the two public markets (pasar), called pasar Inpres and pasar Sebelas Maret, located in the center of town. Around 5 a.m. the small trucks with many kinds of vegetables came from outside town and start to unload the vegetables to the main wholesalers in these two public markets. From these main distributors, the vegetables are distributed to traders who conduct their businesses in these two markets, and to the bike or motorbike vendors who market their vegetables by traveling from one village to another. After six a.m. the town becomes busy with children who are going to schools which start at seven a.m. and last until one p.m. A t the same time public servants and employees are going to their offices, and the markets are becoming more crowded with customers. The warung, small shops which sell food, coffee, and tea, and are located surrounding the markets, are filled with customers having breakfast before they go to work. The big shops start to open around 8 a.m. and some of these shops are open until 9 p.m. Activities in the center of town start to slow down after 84 3 p.m. In the evening only a few shops, restaurants, and cafes are open, and after 9 p.m. the city center grows quite after a busy day. Some private and government banks with nice looking buildings are located in the very busy areas to support the main economic activities in town. There are many kinds of small shops in the center o f town specializing in selling textiles, house supplies, accessories, jewelry, furniture, and groceries. Nearby are shops which specialize in distributing motorbikes, bikes, spare parts for cars and motors, electronics, building materials, and agricultural supplies. In the last few years two department stores and car centers have opened. According to one entrepreneur, in the last decade many more new hair salons, video rental shops, cassette and compact disk shops, electronics and satellite disk businesses, and car accessories shops have opened in town. This boom indicates that modernization and globalization are reaching even small towns located in isolated areas such as North Sulawesi. The main transportation in town is the oplet, a small minibus, and the bendi, a horse drawn cart, which are used mostly for short distances around the center of town. To connect the town with other rural centers and towns, there are many minibuses. From Kotamobagu to Manado, the provincial capital, there are buses called Damri, run by the Department of Transportation and by private companies with fares of around Rp4000. Some private transport companies offer special services to pick up passengers at their homes outside the city region and then deliver them to specific places in Manado, a special service which costs around Rp7000. Most public facilities such as hospital, schools, post office, and police station are available in town. The town is also complete with water supply, electricity, and communication. Most government offices are relatively new buildings. Although the buildings are big, the services they offer to communities are very slow. 85 The Medium City The medium city is the capital city of North Sulawesi Province, called Manado. The city has been settled by local people since the sixteenth century, and was previously called "Wenang". In 1623, the name of Wenang was changed to Manado (a word taken from the Minahasan language, "Mana dou", meaning "too far"). In 1919, based on the approval of the colonial Dutch government, it became a provincial capital. The municipality of Manado consists of 5 subdistricts and 68 kelurahan, neighborhoods which are administratively similar to villages and constitute the lowest level of government in the city. In 1994 the city's total population was 347,235 persons, and during the period of 1990 to 1994 the population growth rate per annum was 2.49 percent. According to an analysis of the Central Bureau of Statistics and Population and Family Planning Bureau, during that period the natural growth rate of population was only 1.27 percent per year. Therefore, the remaining 1.22 percent was provided by the flow of in-migration from other districts in North Sulawesi and from other provinces outside North Sulawesi. The total area of the city is around 15,726 ha and the population density is around 22.39 persons per ha. Based on the 1990 census data and the 1994 national economic census, the employment structure in Manado is shown in Table 2.13. The data indicate that the service sector absorbs the biggest part of employment in Manado and the proportion of employment in that sector increased from 72.2 percent in 1990 to 77.3 percent in 1994. In the same period the proportion of employment involved in the manufacturing sector slightly decreased, and in the agricultural sector sharply decreased. The increased proportion of employment in services sector is strongly related to an increase in the activities of the tourism industry. During the last few years, several big hotels were built in Manado, and an increasing number of tourists (both international and local) are traveling to North Sulawesi to enjoy the diving, scenery, and culture of North Sulawesi. 86 Table 2.13 Manado: Sectoral Distribution of Employment, 1990 and 1994 Year Sectoral Distribution (%) A M S Total 1990 10.19 17.65 72.16 100 1994 6.14 16.54 77.33 100 Note: A = Agriculture, M = Min ing and quarrying, manufacturing, utilities, and construction. S = Services. Source: Bappeda, 1995; Statistics Office, 1994. The economic growth rate of Manado during the period of 1989-1995 averaged 10 percent per year. The industrial sector and services sector (especially banking subsector) indicated rapid relative increases. However, at the same time some sectors (trade and transportation sectors) showed decreases. The overall composition of the regional economy indicated that the main engine of Manado's economy strongly depended on certain sectors, such as trade (23 percent), transportation (18 percent), government (17 percent), and banking (which increased its proportion to 10 percent of the total gross regional product). The main public transport in the city is the oplet, a small minibus. A l l oplet are run by private companies. The cost for one trip, for either a short or long distance, is only Rp300. Certain routes are served by buses called Damri, which are run by the Department of Transportation, and charge a fare similar to the oplet (Rp300). Around certain public markets such as Bersehati Market and Pinasungkulan Market, the two biggest markets of the six located in Manado, there are many bendi which haul short distances with the cost around Rp300 per person. In the evening, there are many motor-cycle taxis or ojek especially in the center of town, which offer services for short and long distance hauls, with the price depending on the distance. These motor-cycle taxis mostly begin to operate after the oplet and bus are no longer running. This kind of transportation is classified under the informal sector because it is not considered by city government as public transport. 87 CHAPTER THREE POLICIES FOR RURAL AND URBAN DEVELOPMENT Introduction Since the implementation of Indonesia's first five-year development plan in 1969, rural development has been a priority, especially for the agricultural sector. Efforts to increase rural l iving conditions have been undertaken through such giant programs such as intensification of rice production and transmigration. Large amounts of the money required for this have been borrowed from the World Bank and other lenders. Both programs have been put into action by provincial and local governments, following strict guidelines produced by the central government through the Ministry of Agriculture and the Ministry of Transmigration. Generous portions of the project budgets have been invested in basic infrastructure such as dams, irrigation systems, and road networks. The programs have had a significant impact in creating new job opportunities for both on-farm and off-farm employment, and increasing incomes of rural communities. On the other hand, these programs have widened the gap between the rich and the poor, creating conflict between migrants and local people. Certain species of tree and animal life have been destroyed. A s indicated by this field study, the most important problem is the lack of program planning and coordination among departments and across economic sectors. In Indonesia, rural development policy emphasizes the goal of rice self-sufficiency. There are two approaches to increasing rice production. The first approach, intensification of rice production, is implemented by increasing the use of agricultural inputs such as new seeds, fertilizers, pesticides, and mechanizing production tools such as hand tractors. The second approach is extensification of wet rice production, which is accomplished by enlarging the area 88 under wet rice cultivation. The means of implementing this approach has been through the transmigration program. Clearing of land is accomplished by destroying the forest and then converting the fertile land into wet fields for rice. In the case study areas of North Sulawesi, transmigrants are resettled in fertile land which can easily be turned into wet rice fields. Therefore, the transmigration program strongly supports the rural development policy of rice self-sufficiency. Urban development tends to focus mainly on physical and services development rather than on urban management that could improve local government institutions and upgrade human resource capacities as the main resources for implementing local autonomy. Rural and urban development policies have been implemented separately as two different areas of concern rather than put into a unified rural-urban development framework. This chapter presents a review of those components of rural development policies such as rice production intensification programs (or Green Revolution), transmigration programs, and urban development policy. A l l of these have had an impact upon the study area. The first section explores the meaning of village and the structure of village government. The second section analyzes how the national project of rice production intensification programs and related policies (such as market intervention policies) have been implemented in rural areas in Indonesia. The third section investigates the outcomes of transmigration programs vis-a-vis regional development and planning. The fourth section addresses the issue of why medium sized cities and small towns need to develop. The final section investigates the policies which have been implemented with regard to rural-urban development. 89 W h a t Is a Vi l lage? Village Classification Villages in Indonesia are characterized by a variety of socioeconomic conditions and levels of development. A village's level of development can be measured by criteria such as income, community participation in local development, and levels of health care and education. Based on the primary livelihoods of village people, villages can also be classified by primary economic function (Maskun, 1993): fishing village (perikanari), wet rice village (persawahari), dry land village (peladangan), husbandry village (peternakan), plantation village (perkebunari), and small industry village (perindustriari). Based on location, villages may be classified as a peripheral village, enclave or isolated village, island village, and village with close or easy access to a city. A l l of these have an effect on village characteristics and development. In formulating the development strategies and policies related to the needs of rural areas, villages or rural areas are divided into three groups. First, there are villages which have rapid growth, usually those villages located relatively close to and/or with easy access to urban areas. Generally, the main economic activities of such communities are diversified and do not depend solely on the agricultural sector. The community also shows indications of cultural change, a transition from traditional values or adat, and a start towards a market economy. Most of the rapid growth villages are classified by the Indonesian government as swasembada villages. Second, there are villages which have high potential to develop. In general, the main activity of these communities is work in the primary sectors especially agricultural and mining sectors. In these villages, diversification of activities are relatively limited and the community is quite homogeneous in culture and custom (adat). In general, economic activities are still on a subsistence level but some people are already oriented to the market economy. The villages are located relatively far away from cities and with difficult access to towns. These villages is mostly 90 classified as swakarya villages, which is considered a lower level of development than swasembada. Third, there are villages seen as having problems and limitations such as scarcity of natural and/or human resources and poor access to other centers and settlements. Such conditions are the main causes of villagers' poverty which makes them leave and go to other villages, with hopes of benefiting from the results of development nationally and locally. These are poor villages which require a special approach in order to increase the development in their region. These villages are classified as swadaya villages. Village Government Structure Indonesia's Basic Law No. 5 of 1979 defines a village as a region settled by a number of people in a community, legally organized directly under a subdistrict head (Camat) and with authority implementing its own household. A village differs from a city because it has a relatively low population density and its main activities are concentrated on the agricultural sector. In general, village communities are homogenous in terms of culture, ethnicity, religion, and main occupation. Furthermore, a group of villages which have functional linkages both socially and economically wi l l create a region or rural area. These rural areas mostly consist of relatively similar types of villages, although they may be administered through a rural center. The structure of the village government in the province of North Sulawesi and consequently in the four villages of the research is shown in Figure 3.1. The village head and secretary are ex-officio chairman and secretary of the village council (Village Consultative Council or Lembaga Musyawarah Desa [LMD]) . Members of the village council are formal and informal leaders in the village, including the village head, leaders of village organizations, and elders. The village has the right to arrange its own affairs, although the yearly budget has to be 91 approved by the subdistrict officials. Village governance is implemented by the village executive together with the village council, being a legislative body on the village level. The village head is assisted by five village officials and heads of the neighborhood organizations or hamlets. These neighborhood organizations are organized on a territorial basis and consist of a number of families ranging between fifteen and fifty households. The village head is not a government official and does not receive a monthly salary. A n y remuneration for village heads and officials has to come from the village's own resources. The village head is assisted by a second village council not belonging to the village government. The function of this second village council, the Village Council for Development Planning and Guidance or Lembaga Ketahanan Masyarakat Desa ( L K M D ) 1 , is to participate in planning, programming, coordinating, and executing programs for village development. In the villages of the field study, membership of these two village councils generally overlapped to a high degree. Meetings between the village government and representatives of the population were attended by members of both councils. The village head has two basic roles: as the head of the village community, and as the one responsible for carrying out instructions from higher levels of the government. The second role has gained in importance since the beginning of the first five- year development plan in 1969. Rural development programs of a number of ministries are carried out with the assistance of the village head and village government. One such example is agricultural development programs. The field extension worker operates at the village level and therefore has to cooperate with the village government. ' The L K M D was established by the Ministry of Home Affairs in 1980. At the village level, the L K M D , through its various sections, is responsible for coordination of all activities (as indicated in Figure 3.1.) in the field. 92 Figure 3.1 Structure of Village Government Head of Village Village Officials 1. Social 2. General 3. Sectoral Development 4. Security 5. Religion Heads of Neighborhood or Hamlet Village Consultative Council (LMD) Village Council for Development Planning and Guidance (LKMD) 1. Security 2. Education and Culture 3. Information 4. Infrastructure and Environment 5. Economy 6. Religion 7. Family Welfare 8. Health and Family Planning 9. Youth, Sports and Arts 10. Social Welfare Working Groups In reality, this structure means that there are no village activities which are not controlled and influenced by the L K M D , village head, or neighborhood heads respectively. Through the hierarchical structure of the organization, the government institutions above village level up to the Ministry of Home Affairs are always kept informed about village activities. The village head has to report to the head of subdistrict, who himself has to inform the head of the district and the local regional planning board, who inform the government's sectoral institution and the Ministry of Home Affairs. Apart from the L K M D , the head of the village is assisted by five village officials {pamong desa) who are responsible for field activities corresponding to those of the 93 L K M D . A s an advisory board, the Village Consultative Council ( L M D ) , has been set up to approve annual development plans and budgets. Agricultural Development Policies Overcoming Rice Deficiency Rice is the main staple food for the majority of Indonesia's 200 mil l ion people. During the first four decades following the proclamation of independence in 1945, Indonesia had to import large quantities of rice mainly from Burma, Thailand, Japan and the United States to maintain adequate food stocks to feed its people. For external security reasons and to maintain internal social stability, in the early 1960s the government began to envisage an agricultural program to achieve self-sufficiency in rice production. The rice deficiency was a drain on scarce foreign exchange, and it was also perceived as a political weakness in Indonesia's international relations. In the government's view, i f the domestic supply of rice could not be supplemented by international markets—whether for political, economic or other reasons—the stability and well- being of the country might be seriously threatened. Even i f supplies of rice were available on international markets, fluctuations in international prices might have destabilizing effects within Indonesian society. Studies which were carried out on a limited scale during the early and mid 1960s, led to a concerted effort in the first five-year development plan (1969-1973) to increase rice production on the island of Java, which is the most densely populated part of the country and the most rice- deficient. B y the end of the first five-year plan, the government laid plans to spread the rice- intensification program to the other islands during the next plan period, and the third plan placed more emphasis on other crops, such as potatoes, maize and soybeans, shifting the emphasis from rice-sufficiency to overall food self-sufficiency (Mears, 1981; Sajogyo and Wiradi , 1985). 94 Although the program was very successful during the 1970s in increasing productivity per unit of paddy land, the total consumption of rice increased rapidly because of population growth during this period. A t the beginning of the 1980s, Indonesia was the world's biggest importer of rice and despite great achievements of the agricultural intensification program during the previous decade, the goal of self-sufficiency in rice seemed as remote as ever. Some economists (Mears, 1981: 50, 419, 422) were doubtful that self-sufficiency could be achieved permanently, in either rice or other food, because of the high growth rate in food production that would have to be sustained over a number of years. The cost of implementing this program was very high, but thanks to the government's determined efforts and willingness to absorb much of the costs during the critical period of the 1970s and early 1980s, the overall goal was eventually reached. B y 1984-1985 Indonesia was self-sufficient in food production. Rice Production Policy A combination of macro economic management and sectoral policies are key factors in achieving agricultural development objectives. A t the macroeconomic level, adoption of a flexible exchange rate policy, fiscal and monetary policies which help control inflation, and liberalization of foreign trade are essential for increasing the competitiveness of Indonesia's agriculture and spurring domestic economic growth. Since the 1960s the agricultural sector has been allocated a key position in the plans and funds were made available according to this investment priority status. Rural development continued to emphasize intensive rice production. The largest contribution to growth in the food crops and agricultural sectors has been from rice production. Since 1977 rice production has grown at the rate of over 6 percent per year (Darmawan and Hermanto, 1993). This remarkable rate of growth has been achieved mainly due to government policies to support rice production. 95 In the 1970s and 1980s the policies included investment in expansion and improvement of irrigation, investment in research capacity to develop rice varieties adapted to Indonesian conditions, rice intensification programs to encourage dissemination of new technologies and inputs, rice price support and stabilization policies, and investment in rural infrastructure. The main rice production policies which have contributed to the rapid growth in production are found in several rice intensification programs. The first rice intensification program introduced in the mid-1960s was called B I M A S , which is an abbreviation of the Indonesian name, Bimbingan Masai, meaning "guidance to the masses". Through the implementation of B I M A S programs, farmers were provided with basic service packages. These programs included extension, short-term credit and heavily subsidized inputs such as High Yielding Variety ( H Y V ) seeds, fertilizers and pesticides. The Agriculture Ministry provided extension services through its officers located in subdistrict levels. The local branches of the Indonesia People's Bank (BRI) 3 handled the credit supply to farmers, while the Home Affairs Ministry was responsible for the implementation of the programs. Due to problems caused by low repayment rates, lack of qualified extension personnel and the untimely provision of many inputs, a new improved B I M A S program was introduced in 1970. In this program, the village heads' use of coercion to elicit farmers' participation was abandoned. In the new B I M A S , "village unit areas", which were clusters of three or more villages, became the basis of delivery institutions such as the village cooperative, the village unit bank, the agricultural extension field staff and the private kiosks which stock various farm inputs. 2 The term "masses" refers to the millions of individual farmers in Indonesia and especially to those on the densely populated island of Java. "Guidance" in this context refers to the government's intention to provide, on a basis of voluntary acceptance by farmers, an integrated package suitable for individual family farms, which would enable the farmer to increase productivity per unit of cultivated land by adopting the new techniques. 3 A state bank appointed by the central government to support agricultural development. 96 A Food Logistic Agency or Badan Urusan Logistik ( B U L O G ) guaranteed the purchase of rice at a floor price. A raise in the rice yield was generally the result of this revamped B I M A S . However, after a few years, mainly due to the massive pestilence o f the brown rice plant hopper and the accumulated debt problems of participating farmers, growth in output slowed down considerably. The second program, introduced in 1973 and rather similar to B I M A S , was called I N M A S (an abbreviation of Intensifikasi Masai, or "mass intensification" program). In this program, cash loans were no longer provided. The program was introduced mainly with the intention of providing services to those farmers who could not be given new loans because of their accumulated debts arising from their participation in B I M A S , and to those farmers, such as tenants, who did not qualify for B I M A S (Hardjono, 1983). Because of the unavailability of credit for the participants of I N M A S , the incentive to jo in the program was limited and by the early 1980s the total number of participants in B I M A S and I N M A S had decreased from 3.6 mil l ion in 1974 to about 1 mil l ion. The third program called INSUS (an abbreviation of Intensifikasi Khusus, or "special intensification" program) was introduced in 1979. Its introduction was necessitated by the pest control requirements at the local level. Research had shown that the rice hopper flourished under those conditions usually present in village areas where the crops in the various rice fields ripened successively. The hopper could attack and destroy field after field in swarms, thereby, resisting its enemies. Rice cultivation in the village areas had to be coordinated so that all village areas could be planted at the same time, creating less favorable opportunities for the brown rice plant hopper (wereng) to wreak their destruction. Hence, it is clear that INSUS differed from B I M A S and I N M A S in that it focused on group farming. A l l owners of a sizeable piece of well-irrigated land (25-50 hectares) that had been earmarked for intensification were obliged to participate. The 97 farmer groups received financial support and decided on the timing of activities and on the application of the various input packages which were made available. A n extension of the program (called O P S U S or "special operation") was introduced in the early 1980s in an attempt to bring the services to areas not yet covered by the programs. The fourth program is called S U P R A I N S U S ("super special intensification") and was introduced in 1987. The program has been created as a further extension of INSUS and O P S U S and is aimed at specific areas as designated by the Ministry of Agriculture. The backbone of S U P R A I N S U S activities consists of the following. First, there is the distribution and application of packages which include High Yielding Variety ( H Y V ) seeds, solid and liquid fertilizers, and chemicals for integrated pest and disease control. Second, there is the organization of irrigation water control and harvest and post-harvest treatment; and third, the extension of soil cultivation, planting (among other aspects, to ensure that densities exceed 200,000 plants per hectares), plant nursing and annual rice variety rotation. The decision on the actual application of special inputs packages is made at the level of the sub-units, called farmer groups, comprised of some 600 to 1000 farmers, or at the level of tertiary irrigation system units of 90 to 150 hectares (Government of Indonesia [GOI], Department of Agriculture, 1987). Table 3.1 Rice: Program, Area Harvested and Total Production per annum, 1960-1988 (1 unit = '000,000 ha/'000,000 ton) Year Program/ Total Total Y i e l d (in Technology Area Production metric Harvested ton/ha) 1960 N o Program 7.28 8.76 1.20 1970 B I M A S 8.14 13.14 1.62 1980 I N M A S 9.00 20.16 2.24 1984 INSUS 9.76 25.93 2.66 1988 S U P R A I N S U S 10.14 28.40 2.86 Source: Modified from Mears, 1984; E I U , 1989. 98 Statistics regarding the special rice programs, rice areas harvested, rice production and the average yields per hectare are shown in Table 3.1. The data indicate that the total production of rice has greatly increased as a result of expansion of rice field areas. Since the 1970s onward, rice productivity has been substantially increased. Thus, the combination of expanded rice field areas, improvements in the irrigation infrastructure, and the intensification in rice cultivation through the application of High Yielding Varieties ( H Y V ) , fertilizers, biocides and more efficient water use, has led to attaining the national goal of self-sufficiency in rice. In the early 1990s Indonesia's central government (through B U L O G ) quietly imported rice from Vietnam. The main justification given by the central government was that the rice imports were needed to maintain the nation's rice stocks. However, it can also be argued that despite the programs and technology aimed at increasing rice production, and the rice field areas available, rice production could no longer be increased. In other words, the optimum combination of high technology inputs applied to each hectare of rice field had reached it utmost productive limits. Realizing these limitations, in 1995 the central government (through the Ministry of Agriculture) decided to improve rice production for self-sufficiency through a program called "a mil l ion hectares for rice field" in swamp areas in Central and South Kalimantan. Although the project has been running for more than one year, the results for rice production have not yet been published. Market Intervention Policy Besides the programs for rice intensification, irrigation development, and development and dissemination of modern varieties of rice, the main intervention policies aimed at increasing rice production are marketing and rice price supports and fertilizer subsidies. 99 The government is very conscious of the decisive role of rice in the general economy. During the 1950s and 1960s when the national economy was in serious disorder, rice shortages occurred frequently as did shortages of other essential commodities. In such periods the price of rice inevitably influenced the prices of other foodstuffs and necessities of life. Control of rice prices therefore had the effect of stabilizing a large part of the economy. The main instruments of the rice price control policy have been a ceiling price for consumers, floor price for farmers, and control of the international trade in rice. The central government has delegated the National Logistics Agency ( B U L O G ) the responsibility to control the supply of goods (particularly rice and sugar) and set their prices throughout the year. B U L O G has utilized procurement of rice to defend the floor price, and has been successful since the mid- 1970s in maintaining the reported floor price. It was not until 1985, following two large harvests in 1984 and 1985 and a large build-up in stocks, that the farm price dropped below the reported floor price. The ceiling price has been maintained mainly by supplying urban markets from domestic procurement, imports and stocks. The basic concept of the price policy was developed by Saleh A f i f f and Leon A . Mears in 1969 (in Amang, 1993). It consisted of five elements: firstly, the floor price should be high enough to stimulate production. Secondly, the ceiling price level should be reasonable for consumers. Thirdly, the price margin should be maintained at a reasonable level to encourage traders. Fourthly, domestic prices should be protected from unstable world prices, but always adjusted to minimize subsidies. Finally, a minimum stock should be maintained in order to implement the policy. In order to implement the rice policy, B U L O G has also built rice storage facilities throughout the country. The relatively narrow band between B U L O G ' s floor and ceiling prices of rice has discouraged the private sector from participation in holding stocks of rice. This has 100 forced B U L O G to maintain large amounts of stocks to keep the market price within the ceiling and floor prices. Budgetary costs of purchasing and maintaining such large stocks have become very high. In addition, the government has employed the fertilizer subsidy as a key instrument to stimulate crop production, particularly rice. The government subsidy for fertilizers has allowed a steady decrease in real prices of fertilizer from 1970 through 1984 (Darmawan and Hermanto, 1993). In order to set farm-level fertilizer prices, the government has become heavily involved in the production, trade, and distribution of fertilizer. The rapid growth in fertilizer use, induced in part by the subsidy and accelerated by the adoption of modern varieties and massive investments in irrigation, has sharply increased the budgetary burden of the subsidy. Expansion of rice production was the overriding concern of agricultural policies in the 1970s and the 1980s. However, a series of changes in the Indonesian economy in the mid-1980s have required a substantial broadening of the agricultural policy concern beyond rice production issues. It seems that in the future, rice wi l l contribute less to the growth of the agricultural sector. This is due to the technical limits to land and yield increases, and also to the changing nature of demand which requires less growth in rice production than was the case in previous years. Transmigration Program and Regional Development Aims of the Transmigration Program The present transmigration program is primarily based on the government sponsored resettlement of transmigrants from Inner Indonesia (Java, Madura, Ba l i , and Lombok islands) to agricultural settlement areas in the Outer Islands. These sponsored transmigrants are preferably selected from young, male-headed, and landless farmer households. On arrival they are allocated 101 a two hectare farm lot (depending on the quality of the land), as well as a preconstructed house with a garden. Most of the farm area usually has to be cleared by the transmigrants themselves. In addition, the transmigrants are supplied with food, tools, and fertilizer during the first year in the settlement. Besides this flow of government sponsored migrants, there is also a consistently increasing flow of spontaneous migrants, who usually jo in their relatives in the established settlements before starting a living of their own. This secondary group of transmigrants was estimated to be about one-third of the total flow (around 3,774,166 people) of sponsored migrants who had been resettled by 1989 (Government of Indonesia, 1990). The government seeks to encourage an increase in this spontaneous flow because it is so much cheaper and adds to the effectiveness of the transmigration program. The major aims of the present transmigration policy are: first, to achieve a more favorable distribution of the national population and the labor force; second, to develop new resources and productive areas in the Outer Islands, mainly through agricultural resettlement; third, to increase living standards in both the areas of origin and destination of the transmigrants; and finally, to integrate the national territory and foster national unity by bringing together the various ethnic groups and cultures (Government of Indonesia, 1994). Although these aims have been persistent over time (e.g., five-year development plans I- VI) , their stress and mixture sometimes have changed considerably. This is especially true for the demographic aim which is not mentioned explicitly, i.e. alleviating population growth and pressures in Java. This aim's rationale is based on the argument that Java and Bal i have 63 percent of the national population on almost 8 percent of its territory. Thus, the islanders' problems of landlessness, rural poverty and environmental deterioration, which can be solved only by extensive population redistribution measures (Nitisastro, 1970; Arndt and Sundrum, 102 1977, Arndt, 1983). Whenever authorities become nervous about Java's continuing population growth and the problems of curbing it through family planning, the demographic issue surfaces in such forms as the necessity of distributing the population and supply of labor for national development purposes. The persistence of this argument is clearly reflected in the very high target figures set for the transmigration program of the Five-year Development Plan IV (envisaging the settlement of 465,000 families) and in the Five-year Development Plan V (decreasing4 to around 175,000 families). Although the target figures are dropping, the program is still the world's biggest resettlement effort in history. In fact, Java has experienced a net outmigration for more than two decades. More than three mil l ion of its inhabitants have been moved out, who might otherwise have burdened Java's local economy and environment. M u c h of this achievement has been realized at high and ever increasing economic, social and environment costs. Many of these costs might have been avoided i f the government had taken a more realistic stand towards some of the program's basic assumptions and expectations. Within the framework of the present transmigration policy, various aims are mutually contradictory. The aim of alleviating demographic pressures on Java together with the political aim of national integration are in fact causing great troubles. Transmigration in North Sulawesi North Sulawesi received one of the first four projects established by the Indonesian transmigration authority after independence in 1945. Paguyaman Subdistrict in Gorontalo District was established as a settlement for transmigrants from Java, especially Central and East Java; in 1953. Since it progressed well , transmigrants were sent there throughout the 1950s, resulting in around 640 households or 2,616 inhabitants. In 1968, when this project was finally 4 This is due to constraints in the central government's budgetary allocation for transmigration programs. 103 transferred from central government to local government, (which became fully accountable for further developing the settlement areas), the project had over 4,000 migrants (Hardjono, 1977 and Provincial Department of Transmigration, 1994). A further history of the transmigration project on North Sulawesi follows. In 1962 a small group of transmigrants (88 families and around 163 people), originally from Central and East Java, were settled in Paguyaman Subdistrict. During the 1970s three groups of transmigrants (around 1,600 families or 6,883 settlers) from West Java, East Java, and Ba l i were resettled in a new project known as Bongo I, Bongo II, and Bongo III villages in Paguyaman Subdistrict. During the 1980s, groups of migrants (consisting of 2,700 families or about 11,472 settlers), mostly from West Java, East Java, Bal i and East Nusa Tenggara were sent to new project areas called Marisa I, Marisa II, and Marisa III in Marisa Subdistrict of Gorontalo District. Most of the Bongo and Marisa villages were designed for commercial crops cultivation. New settlements were also established in two villages, Werdhi Agung in 1963 and Kembang Mertha in 1964, in Dumoga Subdistrict of Bolaang Mongondow District. The transmigrants settled in these areas were some of the victims of the Mt . Agung volcanic eruption in Ba l i . With relatively limited assistance from the transmigration authority, the resettled Balinese have proved as industrious and resourceful as they have in other transmigration projects such as in Parigi Subdistrict, Donggala District, Central Sulawesi. The locations for these two transmigrant villages in Dumoga Subdistrict were well chosen, since local terrain made Balinese-style irrigation possible, soil was fertile and no disputes occurred with local people about land matters. The populations of Werdhi Agung and Kembang Mertha rose from 1,459 and 988 migrants respectively, to a total of 3,649 and 2,360 inhabitants respectively in 1993. The population increased a direct consequence of births and the arrival (from Bali) of independent migrants attracted to the new areas. A total area of 1,270 hectares is 104 under cultivation for rice, corn, soybeans, and groundnuts, all of which can be marketed easily to the rural center in Imandi and the small town in Kotamobagu. Table 3.2 Sponsored and Spontaneous Transmigrants From Java and Bal i Settled in North Sulawesi Year Families People Sponsored: 1950s 640 2,616 1960s 682 2,610 1970s 2,560 11,390 1980s 2,700 11,472 1990s 250 963 Spontaneous: 1960s-1980s 1,479 4,923 Total 8,311 33,974 Source: Provincial Department of Transmigration, 1994 In 1971 a new project was established at Tumokang in the Dumoga Subdistrict with 60 families (287 settlers), from Central and East Java. In the period o f 1972-1975, 500 families (2,475 migrants) from Central and East Java and Bal i were settled in Mopuya Village. Another group o f around 400 families o f fully sponsored migrants (1745 settlers) from West Java and Ba l i were settled in Mopugad Village. The population of the three villages of Tumokang, Mopuya, and Mapugad, increased from 4507 settlers in 1975 to a total of 9,556 inhabitants in 1993. These new settlement areas were designed on a three-part system in which one-third of the land is used for fully sponsored migrants, one-third for independent migrants, and the resettlement o f local people, and the remaining third for future expansion of commercial crops cultivation. During 1983-1984 there were around 500 families or 2,608 local people, the Bolaang Mongondownese, resettled in Torosik Village and Onggunoi Village, both villages located in Pinolosian Subdistrict of Bolaang Mongondow District. During the 1990s the transmigration program in North Sulawesi focused mainly on local people, with around 1,450 families (or 6,735 105 settlers) relocated in the new settlements of Pusian and Malango villages in Bolaang Mongondow District and Wonggarasi and Marisa V villages in Gorontalo District. These local migrants were from four ethnic groups from four districts in North Sulawesi: Sangihe Talaud, Minahasa, Bolaang Mongondow, and Gorontalo. The majority of these local migrants have been located in commercial crops cultivation areas which are not supported with irrigation facilities. Effects of the Transmigration Program on Regional Development It is already apparent that the transmigration program has significantly influenced demographic aspects, use of natural resources, and living standards in North Sulawesi, and more specifically in the two districts of Bolaang Mongondow and Gorontalo. Transmigrants have increased the supply of food, especially rice, soybeans, and corn. The transmigration program in North Sulawesi (especially in the case study area which is the center of rice production in the region) has significantly contributed to the increase of rice production in the province as a whole. Data from North Sulawesi in Figures, (published in 1995 by the provincial government of North Sulawesi) show that in the early 1970s North Sulawesi produced around 177,895 tons of rice per year, and 391,186 tons per year by 1994. Bolaang Mongondow and Gorontalo districts contributed around 31.5 percent and 43.0 percent respectively of the total production. The production of soybeans increased from 1,782 tons per annum in the early 1970s to 26,370 tons per annum in 1994. Both Bolaang Mongondow and Gorontalo District shared about 67.0 percent and 31.7 percent respectively of the total soybean production. Corn production increased from 68,942 tons per year in the early 1970s to 135,693 tons per year in 1994. Bolaang Mongondow and Gorontalo district supplied about 14.0 percent and 29.1 percent respectively of total corn production. Since the late 1980s North Sulawesi has been exporting corn to other regions and countries as well . 106 The most significant impact of transmigration was on the region's infrastructure. Access and main roads were constructed during site development, resulting in around 14 percent of all roads maintained by district governments (especially, Bolaang Mongondow and Gorontalo district) in the 1980s. Many of these transmigration roads are poorly maintained and place a heavy burden on district public works offices when transferred to the province. However, a reliable transportation network is essential for the region's transmigrants for marketing their agricultural commodities and finding off-farm jobs and maintaining household income. Transmigration sites are also provided with a host of public facilities such as schools, health facilities, agricultural input suppliers, market-places, religious facilities, and extension centers which are put in place in each settlement cluster. These facilities are frequently superior to those in surrounding areas and serve the local non-transmigrant population to the degree that service personnel are available and access is not constrained by distance and travel time. The transmigration program has had a substantial effect on the budgetary allocations made in the province's favor. Both during 1979-1982 and the 1985/86 financial year, an above average proportion of the development budget (in national terms) was financed out of funds set aside for transmigration. In 1985/86, more than 20 percent of all the money available to the province for development investment came from the transmigration budget. Due to lack of data on the precise pattern of expenditure, it is not possible to quantify the direct income and multiplier effects on economic development in the region. It is, however, quite reasonable to assume that marked growth and employment effects have occurred. Problems of Transmigration Program Weighed against these positive impacts are negative ones (Arndt, 1983). In this sense the impact of settlements on the often fragile ecosystems of the Outer Islands is now a matter of 107 strong national concern. Environmentalists have pointed to the extended impact of the burning and clearing o f tropical forests, which results in the destruction o f certain tree species, as well as other forms of plant and animal life (Secrett, 1986). The pursuit of national unity by means of integrating local people with transmigrants from Java and Ba l i is frequently disturbed by forced attempts to bring them together into the same schemes. The rationale behind this is that the local population should also enjoy the advantages o f the transmigration program facilities in order to prevent local feelings of jealousy. For this reason 25 percent of the participants are local transmigrants or translok. In reality there are many barriers to this planned integration. The sheer volume of transmigrants may already have caused social unrest among the local population, who fear that they may become a cultural minority in their own homeland. One such disputed case has been the scheduled settlement on Irian Jaya of some 690,000 transmigrants from Java during the period of 1984-1989, a plan which increased the local population by 54 percent. This quantitative integration problem may be aggravated by large cultural and economic differences which make it impossible to blend the two groups in one settlement project or production system. The two different communities have different types of social organization and modes of production. There is a clear contrast between the communally organized indigenous people as to compared the individually operating and commercially oriented Javanese transmigrants. Conflicts frequently arise from different systems of land tenure and property relations, aggravated by the lack of suitable land for transmigration sites (Soetrisno, 1985; Mubyarto, 1985). Another important issue concerns the management and planning problems in transmigration schemes which ensue from plans hastily devised in order to fulfill the target figures. This becomes evident from the first stages of the land evaluation and feasibility studies. 108 The surveys are often carried out in a rather haphazard way and in a very short time (around two months), with insufficient field checks on soil quality (Evers and Gerke, 1992). The costly feasibility studies, usually carried out by foreign consultants, disclose that on average only 20-25 percent of the original surveyed areas are fit for human settlement. However, the authorities frequently try to raise this percentage (against the consultants' advise) in order to place the targeted number of transmigrants. A study done by the Land Resources Development Center (U .K) , for example, concluded that although only about 75,000 hectares in Central Kalimantan were suitable and available for transmigration sites, government targets projected the clearance of nearly seventeen times as much forest between 1979-1989 (Secrett, 1986). This planning system—devised to meet over-ambitious targets—is inviting haphazard solutions because it leaves no time nor flexibility for plans to mature. City Size and Function According to a Government of Indonesia Report (1994) a city is defined as a region for settlement with a relatively high population density and main economic activities based on a sector other than agriculture. The urban community is a heterogeneous society because it consists of both indigenous people and migrants who have come from other cities, provinces, and regions. The inhabitants also differ in terms of main occupation, culture, ethnicity, and religion. In Indonesia, a city has its own government organization such as local government level I (equivalent to a provincial government in the case of Jakarta), or local government level II (for a provincial capital, municipality, or administrative center). District capitals, subdistrict cities and/ or rural centers do not have their own city governments, but are governed directly from the district government and subdistrict government levels respectively. 109 Based on population size, cities are classified into five types, as indicated in Table 3.3. These cities have different functions in the provision of services, for example the cities can be classified as having international, national, regional (servicing one province or more) or local (servicing several districts or a part of one district) linkages. Table 3.3 Type of City and Population Size Type of city Population Scale Megapolitan more than 5 mil l ion Metropolitan 1 mil l ion to 5 mil l ion B i g City 500,000 to 1 mil l ion Medium City 100,000 to 500,000 Small City 20,000 to 100,000 Source: Government of Indonesia, 1994. Cities or urban areas can form a system because of physical, social, and economic linkages with one another. In formulating development plans and policies that focus on such linkages, cities or urban areas are divided into four groups based on their roles and services functions in supporting national economic growth (Government of Indonesia, 1994). First, there are cities or urban areas which function on a national scale as the main gate for the flow of domestic goods and services, and also serve as an international trade center. These areas are also the centers for services, production and distribution, and main transit hubs for transportation reaching other lesser centers in the regions or provinces. Metropolitan and big cities are included in this group because they have a relatively complete main infrastructure. Second, there are cities or urban areas which function as centers of regional activities. These cities cover and service some districts as centers of services, production and distribution, and are transportation hub for access to and from regions or districts. These cities are usually big and medium cities. Third, there are cities or urban areas which function as a center of local activities. These urban areas service regions located in the district and consist of medium and small cities. Finally, there are 110 cities or urban areas which have special services functions in support of developing strategic sectors, developing new regions, or distributing economic activities. The special services cities also function as buffer-zone areas of agglomeration growth centers which are already existing in those areas. Why do Medium Cities and Small Towns need to develop? Population Growth in Medium Cities and Small Towns The reasons and urgency behind efforts to develop medium cities and small towns can be identified by looking at population growth rates, especially during the decade of 1980-1990, as indicated in Table 3.4. The list of cities that were classified as a strategic cities in Long-Term Development Plan II (1994/95-2018/19), includes many medium cities and small towns which have population growth rates exceeding the national urban population growth rate (5.36 percent per year) (CBS , 1990). The evidence also suggests that many medium cities and small towns outside Java are in conditions that require development, even though around 69 percent of Indonesia's total urban population is concentrated on Java and Madura islands. Medium cities and small towns located outside Java have been playing important roles in regional development activities. They are centers of accumulation, storage, processing, and marketing of agricultural products from rural areas surrounding cities. There are also centers for producing and distributing the manufactured products which supply both urban and rural communities. They are also services centers for administration, education, health, information, and culture serving not only urban communities but also the rural communities where the majority of Indonesia's population live. In transmigration areas, small towns are crucial centers for marketing of agricultural production, and supply and distribution of manufactured products such as consumer goods and agricultural inputs. Consequently, medium cities and small towns I l l generate regional economic development by creating new job opportunities and improving local income. Most cities outside Java fall under the classification of medium cities and small towns, based on populations. However, to honor the national development commitments and in order to equally distribute development beyond Java, and especially in the eastern part of Indonesia, the growth of the medium cities and small towns in regions such as Ujung Pandang, Palu, Kendari, Manado, Ambon, Biak, Timika and Jayapura has become a central issue for development. When these cities function as accelerators and centers of regional development, they have an important role as a center of social, economic, and political activities in the eastern part of Indonesia. In order to accelerate the pace of regional development in the eastern part of Indonesia so that it can catch up with the very rapid development in the western part of Indonesia, the development of medium cities and small towns must not be subject only to the considerations or criteria of population size and economic activities. In contrast, development of the medium cities on Java needs to be put in a broader context. These cities have relatively larger populations, are located near to one another, and are supported by good roads and transportation networks. The development of medium cities on Java can not focus on one individual city in isolation. Rather, the development must consider several cities and their interconnections. The physical linkages may be so strong that it is almost impossible to distinguish the boundaries between them ( N U D S , 1985; Firman 1991). Table 3.4 Strategic Cities in Long Term Development II (1994/95-2018/19) Total Population Population Growth (%) Strategic End of End of 1980- Repelita V I Cities Repelita V Repelita V I 1990 (1993/94- 1993/94 1998/99 1998/99) A . Metropolitan 1. Jakarta 15,524,000 20,000,000 5.80 5.20 2. Surabaya 3,967,000 4,967,000 4.80 4.60 3. Bandung 3,791,000 4,657,000 4.60 4.20 4. Medan 2,557,000 3,141,000 4.80 4.20 5. Semarang 1,401,000 1,608,000 2.80 2.80 6. Yogyakarta 1,310,000 1,461,000 7.80 2.20 7. Palembang 1,287,000 1,529,000 3.90 3.50 8. Malang 1,254,000 1,563,000 5.00 4.50 9. Tegal 1,191,000 1,520,000 6.80 5.00 10. Ujung Pandang 1,164,000 1,423,000 4.10 4.10 11. Surakarta 1,091,000 1,302,000 3.90 3.60 B. Big Cities 1. Cirebon 985,000 1,142,000 2.60 3.00 2. Kediri 770,000 946,000 5.60 4.20 3. Banjarmasin 634,000 764,000 3.90 3.80 4. Pekalongan 628,000 782,000 5.10 4.50 5. Padang 575,000 726,000 5.00 4.80 6. Bandar Lampung 548,000 651,000 4.30 3.50 C. Medium Cities 1. Denpasar 497,000 714,000 8.50 7.50 2. Pontianak 485,000 593,000 4.10 4.10 3. Kudus 461,000 617,000 7.90 6.00 4. Pekanbaru 429,000 574,000 6.40 6.00 5. Tasikmalaya 425,000 505,000 4.10 3.50 6. Samarinda 418,000 567,000 6.30 6.30 7. Manado 407,000 495,000 3.60 4.00 8. Pasuruan/Probolinggo 399,000 481,000 4.00 3.80 9. Jambi 385,000 516,000 6.90 6.00 10. Madiun 385,000 437,000 2.70 2.60 11. Purwokerto 375,000 478,000 6.00 5.00 12. Balikpapan 357,000 435,000 4.00 4.00 13. Mataram 350,000 415,000 3.60 3.50 14. Serang 326,000 432,000 6.80 5.80 15. Jember 309,000 349,000 2.70 2.50 16. Garut 293,000 340,000 3.20 ' 3.00 17. Pematang Siantar 285,000 330,000 3.40 3.00 18. Kisaran/ Tanjung Balai 265,000 354,000 8.50 6.00 19. Ambon 252,000 327,000 6.20 5.40 20. Cilacap 227,000 259,000 2.90 2.60 21. Bengkulu 218,000 335,000 16.30 9.00 22. Klaten 211,000 245,000 4.90 3.00 23. Karawang 210,000 282,000 7.10 6.00 24. Palu 204,000 286,000 8.70 7.00 Table 3.4 Continued Total Population Population Growth (%) Strategic End of End of 1980- Repelita V I Cities Repelita V Repelita V I 1990 (1993/94- 1993/94 1998/99 1998/99) 25. Banda Aceh 179,000 240,000 7.10 6.00 26. Kupang 162,000 202,000 4.90 4.50 27. Jayapura 150,000 190,000 4.80 4.80 28. Batam 147,000 259,000 16.40 12.00 29. Pangkal Pinang 138,000 160,000 3.80 6.00 30. Lhokseumawe 134,000 180,000 9.80 6.00 31. Kendari 130,000 190,000 9.10 8.00 32. Sukabumi 126,000 140,000 0.90 2.00 33. Magelang 125,000 132,000 -0.02 1.00 34. Situbondo 124,000 149,000 6.40 3.80 35. Palangkaraya 123,000 164,000 6.80 5.80 36. Kotabumi 117,000 153.000 9.00 5.50 37. Purwakarta 108,000 127,000 4.50 3.20 38. Gorontalo 108,000 138,000 4.00 4.00 39. Tembilahan 100,000 128,000 5.10 5.00 C. Small Towns 1. Sorong 98,000 131,000 9.10 6.00 2. Dumai 93,000 113,000 4.30 3.80 3. Pare-Pare 93,000 108,000 3.00 3.00 4. Singkawang 88,000 107,000 3.00 4.00 5. Tarakan 87,000 105,000 2.30 4.00 6. Singaraja 85,000 103,000 3.30 4.00 7. Ternate 81,000 106,000 10,90 5.50 8. Bukittinggi 80,000 95,000 2.60 3.50 9. Sibolga 77,000 90,000 1.90 3.00 10. Watanpone 77,000 96,000 5.60 4.50 11. Bojonegoro 72,000 84,000 1.10 3.00 12. Baturaja 63,000 80,000 7.40 5.00 13. Palopo 63,000 73,000 3.20 3.00 14. Raba-Bima 61,000 75,000 2.50 4.50 15. Ende 57,000 71,000 6.10 4.50 16. Sumbawa Besar 56,000 70,000 5.50 4.50 17. Lubuk Linggau 55,000 69,000 6.10 4.50 18. Sampit 54,000 76,000 10.00 7.00 19. Di l i 52,000 67,000 - 5.00 20. Kotabaru 50,000 59,000 9.80 3.50 21. Rantau Prapat 48,000 58,000 5.20 4.00 22. Biak 44,000 54,000 4.20 4.50 23. Maumere 42,000 51,000 6.20 4.00 24. Manokwari 39,000 47,000 3.20 4.00 25. Ubud 29,000 40,000 11.20 7.00 26. Tual 27,000 30,000 14.90 2.00 27. Buntok 21,000 28,000 7.40 6.00 28. Muaratewe. 20,000 25,000 - 5.00 Note: Repelita is a five-year development plan Source: Government of Indonesia, 1995. Five-year Development Plan 1994/95-1998/99, Book II. V I , 114 It has been predicted that the population of the strategic cities listed in Table 3.4 w i l l hit around 63.3 mil l ion people by the end of Five-year Development Plan V I (1998/99). This number is around 77 percent of the projected total urban population (around 82.4 mil l ion people). B y the end of Long Term Development Plan II, the population in strategic cities w i l l reach 114.3 mil l ion people or around 79 percent of the projected total urban population of 143.8 mil l ion inhabitants (Government of Indonesia, 1995). The data also indicate that of the eleven cities classified as metropolitan cities, eight are located on Java, two (Medan and Palembang) are located on Sumatera, and one city (Ujung Pandang) is located on Sulawesi. O f the big cities, three (Cirebon, Kedir i , and Pekalongan) are located on Java, two (Padang and Bandar Lampung) on Sumatera, and one city (Banjarmasin) is located on Kalimantan. Thus, the location of both metropolitan and big cities is mostly concentrated on Java, while four of the cities are found on Sumatera, and one city each on Kalimantan and Sulawesi. The patterns of spatial distribution of medium cities show a concentration on three islands; of the 39 cities, there are 15 cities on Java, 10 cities on Sumatera, and 5 cities on Kalimantan. The remaining 9 cities are distributed thus: 4 cities on Sulawesi, and one city each on Ba l i , West Nusa Tenggara, East Nusa Tenggara, Maluku, and Irian Jaya. The locations for small towns are mainly distributed outside Java. There is only one strategic city located on Java, 9 cities on Sumatera, 4 cities on Kalimantan, 3 cities on Sulawesi, 6 cities on Ba l i , West Nusa Tengara, East Nusa Tenggara, and East Timor, and 5 cities on Maluku and Irian Jaya. In other words, it can be argued that the location of urban development for metropolitan, big cities, and medium cities is concentrated in the western part of Indonesia, and it is only at the level of small towns that there is a balanced distribution between the western and eastern parts of Indonesia. This is not surprising since the majority of Indonesia's population is concentrated in the western 115 part of Indonesia, which is more developed in terms of basic infrastructure including road and transportation networks, airports, ports, and communications for supporting economic activities. It is also the location of most big industries and manufacturing activities. Rural-Urban Areas Development and Policies The development of urban and rural areas needs a comprehensive approach and integrative implementation which can increase the role and direct initiative for participation with the motivation of mutual assistance of communities. A s stated in ( G B H N ) 1993, development is to be implemented by communities and government. Thus, community is the main actor in development, while government has responsibility for directing, assisting, guiding, and creating conditions to support implementing development. Furthermore, in the development of rural and urban areas priority is given to balancing the growth rate of development between rural and urban areas. From Five-year Development Plan I (Repelita I) 1969/70-1973/74 up to Five-year Development Plan V (Repelita V) 1989/90-1993/94, the development and dynamism o f urban areas has increased and cities have become important as centers for economic activities and as proponents for regional and national development. Urban areas are seen as centers of modernization and technological innovation, centers of social and cultural activities, centers of education and arts, and as gateways in connecting with other countries. The role of rural areas in national development was also seen as substantial as development is still dominated by the agricultural sector in the guest for national rice self-sufficiency. In establishing national and regional development, rural and urban areas are complementing each other in an interdependent, interconnected system. The contributions of rural and urban areas to each other's development are varied and essential: providing main foods, 116 services and basic facilities; providing raw and semi-raw materials, and mastering human resources for industry and other economic activities. Interlinkages of mutual benefit like this are keystones for development of rural and urban areas. During the early Long-Term Development Plan I (1969-1994) the orientation of ( development mostly emphasized achievement of sectoral targets. Villages and cities were getting relatively less attention although they required special attention. With the successes of sectoral development, Five-year Development Plan IV (1984-1989) was the start of more serious attention being given to spatial dimensions in planning and implementing development especially in rural and urban areas. Conditions such as limited job opportunities, shortage of available land, and the limitation of basic infrastructures in rural areas have pushed rural people to migrate to cities, resulting in major impacts for both rural and urban areas. The basic infrastructure provided in urban areas is usually not adequate to meet the rapidly increasing needs of huge numbers of migrants flowing from rural areas. Limited job opportunities in urban areas are a main cause of increasing unemployment and the growing activities of the informal sector. The gaps in lifestyles between urban and rural people, and among community groups in urban areas, are reflected in the differences in wage rates, availability and accessibility to basic infrastructures. These problems all decrease economic productivity and perpetuate poverty in both rural and urban areas. A s a part of regional development, developing rural and urban areas requires special and thorough attention from both central and local governments. The problems arising both in rural and urban areas are connected to each other, which makes attempts to solve such problems in isolation even more difficult. Rural and urban areas are a single unified entity, a region, that requires integrated and comprehensive development management. The rural-urban areas 117 approach is a readjustment in establishing sectoral development which gives special attention to the linkages between rural and urban areas. The social and economic linkages between rural and urban areas are the foundation for formulating future development policies for both rural and urban areas. The Challenges and Constraints of Rural-Urban Development The development of both rural and urban areas faces some serious challenges and constraints. First, the number of poor people is still high in absolute terms (around 27.2 mil l ion Indonesians). This is the main problem to be tackled in developing rural and urban areas. Poverty in rural and urban areas is strongly related to low levels of education, skills, and health, disadvantages which limit the ability of people to get a job and earn enough income to support themselves. Another factor is the absence of or limitations on infrastructure and transportation networks connecting poor regions to more advanced areas, therefore, stifling opportunities for growth. Some regions lack the natural resources that could be used for development. Thus, they remain poor. Second, limitations on the quality of human resources have direct effects; including low productivity and fewer opportunities for people to actively participate in development, especially in rural areas. Thus, the main challenge is to prepare and upgrade the skills of rural and urban communities in adopting new technology so that community members can directly participate in development. Third, increasing the rate of development requires utilization of additional natural resources, especially land and water. On the other hand, natural resources need to be managed carefully in order to ensure their sustainability. Constraints on urban land results in the urbanization of fertile agricultural land along the city's edge. Over use of water resources, 118 especially in urban areas, has reached such extreme levels that the supply of water and much of the catchment areas have been degraded. Waste, water and land pollution are major negative by- products of development which threaten the sustainability of development. In rural areas, the limited education of both communities and the local government personnel who guide development activities have contributed to the destruction of the forest and conservation areas. The destruction of local environments has a direct effect on local communities. Environmental degradation by private sector concerns who seek profits from mining, manufacturing, and fishing is a crucial planning issue in and of itself. Finally, the various economic imbalances between regions and cities, between villages and cities, and within the community groups in the city, are all significant planning issues which would benefit from a rural-urban approach. It is also clear that the discrepancy in supplies of natural resources and human resources in terms of both quality and quantity, is causing inequality in productivity among regions and thereby promoting uneven urbanization. Conclusion The impacts of Indonesia's rural and urban development policies, especially the social and economic effects of rice intensification and transmigration programs have been substantial in North Sulawesi. Rice intensification through the B I M A S program is generally well accepted in village communities that have adequate water for rice fields, even i f they are entirely dependent on rainfall. A l l of the communities included in the present study enjoy a regular irrigation system, and therefore meet this prerequisite for participation in the B I M A S program. Yet the program has been successful not only in transmigration villages such as Mopugad Selatan and Mopuya Selatan, but also in nontransmigration villages such as Doloduo and Dondomon. However, the B I M A S program is only beneficial to the farmers who possess wet rice fields and a majority of 119 these farmers are identified as transmigrants. Thus, the rice production policies, which were designed by the central government in Jakarta, have fewer benefits for the local people. Local people primarily own dry fields and plant traditional crops such as corn, cassava, sweet potato, and other vegetables. Transmigration programs have generated a substantial impetus for regional development. Resettlement makes an obvious contribution to reducing the shortage of labor and utilizing natural resources. More than half of the total production of rice in North Sulawesi comes from transmigration areas. The increased government expenditure resulting from the budget allocations for transmigration has become very important for development. A part of the road network, (especially in the two districts of Bolaang Mongondow and Gorontalo) has been financed out of the transmigration budget. Many public and private investments in the region can only be justified economically by the outcome of the changes brought by transmigration. Resettlement programs make a distinct contribution to rising income levels, both for local inhabitants and for migrants. Therefore purchasing power in the region has increased. The effects upon economic development in the province and district have not yet been properly incorporated into overall regional policy. Thus optimum use cannot be made of the driving force they provide. Despite transmigration's significant influence upon the region, there is a lack of coordination sensitive to the development potential and bottlenecks in the region. Coordination needs to be sensitive as well to special ethnic factors which influence the intake region's social absorptive capacities. For the most part, intersectoral coordination is still centrally managed, although a change of course was made in this respect by Government Regulation No.6 in 1988. Urban development during the Long Term Development Plan I from 1969/1970 to 1993/94 clearly showed an emphasis on development of urban infrastructure and services in 120 metropolitan areas and other big cities. Relatively less attention has been given to improving urban management and municipal development, especially in medium cities and small towns. These urban centers are quite often visited by people from rural areas for services such as education and medical help. There are a number of relevant issues in this respect, including: improving local government capability to increase local revenues, controlling physical urban development, managing and supplying urban infrastructure, land management, creating an environment for improving direct participation of private sector and communities in urban development, issuing regulations that support urban development, and increasing the skill of the local government apparatus in urban development. Increasing the level of education of communities and improving their socio-economic conditions w i l l result in greater demand for quality service from local governments. A s they become more knowledgeable, urban communities w i l l be more critical and skeptical regarding the problems of urban development. Therefore, there must be a transition from a style of urban management that was relatively closed to the public, to a new type o f implementation which is more transparent to urban communities. In Indonesia, rural development policy (especially in the case study area of North Sulawesi) is focused on the goal of rice self-sufficiency. This policy is strongly supported by the transmigration program. However, the policy does not address the issue of rural-urban linkages in a way which can reduce the gap between rural and urban areas. Thus, a comparison between migrants and nonmigrants is helpful for understanding the overall picture of rural-urban interaction. In the context of North Sulawesi, especially in the case study area, transmigration is important because of its significant impacts on both migrants and nonmigrants populations. Because migrants and nonmigrants have different characteristics, they also link differently to the urban hierarchy. These differences are described in detail in the following two chapters. 121 CHAPTER FOUR CHARACTERISTICS OF NONMIGRANTS AND MIGRANTS IN THE CASE STUDY AREAS Introduction Rural development policies have clearly benefitted transmigrants more than their local neighbors. The findings show that the migrants enjoy significantly higher incomes and own more wet rice land and production tools than their local counterparts. The success of migrants is not only derived from their skills and motivation to improve their lives, but is also supported by the central government which provides land and infrastructures such as dams, irrigation networks, and rural roads. Rural development policies are always designed in urban areas, in Jakarta by the central government or in provincial and district capitals. They are then implemented in rural areas under the supervision of officials from provincial and district governments. Policy aims are usually to improve rural economic conditions. Rural communities can benefit when these policies are applicable to rural community conditions. However, this is often not the case, because these policies usually ignore the cultural differences between communities in rural areas. One clear example is the introduction of the Green Revolution for improving rice production. The strategy for increasing rice production was first introduced through the B I M A S program. This program assumed that rural communities w i l l easily accept new technologies such as new seeds, fertilizers, pesticides, and new practices, such as the use of hand tractors in wet rice fields. However, the introduction of new technologies cannot be evenly accepted by rural communities because of their different cultural backgrounds. 122 The local people, especially the Mongodownese in this study, have practiced dry field planting of crops such as corn, sweet potato, cassava, and vegetables for countless generations. They have become quite advanced in managing dry fields with these traditional crops. However, the economic value of these crops is low compared with rice. Since the local people are less familiar with working in wet rice fields, they do not benefit as much from wet rice technology as the migrants. The transmigrants, both Javanese and Balinese, are highly skilled in managing wet rice fields. They have for many generations grow wet field rice as their dietary staple and have learned to optimize production on the small fields 1 which they have in Java and Bal i . The skills and knowledge of managing wet fields, which were transferred from their ancestors, have become the main capital for starting a new life in the fertile land of the Dumoga Valley, where two hectares of land were provided for each family by the government. Differences in cultural background between the local people and transmigrants have significant implications for the adoption of new agricultural technologies and the improvement of socio-economic conditions. The impacts and consequences of rural development policies on rural communities, are the main concern of this chapter. There is very little information about the differential characteristics of migrants compared with the local population, i.e., those born in Bolaang Mongondow, and North Sulawesi. The following section w i l l investigate how migrant and nonmigrant populations differ in terms of demographics, occupation, economic situation, and ownership. The second section analyzes the motivations and the comparative advantages of migrants, and notes their main contributions to 1 Many migrants have wet rice fields which are smaller than a half hectare. Most of them have previously no land and have had worked as laborers in wet rice fields. 123 the region. The third section analyzes the main effects of rural development on family and community and identifies the main problems. The final section is the chapter's conclusion. Demographic Differentials Age and Sex Differentials The age distribution and sex of household heads in nonmigrant and migrant households are indicated in Table 4.1. In general, the data show that the nonmigrants are relatively younger than their counterpart migrants. The nonmigrants are concentrated in the 20-39 year age group while migrants are more concentrated in the 30-49 year age group and the group aged 60 years and older. The proportion of migrants aged 60 or older is almost four times higher than the proportion of nonmigrants in the same age group. The proportion of nonmigrants in the 20-29 years age group is almost two times higher than the proportion of migrants in the same age group 2. Regarding the sex of nonmigrants and migrants, the data reveal that male nonmigrants are generally concentrated in the 20-29 and 30-39 age groups. Male migrants are predominantly in the middle and old age groups (namely, 30-39, 40-49, and 60 years and above). Both female nonmigrants and migrants are predominantly found in the young and middle age groups (20-29 and 30-39 years). In the oldest age group (60 years and older) there are high proportions of both male and female migrants, compared to their nonmigrant counterparts. This is probably due to the fact that many of the oldest migrants are still active in production activities, such as acting as bread-winner to support household incomes. 2 In comparison, data taken from Central Sulawesi reveal that the ages of both nonmigrants and migrants there are equally concentrated in the 20-39 years age group. In Central Sulawesi, the proportion of nonmigrants in the 50 year and older group is relatively higher than the proportion of migrants in the same age group. 124 Table 4.1 Age and Sex of Household Head of Nonmigrants and Migrants Age Nonmigrants (%) Migrants (%) Group Male Female M+F Male Female M+F 2 0 - 2 9 27.1 37.9 32.1 15.3 20.5 17.1 3 0 - 3 9 31.4 43.1 36.7 22.2 35.9 27.0 4 0 - 4 9 17.1 3.4 10.9 26.4 15.4 22.5 5 0 - 5 9 15.7 13.8 14.8 12.5 12.8 12.6 60+ 8.7 1.8 5.5 23.6 15.4 20.8 Total (%) 100 100 100 100 100 100 Total (N) 70 58 128 72 39 111 Note: M+F = Male and Female Source : Sample Survey Data Education Differentials In general, as the data indicate in Table 4.2, the education levels of migrants are relatively higher than their counterpart nonmigrants, both for males and females. Almost 70 percent of nonmigrants (both males and females), had at most completed primary school. Only 10.2 percent of nonmigrants (both males and females) had finished secondary school. In contrast, most migrants had studied at the junior high school level. Some of them had even completed senior high school and college. About 16.3 percent of the migrants had taken vocational training. The higher educational status of migrants may be explained by their selection prior to arrival in North Sulawesi. This finding supports some prior studies which also indicated that migrants tend to have higher education levels than local nonmigrants (Titus, 1978; Hugo, 1981) The data show that male migrants generally have a higher level o f education than female migrants. For example, at the junior high school level the proportion of males was double that for females. This may be partly due to the fact that males are given priority over females in schooling opportunities, because males w i l l usually become the bread-winner in the household. However, in terms of those educated at the level of senior high school and vocational training, the proportion of females is relatively larger than males. For nonmigrants, it appears that the 125 proportion of those who had completed primary school and secondary school was higher for females than for males. Thus, it can be said that for the nonmigrant population, both males and females have a relatively equal opportunity to study at least at primary school. Although the levels of education are higher among migrants than among nonmigrants, in general both groups have a low level of education (around 68.7 percent of nonmigrants and 28.8 percent of migrants had primary levels of education and below) 3 . Table 4.2 Education and Sex of Nonmigrants and Migrants Education Nonmigrants (%) Migrants (%) Male Female M+F Male Female M+F Not completed primary school 27.1 20.7 24.2 1.4 - 0.9 Completed primary school 38.6 51.7 44.5 20.8 41.0 27.9 Not completed junior high school 8.6 3.4 6.3 41.7 20.5 34.2 Completed junior high school 15.7 10.3 13.3 11.1 5.1 9.0 Not completed senior high school 1.4 1.7 1.6 1.4 - 0.9 Completed senior high school 8.6 12.1 10.2 8.3 12.8 9.9 College/University - - - 1.4 - 0.9 Others* - - - 13.9 20.6 16.3 Total (%) 100 100 100 100 100 100 Total (N) 70 58 128 72 39 111 Note : * including vocational training M+F = Male and Female Source: Sample Survey Data 3 Data from Central Sulawesi show that the majority of both nonmigrants and migrants are educated at the primary school level, and only 25 percent of nonmigrants have completed secondary school. 126 Marital Status and Number of Children Data on marital status reveal that the majority of both nonmigrants and migrants are married, with the proportion married being 96.9 percent of nonmigrants and 91.8 percent of migrants. The proportion of divorced and widowed is relatively higher among migrants than among nonmigrants 4. Both nonmigrants and migrants tend to have big families. The proportion of nonmigrants and migrants who have 3 or 4 children is 34.4 percent and 32.4 percent respectively. The proportion of both non-migrants and migrants having 5 children or more is around 21.9 percent and 22.5 percent respectively 5. Occupational Differentials Main Occupations of Household Labor Force The main occupation of household head for both nonmigrants and migrants is indicated in Table 4.3. The data show that most (80.2 percent) migrant heads of households are farmers (own land). The proportion of nonmigrants classified as farmer is around 47.7 percent6. The proportion of migrants classified as laborer and farm laborer is only 4.5 percent, while the proportion for nonmigrants in these occupations is almost 40 percent. The relatively higher proportion of nonmigrants who work as laborers and farm laborers is related to the fact that they do not own their own wet rice field or dry crop fields. The data also show that 12.4 percent of nonmigrants and 15.3 percent of migrants are classified as trader, carpenter, public servant and other (such as retired). People classified in these 4 The data from Central Sulawesi indicate that the majority of both nonmigrants and migrants there are married. 5 These patterns resemble the data from Central Sulawesi, where 37.5 percent of nonmigrants and 48.5 percent of migrants have 3 or 4 children, and 25 percent of nonmigrants and 24.2 percent of migrants have 5 or more children. 6 These findings are similar to the data from Central Sulawesi where the proportion of nonmigrants and migrants classified as farmers was around 68.8 percent and 72.7 percent respectively. Only 6.3 percent of nonmigrants and 9.1 percent of migrants were classified as laborer and farm laborer. 127 occupations may also be farmers who work part-time in either paddy or crop fields. The proportion of public servants is relatively small for both nonmigrants and migrants, but those public servants may be working at the subdistrict level in low positions, and some of them are working as primary school teachers in the villages. Since their salaries are relatively small, the public servants also need to work extra jobs to get more money to support their families' needs. Table 4.3 M a i n Occupation of Household Head and Housewife of Nonmigrants and Migrants (percentage) Ma in Occupation Household l|iead Housewife Non-migrants Migrants Non-migrants Migrants Laborer 10.2 - 41.4 32.4 Farm Laborer 29.7 4.5 2.3 4.5 Farmer (Own Land) 47.7 80.2 - - Trader 2.1 3.6 0.8 0.9 Carpenter 2.9 0.9 - - Public servant 2.9 3.6 - - Other 4.5 7.2 - - N o job - - 55.5 62.2 Total (%) 100 100 100 100 Total (N) 128 111 124 103 Source : Sample Survey Data Females, and especially housewives living in rural areas, tend to experience "double duty", as preparing meals and doing daily household tasks for the whole family, while also working outside the household, either in their own fields or as a laborer in other people's fields. A s Table 4.3 indicates, 41.4 percent of nonmigrant housewives and 32.4 percent of migrant housewives work outside their household, mainly as laborers and farm laborers7. This is explained by the fact that they work outside the household in order to earn cash to support the household's basic daily needs. 7 These trends are similar to Central Sulawesi where the proportions of nonmigrant and migrant housewives whose main occupation is outside the household are around 31.3 percent and 51.5 percent respectively. 128 It is common in rural areas for youth to work, either helping their parents in wet rice or crop fields or working outside their home to contribute to the family's coffers. The proportion of nonmigrants and migrants who have working youth or teenagers in the family is 30.4 percent and 36.0 percent respectively, the majority of whom are working as laborers and farm laborers with only a small proportion working outside agricultural activities as traders8. In many cases the youth are working part-time after school. Those who no longer go to school tend to work full-time, either helping their parents or working outside the family. It is common that these family workers work with their parents during the busy times in preparing for planting and harvesting and after those seasons work as laborers in others people's wet rice or crops fields. They use the salaries they earn from working for other people to buy their clothing, shoes, and cigarettes or to travel to small towns for sightseeing. It is shown above that in order to sustain their lives, farmers in rural areas optimize all the labor force available in the family as a strategy for meeting the whole family's basic needs. The family labor force strategy not only involves the parents and teenagers, but in many cases the younger children also participate in the whole family process of production, whether at home or in the fields. The village reality is that after school, the girls help their mothers to look after younger brothers or sisters, or help to prepare lunch or dinner for the whole family, or help with other chores such as cleaning the vegetables, washing household utensils, gathering, carrying and cutting fire woods, and carrying water. Common activities for the boys are taking lunch for their parents in the fields, shepherding livestock such as cows, water buffaloes, or horses, or helping in the fields. 8 The data from Central Sulawesi show that the proportions of working youth in nonmigrant and migrant families are around 18.8 percent and 48.5 percent respectively. 129 Part-time Occupations and Off-farm Jobs In order to make a living in rural areas, some farmers have to work outside their main occupation or work in off-farm jobs as Table 4.4 reveals. The data show that for both nonmigrants and migrants the proportion of household heads who have a part-time job is around 48.5 percent and 35.1 percent respectively. The nonmigrant household heads are more likely to have a part-time job than the migrant household heads. Most part-time jobs are related to agricultural activities, usually activities to prepare land for planting paddy, such as land clearing, plowing, smoothing the soil and managing the water supply from the irrigation system. A l l these activities are ongoing, under rain or the heat of the sun. The agricultural worker or laborer does not have a choice despite poor weather. In many cases a day's work, which earns from Rp 4,000 to Rp 5,000 per day, starts at 6 a.m., with a break from 11 a.m. to 2 p.m., and ends at 5 or 6 p.m. Table 4.4 Part-time Occupation of Household Head and Housewife for Both Nonmigrants and Migrants (percentage) Part-time Occupation Household head Housewife Nonmigrants Migrants Nonmigrants Migrants Agricultural Laborer 14.1 9.0 26.6 24.3 Laborer 8.6 3.6 8.6 10.8 Trader 6.3 9.0 - - Carpenter 4.7 3.6 - - Other 14.8 9.9 - - N o part-time job 51.5 64.9 64.8 64.9 Total (%) 100 100 100 100 Source : Sample Survey Data Other activities are related to paddy harvesting. The sequence of activities is cutting paddy, gathering, dropping off paddy, clearing and filling gunny or plastic sacks, and taking all paddy to a spot next to a road accessible to small trucks. Laborers are mostly paid in paddy rather than money, usually 10 percent of the total yield. However, this 10 percent is divided according to the number of people involved in the paddy harvesting activities. 130 Some nonmigrant and migrant household heads work part time as traders, either in their own house or in the village markets. Some run small businesses in their houses, for example, opening a small shop (waning) selling things such as groceries, cookies, candies, cigarettes, soap, and some items for daily needs. Some sell agricultural products, such as vegetables and fruits, at the village markets. Some of those agricultural products are produced by themselves and some purchased from other peasants in the village. Some household heads work part-time as middle men who buy chickens, goats and pigs in the village which they market either at the village market or at markets in other villages. Both migrants and nonmigrants also find part-time work as carpenters and construction workers, in either their own village or in other villages where they build or repair houses, or work on other construction. Quite often these people are involved in construction of government projects in the villages, such as school buildings, community health centers, and other local government buildings. In general, these types of part-time jobs outside of agriculture are undertaken when the heads of households are not too busy working at their own fields. There is a slow period, usually after planting and weeding and before harvesting, an interval of less than 2 months, when the farmers must regulate the water flowing to their paddy field to ensure an adequate amount. A few weeks before harvest, there is also work to scare off the birds which would otherwise eat the paddy early in the morning (5 a.m. to 7 a.m.) and in the afternoon (3 p.m. to 6 p.m.) The data also indicate that 35.2 percent of nonmigrants housewives and 35.1 percent of migrant housewives hold a part time job 9 . In general, they work as agricultural laborers and 9 In Central Sulawesi, the proportion of nonmigrant housewives working part-time is around 25 percent, which is higher than the proportion of migrant housewives with part-time j obs (only 15.1 percent). 131 laborers. Female work in the paddy field usually deals with planting, weeding, harvesting and dropping off paddy. Migrant Workers It is a fact of life for both nonmigrant and migrant household heads that when they work either in their main occupation or at part-time jobs, they often have to work outside their own village, in other nearby villages, rural centers or small towns. That proportion both for nonmigrants and migrants is 60.9 percent and 60.4 percent respectively. There are various reasons why migrant workers have to spend a few days in their place of work or leave their village for a few days. One reason is related to the job itself, for example, that the job could be done and finished in a few days such as paddy harvesting and dropping off. A second reason is related to the location of work, and how much time is spent traveling and whether public transit is available. If the travel time is long or i f transit is limited, workers may have to spend a few days away from their villages. Some workers commute, leaving their villages early in the morning and returning in the late afternoon. Around 29.7 percent of nonmigrants and 37.8 percent of migrants commute like this, due to the work places being accessible by public transit or bike and relatively close to their own villages. Improved job opportunities available in the region have created migration patterns for the village workers, namely rural to rural migration rather than rural to urban migration. It is understandable that these migration patterns occur as a consequence of new job opportunities being created in certain villages throughout the region. 132 Job Creation and Hired Workers Increasing the agricul tural activit ies i n the region results not on ly i n new jobs i n the agricultural sector, but also i n i m p r o v i n g activit ies i n non-agricul tural sectors. A s a consequence these activit ies are creating new jobs outside o f agricultural activit ies, as indicated i n Figure 4.1. The creation o f new jobs outside agriculture such as rural smal l industries, can offer alternative employment options for rural people, especial ly dur ing the s l o w season w h e n farmers do not have m u c h f ie ld work . The rural smal l industries are most ly food processing activit ies such as p roduc ing cassava crackers, m a k i n g tradit ional cakes and fried peanuts for snacks, p roducing tofu and soybean cake, and produc ing tradit ional ice cream. Service activit ies also create some n e w jobs i n rural areas. A s more people i n the vi l lages use b icyc les as a m a i n mode o f transportation there are new jobs for v i l l age people w h o open b icyc le repair shops. There are also workshops for repair ing agricul tural product ion tools such as p lows , sma l l tractors, and wheels . R u r a l females open hair salons to serve both m e n and w o m e n i n the vi l lages . The majori ty o f respondents, both nonmigrants and migrants, stated that under current condit ions plenty o f opportunities c o u l d s t i l l be found (both i n the v i l lages and outside the vi l lages) to w o r k as agricultural laborers or laborers for any k i n d o f manual j ob . Thus , the j o b opportunities avai lable both i n the vi l lages and outside the vi l lages have kept the rural to urban f lows o f migrant workers relat ively smal l . A l t h o u g h they do not have problems f inding jobs i n the vi l lages , some nonmigrants and migrants are more concerned that the land that c o u l d potential ly be planted as paddy and crop fields is l imi ted . They also ment ion that the potential for their ch i ld ren to f ind jobs i n the cities after f in ish ing secondary school or universi ty w i l l not be easy, especial ly for those who want to become publ ic servants. Some famil ies compla ined that they had already spent too m u c h money to smooth the way for their ch i ld ren to w o r k i n loca l 133 government institutions, including money for bribes to certain key bureaucrats, although in the end their children were not accepted. Thus, they said, it is easier to become farmers because they do not have to spent too much money and certain skills learned from school or university are not needed to be a peasant. A real farmer needs only to learn by working directly in the field. Figure 4.1 Allocation of Household Workers in Four North Sulawesi Case Study Villages, Based on Sector and Type of Workers Household Workers Agricultural Sector Nonagricultural Sector Working in village ~* Commuter workers Migrant workers Working in village -+ Commuter workers "* Migrant workers The data in Table 4.5 also indicate that some nonmigrants and migrants have to hire laborers to work their properties. It is quite common that they hire from 1 to 4 workers for working either in wet rice fields or crop fields. During the planting seasons and harvesting seasons, they usually hire from 10 to 20 workers. These employers are mostly landlords who dominate land ownership and a significant part of economic life in the villages, by means of 134 offering credit with relatively high interest to the village peasants, and controlling the village paddy mills. Table 4.5 Family Labor Utilization and Hired Labor for Nonmigrants and Migrants Type of Worker Nonmigrants (%) Migrants (%) Number of Hired Workers 0 1 2 3 4 0 1 2 3 4 Household workers: Work in the village Commuter worker Migrant worker Hired workers: Agricultural worker Nonagricultural Worker 68.8 24.3 6.3 - 1.6 96.9 2.3 0.8 46.9 8.6 18.0 7.8 17.2 94.5 2.3 2.3 0.8 25.8 43.0 18.0 10.2 74.8 13.5 7.2 3.6 93.7 5.4 0.9 29.7 8.1 13.5 13.5 35.2 97.3 - 0.9 - 1.8 15.3 29.7 27.0 11.7 15.3 Source: Sample Survey Data Economic Differentials Income Sources Although people l iving in rural areas work predominantly in agricultural activities, it can not be assumed that their main sources of income come from the agricultural sector. In fact, the farmer households in the case study villages depend also on income from nonagricultural sectors activities such as work in the services and trade sectors, rural industries, rural mining, urban jobs (services and small industries), and transfers, as shown in Figure 4.2. 135 Figure 4.2 R u r a l H o u s e h o l d Income Sources i n Case Study Areas o f F o u r V i l l a g e s i n N o r t h Su lawes i , Indonesia Rural - Income Agriculture "Nonagriculture "* Crops Food crops Special crops Tree crops -> Small industry — Agrobased Urban-based Employment in rural services and trade -* Employment in rural Mining Urban Services Transfers (e.g., rents, interests, and remittances) Table 4.6 shows the nonmigrants ' and migrants ' income sources and average household income based o n sectors and places. In general, the average income o f migrant households is higher than nonmigrant households. The data indicate that the average income der ived from the agriculture sector is relat ively h igh , compared w i t h the average income gained f rom the nonagricul tural sector, for both migrants and nonmigrants. The average income f rom agriculture for migrants is R p 356,189 per month , more than two times higher than the average agricultural 136 income for nonmigrants, which is only Rp 151,740 per month 1 0 . The relatively high average income of migrants is related to the concentration of migrants in two income groups at the income level of Rp 200,000 or less, and at Rp 201,000 to Rp 499,000. The proportion of migrants in the first category (income level Rp 200,000 or less) is only 40.5 percent while for nonmigrants more than 67 percent fall into that range. For those at the income level of Rp 201,000 to Rp 499,000, the proportion of migrants is larger than the proportion of nonmigrants, 39.6 percent and 17.2 percent respectively. The data also show that almost 12 percent of nonmigrants do not gain any income from agricultural activities; the figure for migrants is less that 2 percent. In other words, much of the income of migrants in the North and Central Sulawesi study villages comes from agricultural activities, perhaps because the proportions of wet rice field ownership for migrants is also relatively high. The issues of land ownership w i l l be discussed in detail later in this chapter. Another explanation may be that in terms of household labor utilization, migrants optimize their household labor resources better to support the family income. The relatively low average income of nonmigrants earned from the agricultural sector is due to the fact that they tend to engage in agricultural production of crops that have relatively low terms of trade such as cassava, sweet potato, and corn. A s discussed in Chapter Three such commodities used to be the main staples of the nonmigrants' diet and may still be for some nonmigrants. Another interesting issue indicated in Table 4.6 is the average income sources based on non-agricultural sectors, which are higher for nonmigrants than for migrants 1 1 (per month, 1 0 The income data from Central Sulawesi indicate that the average income from the agricultural sector is high compared with the average income from nonagricultural sectors, for both nonmigrants and migrants. The average agricultural income for migrants is almost three times higher than the average agricultural income of nonmigrants. 1 1 These patterns support findings from Central Sulawesi, where the average income based on nonagricultural sector is Rp 189,813 per month for nonmigrants and Rp 111,254 per month for migrants. 137 around Rp 117,395 for nonmigrants and Rp 87,365 for migrants). This is due to the fact that some nonmigrants are forced to find jobs outside of agriculture because of the shortage of land in the villages. Many of them work in village industries, services, construction, and rural mining. Therefore, around 43 percent of the nonmigrants' income comes from nonagricultural activities. Table 4.6 Sources of Household Income by Sector and Location (According to Percentage of Households) Amount of Income from Source Nonmigrants (%) Migrants (%) Sector Location Sector Location (Rupiah/month) A N A F V FOV A N A F V FOV 0 11.7 34.4 10.9 54.7 1.8 55.0 8.2 71.2 < 200,000 67.2 47.7 61.7 31.3 40.5 33.3 37.8 9.9 201,000-499,000 17.2 13.3 20.3 9.4 39.6 6.3 36.9 13.5 500,000 - 999,000 2.3 4.6 5.5 4.6 14.4 4.5 11.7 4.5 1,000,000- 1,999,000 1.6 - 1.6 - 2.8 0.9 2.7 0.9 > 2,000,000 - - - - 0.9 - 2.7 - Average (Rupiah) 151,740 117,395 172,443 95,757 356,189 87,365 405,768 95,493 Note: A = Agriculture, N A = Nonagriculture, F V = From Village, F O V = From Outside Village Source: Sample Survey Data The comparison of income sources based on location of work in Table 4.6 indicates that the average income for both nonmigrants and migrants is mainly gained from their own villages, rather than from outside the villages. The average income of migrants earned from within the village is around Rp 405,768 per month, while for nonmigrants it is only Rp 172,443 per month. The average income gained from outside the village for both nonmigrants and migrants is relatively similar, Rp 95,757 per month and Rp 95,493 per month respectively . In general, even though the income sources of both nonmigrants and migrants are derived from different sectors 1 2 The data from Central Sulawesi indicate a similar pattern where, for both migrants and nonmigrants, the average income gained from their villages is high compared with the average income earned outside their villages. In Central Sulawesi, the average income of migrants gained from within the villages is around Rp 867,166 per month, and for nonmigrants only Rp 499,491 per month. The average income from outside villages for both migrants and nonmigrants is Rp 100,235 per month and Rp 18,125 per month respectively. 138 and places, most of their income is still gained mainly from the agricultural sector and from within their own villages. The farmers' incomes from agriculture are based on major commodities such as rice, cash crops, tree crops, and husbandry, as indicated in Table 4.7. Rice earnings contributed the biggest part of income for both nonmigrants and migrants. The migrant's average income gained from rice is around Rp 347,473 per month, which is three times higher than the nonmigrant's average 1 3 income (only Rp 111,315 per month) . For nonmigrants, cash crop sales contribute the second largest portion of total income, and noncrops and husbandry contribute relatively small amounts to the total income. Husbandry contributes the second largest portion of migrants' average income and cash crops and non-crops provide relatively small portions of the total income. Table 4.7 Source of Household Income by Major Commodities (According to Percentage of Households) Amount of Income from Source Non-migrants (%) Migrants (%) (Rupiah/month) R CC TC H R C C TC H 0 53.3 59.4 83.6 96.9 6.3 88.3 87.4 82.0 < 200,000 32.0 36.7 15.6 3.1 35.1 10.8 11.7 14.4 201,000-499,000 12.4 2.3 0.8 - 42.3 0.9 0.9 2.7 500,000 - 999,000 1.6 1.6 - - 11.7 - - - 1,000,000- 1,999,000 0.8 - - - 4.6 - - 0.9 > 2,000,000 0.8 - - - - - - - Average (Rupiah) 111,305 38,874 11,770 1,295 347,473 8,166 4,956 26,622 Note : R = Rice, C C = Cash Crop (e.g., beans, vegetables, and fruits), T C = Tree crop (e.g., coconuts, cloves, and cocoas), H = Husbandry (e.g., chickens, ducks, goats, and pigs) Source: Sample Survey Data 1 3 Central Sulawesi data indicate that rice was also the top earner of total income for both nonmigrants and migrants. The average income gained from rice for migrants is around Rp 584,047 per month and three times more than the portion which rice earnings contribute to average income of nonmigrants (Rp 169,575 per month). The second biggest contributors to total income are husbandry for nonmigrants and tree crops for migrants. 139 The farmers' income received from nonagricultural sectors is divided into four major classifications. First are industries based on rural small-scale industry and agroindustry. Second are services including trade, and mining. Third are urban jobs, and fourth, transfers including rents and remittances. Table 4.8 indicates that the services sector contributes the biggest part of total nonagricultural income for both nonmigrants and migrants 1 4. Nonmigrants' average income gained from services activities is about Rp 129,059 per month, and for migrants around Rp 92,898 per month. The contributions of rural industry, urban jobs, and transfers for both nonmigrants and migrants has a relatively small influence on their total income. Table 4.8 Source of Household Income by Nonagricultural Activities (According to Percentage of Households) Amount of Income from Source (Rupiah/month) Non-migrants (%) Migrants (%) I S UJ T I S UJ T 0 95.3 39.8 98.4 95.3 91.0 61.3 99.1 99.1 < 200,000 4.7 39.8 1.6 4.7 8.1 27.9 0.9 0.9 201,000-499,000 - 12.5 - - - 5.4 - - 500,000 - 999,000 - 6.3 - - - 3.6 - - 1,000,000- 1,999,000 - 1.6 - - - 1.8 - - > 2,000,000 - - - - - - - - Average (Rupiah) 3,720 129,059 762 1,666 7,772 92,898 838 135 Note : I = Industry (e.g., agroindustry, small-scale industry) S = Services (e.g., services, trade, and mining) U J = Urban Jobs T = Transfers (e.g., rents, remittances, and interest) Source: Sample Survey Data 1 4 Data from Central Sulawesi show that the services sector contributes the biggest part of total income for both nonmigrants and migrants. The average income gained from the services sector by nonmigrants is about Rp 162,500, and for migrants is about Rp 94,545 per month. Contributions of rural industry, urban jobs, and transfers are relatively small for both nonmigrants and migrants in Central Sulawesi. 140 Consumption and Expenditure Patterns The proportion of household expenditures and average costs for daily needs for both nonmigrants and migrants are indicated in Table 4.9. The average costs for daily needs of nonmigrant households are h igh 1 5 (Rp 4,729 per day) compared with that of migrants (Rp 4,016 per day). The majority of both nonmigrants and migrants spent between Rp 2,500 and Rp 5,000 per day for daily needs. Only a small proportion of nonmigrants and migrants spent more than Rp 5,000 per day for daily needs. Table 4.9 The Proportion of Household Expenditures and Average Costs for Daily Needs for Nonmigrants and Migrants Expenditure on Daily Needs (Rupiah/day) Nonmigrants (%) Migrants (%) 0 < 2,500 22.7 38.7 2,501 - 5,000 57.7 46.8 5,001 - 7,500 11.7 5.5 7,501 - 10,000 6.3 6.3 10,001 - 14,999 - - > 15,000 1.6 2.7 Total (%) Total (N) Average (Rupiah) 100.0 128 4,729 100.0 111 4,016 Source : Sample Survey Data Although the average cost of daily needs for nonmigrants and migrants doesn't differ greatly, it is quite interesting to investigate why they differ. The majority of migrant households report that they do not have to buy many groceries in the public markets because they produce rice, vegetables, fruits and other essentials themselves. However, only a few nonmigrant households produce vegetables, beans, maize and sweet potatoes for their own consumption. The 1 5 The situation appears similar for Central Sulawesi, where the average costs used for daily needs by nonmigrants is around Rp 5,656 per day, higher than the average costs spent by migrants, which is only Rp 4,651 per day. 141 majority of nonmigrant households buy most of the groceries they need at public markets or small shops (warung). Therefore migrants spend more on non-essential items. The desire to maximize the productive output of the available land surrounding the house is more common among migrants rather than nonmigrants, especially for migrants from Bal i . The land surrounding their houses is planted with products for the family's consumption, such as many kinds of vegetables and fruits, and also coconuts, cloves, and coffee. Because they can produce food for themselves, the money not spent on groceries can be saved, either by themselves at home or by joining an arisan, the rotating savings scheme common in the villages. The patterns of spending on education, health, clothing, utensils and furniture, etc. for migrant and nonmigrant households are shown in Table 4.10. The data clearly indicate that the average annual expenditures of migrant households for education, health, clothing, and "other" is h igh 1 6 compared with the average annual expenditures of nonmigrant households for similar items. "Utensils and furniture" is the only category where the average expenditures of nonmigrants exceed the average expenditures for migrants. Besides the expenditure classified as "other", the average expenditure for education is the highest for both migrants and nonmigrants. The second biggest expenditure is that for clothing. The expenditure for health was the lowest of all kinds of expenditures for both nonmigrants and migrants. The average expenditures for "other" is high compared with other categories of expenditures for both nonmigrants and migrants. The "other" category covers taxes, arisan or savings, charities, and donations for village development and activities. The relatively high expenditure for "other" indicates that both nonmigrants and migrants directly participate in rural 1 6 These findings echo data from Central Sulawesi where the average expenditures of migrants for education, health, clothing, utensils and furniture, and others per year are higher than the average annual expenditures of nonmigrants for similar items. 142 development as they pay taxes and donate money for rural community development activities. Migrants' expenditures on "other" are higher than those of nonmigrants because of their religious activities, especially for Balinese who hold frequent individual and/or communal ceremonies. Each religious activity or event requires money for buying offerings. According to one informal leader in the village, the cost of things to prepare one simple offering is around Rp 5,000. Table 4.10 The Proportion of Household Expenditure and Average Annual Costs for Education, Health, Clothing, Utensils and Furniture, and Other, for Non-migrants and Migrants Amount of Expenditure Nonmigrants (%) Migrants (%) (Rupiah) E H C UF O E H C UF O 0 44.5 5.5 1.6 12.5 4.7 38.7 3.6 1.8 9.9 1.8 < 100,000 7.8 85.1 47.7 67.2 28.9 7.2 83.8 46.8 77.5 5.4 101,000-250,000 18.0 7.8 32.8 10.2 19.5 21.6 9.9 32.4 9.9 27.0 251,000- 500,000 14.1 1.6 16.3 8.6 27.3 24.3 2.7 15.3 2.7 35.1 501,000- 1,000,000 10.9 - 1.6 1.6 14.1 1.8 - 3.6 - 18.9 > 1,000,000 4.7 - - - 5.5 6.3 - - - 11.7 Total (%) 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Total (N) 128 128 128 128 128 111 111 111 111 111 Average (Rupiah) 241,756 46,873 163,555 90,829 157,971 250,139 49,885 173,829 60,013 282,420 Note: E = Education, H = Health, C = Clothing, U F = Utensils and Furniture, O = Other (e.g., Taxes, arisan, charities, funds for village development and activities, and other) Source: Sample Survey Data Raising Cash and Access to Informal Credit Institutions Many families do not have enough money to cover the household needs discussed above. Therefore, it is not surprising that there are some respondents, around 21.9 percent of nonmigrants and 18 percent of migrants, who reported that they had to sell some of their belongings such as land, houses, and production tools, in order to raise cash that they needed. Both nonmigrants and migrants shared similar reasons for parting with their belongings. First, they need money to pay for their daily expenses. Some also mentioned that both their paddy and cash crops harvests had failed due to flooding. Second, they need money to support their 143 children who are studying in the cities, and for paying the costs of hospital or health facilities and medicines. Third, they sold their land because its location was too far from home and/or they did not have enough household labor to work in the paddy fields. Some had to sell their land to the local government because an irrigation network project passed directly through their land. Fourth, they sold the land in order to buy another piece of land located closer to their village. Others sold land to raise money to add to or build a house. Finally, some sold their land or house to raise capital for starting a business. The reasons given above show that some respondents sell their properties not only for consumption reasons but as a transfer of investment. For example, some respondents have decided to sell their land to finance building or improving their houses, or to establish a small business in the village, such as trading cows and goats, or running a small shop. Nonmigrants and migrants differed in their choices of buyers for their properties. Nonmigrants sold their properties to the people in the same village and/or to people outside the village, mostly other migrants. Migrants sold to people in the same village, to people outside the village (either migrants or nonmigrants), and to people in towns or cities. Other sources of cash to fulfill the households' basic needs are the informal institutions of credit within or outside of the village. A s Table 4.11 indicates, more than 50 percent of both 1 7 nonmigrants and migrants borrowed money from their relatives . More than 7.1 percent of nonmigrants have links to money lenders in their own or other villages, while only 2.7 percent of migrants accessed these sources of credit. Those with credit links to the village landlords constituted only 5.4 percent of nonmigrants and 7.2 percent of migrants. Some nonmigrants 1 7 The data from North Sulawesi differ from that of Central Sulawesi, where nonmigrants access credit from village landlords and cooperatives while migrants' credit links tend mostly to be with their close relatives. 144 (19.8 percent) and migrants (19.8 percent) also accessed other credit sources such as cooperatives and village banks (more details on these arrangements are discussed in Chapter Five). Table 4.11 Nonmigrant and Migrant Access to Informal Credit Institutions (percentage) Source of Credit Non- Migrants migrants Close Relatives 57.1 51.4 Village landlord 5.4 7.2 Village money lenders 6.3 2.7 Other villages money lenders 0.8 - Money lenders at rural center and small town - - Others 12.4 19.8 Never access credit 18.0 18.9 Total (%) 100.0 100.0 Total (N) 128 111 Source : Sample Survey Data The main reasons for borrowing money from family members are that it is easier to deal with them, and most family borrowers do not have to pay interest because they are borrowing from their parents, siblings, or cousins. Supporting each other like this indicates the strong bonds which link village people. When people need help they support each other, even i f the amount of money borrowed is relatively small. Some respondents mentioned that helping each other like this is the one way they can survive, especially during flood or drought seasons when they can not harvest their paddy and other crops. Geertz termed this kind of relationship "shared poverty" (Geertz, 1963). 145 Investment and Remittances In general, the proportion of both nonmigrants and migrants who can invest some of their money in buying new land is relatively smal l 1 8 , as the data in Table 4.12 indicate. The data reveal that a smaller proportion of nonmigrants than migrants have bought new lands. Both nonmigrants and migrants tend to buy wet rice fields rather than crop fields or fallow land. The proportion of nonmigrants and migrants who have bought crops fields were only 3.3 percent and 5.4 percent respectively. The proportion of nonmigrants and migrants who bought vacant land were just 1.6 percent and 3.6 percent respectively. Table 4.12 Purchasing of Land (Paddy Fields, Crop Fields, and Empty Land) by Nonmigrants and Migrants (According to Percentage of Households) Size of Nonmigrants Migrants Land (%) (%) Bought (ha) PF C F E L PF C F E L 0 94.5 96.8 98.4 82.0 94.6 96.4 <0.5 4.7 1.6. - 18.0 5.4 3.6 0.51 - 1 0.8 1.6 - - - - 1.1-2 - - 1.6 - - - Total (%) 100.0 100.0 100.0 100.0 100.0 100.0 Total (N) 128 128 128 111 111 111 Note : PF = paddy field, C F = crops field, E L = empty land Source: Sample Survey Data Non-migrants and migrants differ in who they purchase land from. The data show that most nonmigrants bought their land from people in the same village, and only a small proportion bought the land from people outside the village or people living in the rural center or small town. 1 8 These findings resemble those based on data from Central Sulawesi, where the proportion of nonmigrants who purchased paddy fields, crop fields, and/or empty fields is small compared with the proportion of migrant purchasers. The proportions of nonmigrants and migrants in Central Sulawesi who bought paddy fields is 6.3 percent and 42.4 percent respectively, while the proportions of nonmigrants and migrants who bought crops fields is 18.8 percent and 36.4 percent respectively. Only migrants (around 15.1 percent) purchased empty land. 146 Most migrants, however, bought their land from nonmigrants outside their villages, and only a small proportion bought from people in the same village or from people l iving in the rural center or small town 1 9 . Some nonmigrants and migrants receive a regular remittance at least once a year from their children, families or relatives who are working, mostly as public servants or workers at private companies, and living outside the region or in the cities. The proportions of nonmigrants and migrants receiving remittances are around 10.8 percent and 6.3 percent respectively. The money they received each year ranges from Rp 50,000 to Rp 500,000. Some respondents mentioned that they received remittances sometimes more than twice per year, while others reported that they did not get money but received presents such as clothing and other things. Most of the money and presents came through the post office or visiting family members or friends in the village, and only a small proportion received the money via village banks. Ownership Differentials Land Land ownership by nonmigrants and migrants is found in Table 4.13. The data reveal that the average land ownership of wet rice fields for migrants is around 2.33 ha per household, a size more than three times greater than the average land ownership of wet rice fields for nonmigrants (who averaged only 0.68 ha per household) . Table 4.13 also indicates that the majority of 1 9 Both these patterns are different compared with the land transfer patterns in Central Sulawesi where both nonmigrants and migrants mostly bought land from people living in the same village, and only a small proportion bought land from people outside the village or living in the rural center or small town. 2 0 The data from Central Sulawesi show similar patterns. There the proportions of nonmigrants and migrants who received remittances are 19.8 percent and 12.2 percent respectively. The amount of money regularly received ranged from Rp 50,000 to Rp 250,000 annually. Some of them also received clothing and other things. The remittances and gifts were mostly sent through families and friends visiting the village, and some came via the post office. 2 1 These findings differ from the Central Sulawesi data, where the average total area of wet rice fields owned by migrants is around 4.68 ha per household, some 10 times greater than the average total area of wet rice fields owned by nonmigrants (only 0.44 ha per household). 147 nonmigrants (57.0 percent) do not have wet rice fields. Only 10.8 percent of migrants do not have wet rice fields. The proportion of nonmigrants and migrants who have wet rice fields sized 0.50 hectares and less are 41.4 percent and 53.2 percent respectively. Only 1.6 percent of nonmigrants possess wet rice fields of 1 hectare or more, compared with 27.9 percent of migrants. The relatively high average land ownership of wet rice fields for migrants is clearly related to the two hectares of land for each family provided by the central government. The relatively low average land ownership of wet rice fields for nonmigrants is strongly related to their culture and skills. They are more familiar working in crop or dry fields than in wet rice fields. Migrants, however, are accustomed to working in wet rice fields, equipped with skills and knowledge they have brought with them from Java and Bal i . Looking at the average land ownership of crop fields, the data indicate nonmigrants have around 1.06 ha per household. This size is more than three times greater than the average land 22 ownership of crop fields for migrants (that size is only 0.29 ha per household) . The proportion of nonmigrants and migrants who do not have crop fields is 42.2 percent and 79.3 percent. Although the average ownership of crop fields is higher for nonmigrants, most of them own crop land of less than 0.50 hectares. Only 2.4 percent of the nonmigrants have crop field of more than 1 hectare. 2 2 These patterns are similar to Central Sulawesi, where the average land ownership of crop fields of nonmigrants and migrants is around 1.01 hectares and 0.80 hectares per household respectively. Most nonmigrants and migrants there occupied land holdings of less than 0.50 hectares. 148 Table 4.13 Land Ownership of Nonmigrant and Migrant Households Size of Land Nonmigrants (%) Migrants (%) Holding (ha) PF C F H L PF C F H L 0 57.0 42.2 7.8 10.8 79.3 8.1 <0.50 41.4 55.5 69.6 53.2 19.8 85.6 0.51 - 1.00 - - 18.0 8.1 - 3.6 1.00-1.99 0.8 1.6 3.1 6.3 0.9 2.7 2.00 + 0.8 0.8 1.6 21.6 - - Average (ha) 0.68 1.06 0.41 2.33 0.29 0.71 Total (%) 100.0 100.0 100.0 100.0 100.0 100.0 Total (N) 128 128 128 111 111 111 Note : PF = paddy field, C F = crops field, H L = home lot Source: Sample Survey Data The average sizes of the home lots (pekarangan) owned by nonmigrants and migrants are 0.41 ha and 0.71 ha per household respectively 2 3. The proportions of nonmigrants and migrants who do not have a home lot are only 7.8 percent and 8.1 percent respectively. The proportions of non-migrants and migrants who have a home lot of less than 0.5 ha are 69.6 percent and 85.6 percent respectively. Only 4.7 percent of non-migrants and 2.7 percent of migrants have home lots of more than 1 hectare. Table 4.14 shows the origins of land owned by nonmigrants and migrants. The data indicate that most (47.8 percent) nonmigrants bought their land from other village people 2 4 . The proportion of nonmigrants who inherited their land from their ancestors is around 22.6 percent. Most (56.4 percent) migrants got their land from government. The proportion of migrants who bought their land from people in the same village or other villages amounts to around 32.8 percent. The proportion of inherited land for migrants is relatively small, only 4.5 percent. These 2 3 The data from Central Sulawesi indicate that the average home lots for nonmigrants and migrants are around 0.66 ha and 1.07 ha per household respectively. Most home lots for both nonmigrants and migrants tend to be less than 0.50 hectares. 2 4 In Central Sulawesi, the data are a little different. Most nonmigrants there inherited their land from their parents, while migrants bought from people in the village and/or received land from the government. 149 people are children of migrants, who moved to Dumoga Subdistrict (as transmigrants from Java and Bali) when their parents had settled in the region. Table 4.14 Origin of Land Owned by Nonmigrants and Migrants (percentage) Origin of Land Non- migrants Migrants Inherited 22.6 4.5 Given by government - 56.4 Purchased 47.8 32.8 Others 29.6 6.3 Total (%) 100.0 100.0 Total (N) 117 107 Source: Sample Survey Data Production Tools One indicator that could be used to show the success of farmers in increasing agricultural production is the availability of production tools in their households. If they do not have enough production tools to farm either the wet rice fields or crops fields (i.e., utensils for clearing, plowing, and harrowing the ground, all important steps of work in the fields before planting of paddy or crops), they must borrow or rent the tools from other farmers, or hire other farmers or laborers to work their fields. A s a consequence, they must cover extra costs for renting those tools and laborers. Table 4.15 reveals that in general the migrants have more production tools than the nonmigrants 2 5. The limitation of nonmigrants in owning production tools such as plows, harrows, oxen, and hand tractors is probably related to the relatively low income they earn each month (as already discussed in an earlier section). Saving enough money to buy these tools is not a simple This finding is similar to the experience in Central Sulawesi. 150 effort for nonmigrants who give priority to fulfilling their basic daily needs. Thus, it is fair enough to say that, based on the production tools they have, the migrants are more professional in managing and exploiting the wet rice fields in order to optimize rice production. Table 4.15 Production Tools of Nonmigrant and Migrant Households (percentage) Production Tools Non- Migrants Migrants Cows 19.0 44.1 Horses 0.8 1.8 Wheels 6.3 3.6 Plow 25.8 57.7 Harrow 22.7 59.5 Hand mi l l 3.1 0.9 Hand tractor - 26.1 Total (N) 128 111 Source : Sample Survey Data Household Goods In developing countries such as Indonesia, (and especially in rural areas), when the households own such luxury goods as a cassette players, V C R s , color televisions, satellite dishes, motorbikes or cars, they are classified as successful farmers. In rural areas the families with luxury goods like these are mostly the landlords, village officials, informal leaders, and public servants, all those who have more access to the resources available, such as natural resources, information, and credit from village banks or cooperatives. Table 4.16 indicates that in general the migrants have relatively more luxury household goods than the nonmigrants. The proportion of migrants who have a bicycle is almost four times higher than the proportion of nonmigrants. In rural areas the bicycle is used as one of the main transportation modes. For farmers the bicycle is very important because it facilitates travel to wet rice fields or crop fields, to the market, or to visit families, relatives, and friends in other villages. 151 Table 4.16 Household Goods Ownership of Nonmigrants and Migrants (percentage) Ownership Non- migrants Migrants Car 1.6 • 2.7 Motorbike 7.8 17.1 Bicycle 16.4 61.3 Radio, Tape and V C R 18.0 34.2 Color Television 18.0 30.6 Black and white television 7.8 15.3 Sewing machine 4.7 6.3 Others (e.g. satellite dish) 14.1 8.1 Total (N) 128 111 Source: Sample Survey Data The data also reveal that the proportions of migrants who have a radio, tape player, and/or television are relatively higher than that of the nonmigrants. A l l these luxury goods are relatively important for accessing information, for example, new techniques to increase agricultural production, information on new seeds and agricultural inputs, marketing information, information related to education, health and family planning. Such information is crucial for people living in rural areas, not only for increasing agricultural production but also for improving rural life. In other words, access to new information transmitted from urban areas is extremely important for developing rural areas. Production The main production of agricultural commodities for both nonmigrants and migrants is indicated in Table 4.17. Paddy is the main product in the region and its production is dominated by migrants 2 6. The data reveal that the proportion of nonmigrants producing paddy is relatively The similar patterns in Central Sulawesi demonstrate that the migrants dominate paddy production. 152 smal l compared w i t h the propor t ion o f migrants producing the same commodi ty . The majority o f nonmigrants produce less than 1 ton o f paddy per harvest (around 3 to 4 months) . The propor t ion o f nonmigrants w h o produce f rom 1 ton to 3.9 tons o f paddy is on ly 9.4 percent. Howeve r , the majori ty o f migrants produce f rom 1 ton to 3.9 tons o f paddy per harvest, and around 3.6 percent can produce more than 10 tons o f paddy per harvest. These statistics are strongly related to the average size o f l and ,owned , especial ly o f wet r ice fields. Mig ran t s o w n more wet r ice fields than nonmigrants for a variety o f reasons. W h e n migrants came to the region, some o f them received parcels o f wet r ice land and the remainder i n dry land ( w h i c h c o u l d be easily changed to paddy field). Some o f them got wet r ice land entirely. Nonmigran t s , however , o w n and farm the dry land that their famil ies have been occupying since their ancestors settled the land. O n l y a smal l propor t ion o f nonmigrants have wet r ice land that they received f rom their parents or bought f rom other people. F i n a l l y , there are also many migrants w h o bought wet r ice fields surrounding their v i l lage f rom nonmigrants. B o t h nonmigrants and migrants produce some seasonal crops such as corn , soybean, and peanut. Table 4.17 reveals that the propor t ion o f nonmigrants who produce such crops is larger than the propor t ion o f migrants do ing so. A m o n g these three crops, product ion o f corn is more attractive to both nonmigrants and migrants than soybeans and peanuts, because most o f the dry fields i n the region are found on rather steep foot h i l l s . In such g rowing condit ions corn product ion is more suitable. 153 Table 4.17 Production of Paddy, Corn, Soybean, and Peanut for Nonmigrants and Migrants (ton) Production Nonmigrants (%) Migrants (%) Scale (ton) Paddy Corn Soybean Peanut Paddy Corn Soybean Peanut 0 74.2 72.7 78.9 82.0 44.1 92.8 96.4 95.5 <0.49 8.6 8.6 7.0 12.5 2.8 2.7 1.8 3.6 0.5 - 0.99 7.0 7.8 6.3 0.8 11.8 - 1.8 0.9 1 - 1.9 7.8 7.8 4.7 3.9 8.9 1.8 - - 2 -3 .9 1.6 3.1 3.1 0.8 25.2 2.7 - - 4 -5.9 - - - - 2.7 - - - 6 -7.9 0.8 - - - 0.9 - - - 8 -9.9 - - - - - - - - > 10 - - - - 3.6 - - - Total (%) 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 Source: Sample Survey Data Some nonmigrants and migrants also produce yearly crops such as cloves and coffee, although only a relatively small amount. They plant these yearly crops together with other crops in their home lot or in the dry fields. Some nonmigrant and migrant also produce coconut to make copra and coconut o i l , and/or to consume themselves. Both nonmigrant and migrant families produce vegetables such as eggplant, spinach, papaya leaf, cassava leaf, and fruits such as banana, papaya, jackfruit, mango, and star fruit. Some vegetables and fruits are sold to village markets and some are eaten by themselves. The Effects of Rural Development Changes in Family and Community Relationships Traditionally, the household head (including Mongondownese, Balinese, and Javanese), usually the husband, takes ultimate responsibility for farmwork. The wife is responsible for household chores such as cooking, washing, cleaning, and child care. However, she also occasionally assists her husband working in the wet rice fields or crop fields. Children in the 154 village are expected to contribute their labor to farmwork when they grow up and finish their schooling. While of school age, children also assist their parents in light household tasks and farmwork. A s a consequence, because children are expected to be a major source of the family labor, most of them are kept on the farm and have limited opportunity for higher education. However, in the modernized rural community where farm technology and especially mechanization is adopted, the role of children has shifted from being the main source of family labor to helping with light farm or household work. With a relatively lesser role in farming together with a better household income, children have a greater opportunity to pursue higher education. This premise is supported by the fact that the majority of members of both nonmigrant and migrant households who own 1 hectare or more of land and have adopted new technologies and mechanization have obtained high schooling. Another interesting change in both nonmigrant and migrant households is the democratization of household decision-making, which has moved toward joint decisions made by members of the family. The family's joint decision-making applies to both rice farming and the adoption of new technologies. This implies that farmers who are family heads in the modernized community have liberalized their attitudes and roles in decision-making by increasing their acceptance of the role and opinion of other members in the family, particularly those of the younger generation who are better educated and have strong aspirations. The field survey revealed that people's participation in the community programs and project is rather more active in the migrant villages, where all households in the village have been organized to contribute, on a voluntary basis, to the cost of improving the irrigation system initiated by village government. Many rural organizations have been established, including farmers' groups, women's organizations which emphasize family welfare, youth groups, and cooperatives. Similar rural organizations have been established in nonmigrant villages but the 155 leve l o f commun i ty par t ic ipat ion is lower . M a n y o f the nonmigrants are not interested i n communi ty group part ic ipat ion, i.e., j o i n i n g the v i l l age cooperative. H o w e v e r , the m a i n reason the nonmigrants i n both v i l lages participated relat ively less i n rural development is strongly related to the fact that the majori ty o f nonmigrant farmers compla ined about the leadership o f their v i l l age head. In other words , they are unsatisfied w i t h the leadership o f their v i l l age head, but they have to wai t un t i l the next v i l lage head election, w h i c h is he ld every 8 years. Changes in Expectations and the Economic Base of the Household In general, most households i n both nonmigrant and migrant v i l lages do not expect m u c h change i n their o w n society. Howeve r , farmers i n both migrant and nonmigrant communi t ies h o l d h igh expectations for an increasing role for technology i n their farming. The data also indicate that there are h igh percentages o f both nonmigrant and migrant farmers w h o have strong expectations for the expans ion o f pub l ic ut i l i t ies , especial ly improvements i n i r r igat ion networks, v i l l age roads, education and health services. H o w e v e r , for households w h o o w n less than one hectare o f land, there is a greater prospect o f increasing demand for new farming technologies. The i r current demand for nonsubsistence goods such as electr ical appliances, transportation and communi ty uti l i t ies is lower than that o f the households who o w n more than one hectare o f land. T h i s means that the relat ively poor households ' p r imary demand is an improvement i n their farming prospects and income, rather than i n their socia l needs. O n the other hand, households w h i c h are better o f f and enjoy a higher income expect more luxury goods and facil i t ies. The f i e ld survey o f both nonmigrant and migrant households shows that the adopt ion o f new technology, especial ly hand tractors, and the support o f i r r igat ion networks have resulted i n an increase i n both farm and nonfarm incomes. Some changes i n the lifestyle o f farmers w h o 156 own more than one hectare of land can be observed. With higher incomes they tend to spend more on nonsubsistence goods and activities such as color televisions, satellite dishes, motorbikes, and shopping in nearby small towns. There are two restaurants in the migrant village, Mopuya Selatan, which offer a variety of fashionable food, music and fi lm through television with a satellite dish. A private medical clinic also provides health service on a daily basis for the community. These kinds of change in lifestyle keep pace with what is taking place in towns. Motivation of Migrants and the Comparative Advantages A l l of the migrants sampled were interviewed about their motivation and decision to transmigrate to Dumoga, North Sulawesi. A majority of the respondents mentioned that they took part in the transmigration program because of deep poverty, no properties or land, hopelessness and the absence of economic alternatives on Java and Bal i . They hope for a better life for themselves and their children in transmigration areas or new places. Some migrants from Java described their life in Java, where they were landless and worked as agricultural laborers, earning very low wages of around Rp 500 or Rp 600 a day. When the transmigrants had just arrived in Dumoga Subdistrict, they continued to work as laborers but they also worked their own land to produce for their own consumption. They still did not have sufficient rice for the whole year. They often had to eat corn as they were used to doing in Java and Bal i . However, they felt better off in Dumoga because one day's work brings in enough to have food for two days or more, while on Java the daily wage was just enough to buy food for a day. There was also one group of migrants who had lived in a satisfactory economic situation in Java and Bal i . They owned land there, but not enough to guarantee a sufficient income and 157 education for their children, so they decided to transmigrate. Another group consisted of farmers of good economic position. They decided to transmigrate for motives of economic expansion. They are owners of bigger land holdings on Java, now cultivated by relatives or their own children, but see more progress in North Sulawesi because of land resources and demand for labor. One strong motivation for the migrants was to get a better price for their products. When roads to the village settlements were not built by the government, the roads were in extremely bad condition and could be accessed only by carts drawn by horses or cows. Agricultural products had to be taken to the nearest village markets, which were a 4 to 5 hour walk, in order to fetch a decent price. Local nonmigrants did not share these attitudes. They sold most of their products in the village for very low prices. Quite often they earned no profit on their products. Learning from past experiences in agricultural practices, the transmigration farmers who originated from Java and Ba l i generally had agricultural work experience prior to resettlement and were highly skilled in wet rice farming practices. Therefore, the skills that they had been practicing since they were children on Java and Ba l i were the main capital they brought with them for starting a new life and surviving in a new place. Their farming skills were a comparative advantage at destinations such as Dumoga, North Sulawesi. The local nonmigrants, on the other hand, were considered to be less skilled in agricultural practices. They were accustomed to practicing "shifting cultivation', as had their ancestors. The main agricultural activities depended on dry field seasonal crops such as corn, cassava, sweet potato, peanuts, some kind of vegetables, and yearly crops such as coconut and clove. There are only a relatively small proportion of nonmigrants who have wet rice fields, but 2 7 This traditional agricultural practice is often referred to as 'slash and burn' and is undertaken by cutting and burning the forest for transplanting short-term crops. The fields are usually abandoned after several crops, resulting in erosion and land deterioration. 158 these are without irrigation systems and depend on rainfall, and thus produce paddy only once a year. Thus, it is obvious that nonmigrants have less experience and skills for farming wet rice fields. The Contribution of Migrants to the Region In general, almost all farmer migrants who settled in the four case study village areas have adequate knowledge of farming systems and technology applied in wet rice fields. The migrants from Java are mastering the management of crop fields on dry and/or steep land. Their knowledge of developing terraces on steep land, rotating crops, and utilizing the grass for breeding livestock is quite advanced. The migrants from Ba l i really know how to manage water and farming systems including optimizing the use of agricultural production tools. The survey findings predict that the migrants w i l l easily manage by themselves to utilize the resources once they have the production tools and are supported by basic infrastructure such as irrigation systems and village roads. The knowledge and technologies brought with migrants have been adopted by some local farmers and could, therefore, increase their production. However, certain technologies for producing soybeans have not been well-adopted by local farmers. The local farmers are not yet capable of producing soybean yields like those produced by the migrants, even i f they apply similar inputs and technology. On the other hand, some transmigrants adopted the ways of local farmers in letting their animals graze in the empty fields or meadows, since uncultivated land is still available in some areas. Thus, the migrants have given up their previous practice of keeping livestock in stalls. The migrants have also made a significant contribution in increasing the production of rice, corns and soybeans in the region, as a result of expanding the land base that could be 159 exploited to produce rice, corns, and soybeans, and adopting new technology and cultivation techniques. The main contribution of the migrants to the region is in production of soybeans which is a relatively new crop for local farmers, and was only introduced to local farmers after the migrants settled in. the region. Recently, North Sulawesi has begun exporting soybeans to Java. Some Special Issues of Changes and Problems The processes of technical and social change differ from area to area and region to region. In some areas, particularly in remote areas, social change is still technically induced. In this case study, it is quite clear that certain social changes induced by commercially oriented farming have enhanced the adoption rate of new technology. In other words, social change has induced technological change in both nonmigrant and migrant villages. The only limitation for subsistence farmers is their low purchasing power or household income. On the other hand, a factor which speeds up the adoption of new technology and mechanization, especially for the rich farmers, is the availability of irrigation systems and changes in cultivation practices. For example, in the wet rice fields, fast growing grass and weeds which thrive due to irrigation have made plowing land by means of horses or cows problematic. This is because the land overgrown by increased grass and weeds requires stronger tilling power than that which horses or cows can provide. Using hand tractors or power tillers has solved the problem. Thus, the village communities in this case study have experienced technological changes in rice farming through both social change and government investment in technologies such as irrigation systems, new varieties of seeds, and rural road and transportation networks. The 160 changes have been followed by multiple cropping in rice and more farmers being able to find more time for off-farm and nonfarm jobs, both in the villages and outside the villages. The distribution of the benefits of technology among recipients has been a major concern in many developing countries. It has been argued that the distribution of benefits from technological change is uneven, both within agriculture and between agriculture and the rest of society. A s far as this case study is concerned, the findings show that the introduction of new technologies, mechanization and irrigation networks tend to benefit farmers who own more than one hectare of land, in this case mostly migrant farmers. Thus, the uneven distribution of the benefits is quite a critical issue between farmers who have access to technology and those who do not. Given this equity problem, one still cannot definitely conclude that technological improvement w i l l lead to a better distribution o f gains. Because of limitations due to the nature of technology, socioeconomic and geographical constraints, and different social as well as political environments, technological change does not always bring a positive distribution of benefits and income. In the area of the four case study villages in Dumoga Subdistrict, the climate and geographical conditions are not generally favorable to increased cropping intensity. The more critical problems in agriculture are water shortages, periodical drought and widespread plant diseases. The crucial need of farmers is for water, and then the adoption of new technologies and mechanization becomes possible. The government's role in the construction of irrigation dams, water supplies and rural roads is the key to expanding farm output and income in the region, and critical for the viable use of new technology for the rural poor. To achieve the goal of contributing to regional development in the settlement areas, the migrants have to be integrated into their economic and social environment. There is evidence from some settlement areas that the process of this integration is becoming a problem between 161 migrants and nonmigrants (Hardjono, 1977, Swasono and Singarimbun, 1985). In the four villages of the case study areas, it can generally be said that there have not been serious problems o f integration between migrants and nonmigrants. When the migrants first arrived in the region, they had problems o f communication with the local people, but only a few migrants mentioned that the local people were not friendly to the migrants. However, the data indicate that the average land ownership by nonmigrant households is shrinking, especially for wet rice fields, while for the migrant households, the average ownership of wet rice fields is increasing, causing a greater discrepancy in the average income between nonmigrant and migrant households. If these trends continue they w i l l become such seeds of jealousy among the local people that their deep dissatisfaction could jeopardize future conditions in the region. Conclusion The aim of this chapter has been to outline the major demographic, cultural and socioeconomic characteristics of nonmigrants compared with migrants, the effects of rural development, the motivation o f migrants, and the contribution o f migrants to the region. In general, the migrants are slightly older and they have a slightly higher education than the nonmigrants. The migrants' main occupation is that of farmers (own land) while less than half of the total number of nonmigrants are farmers (own land), and many of them are laborers. The incomes of both nonmigrant and migrant farmer households are not only earned from the agricultural sector but also from nonagricultural sectors such as services, trade, and rural industries. In general, the average income of migrants households is higher than that of nonmigrants household. The average income gained from agricultural sectors by migrant households is more than two times higher than that of the nonmigrant households. O n the other 162 hand, the average income earned from nonagricultural activities by nonmigrant households is slightly higher than that earned by migrant households. The average costs for daily needs of nonmigrant households is slightly higher compared with migrant households. However, the average annual expenditures of migrant households on education, health, clothing and others is high compared with the spending o f nonmigrant households. The average expenditures for utensils and furniture is higher for nonmigrant households than for migrant households. The proportion of migrants who invest their money in buying land is higher than the proportion of nonmigrants. The average land ownership, especially for wet rice fields of migrant households is around three times higher than that of nonmigrant households. However, the average ownership of crop fields or dry lands is higher for nonmigrant households than migrant households. On average, migrants produce more rice than the nonmigrants, due to the fact that the migrants own more wet rice fields and more complete production tools. However, the proportion of nonmigrant households producing seasonal crops such as corn, soybean, and peanut is quite a bit higher than that of the migrant households. The success of migrant households in developing and managing their resources and land is strongly supported by their motivation to improve their lives by use of their skills that have been developed since they were children working in wet rice fields on Java and Bal i . The nonmigrants' skills that serve as comparative advantages are mostly familiarity with work in the dry land or crop fields. The migrants have made significant contributions to increasing rice, corn arid soybean production in the region. However, the success of migrants in terms of socioeconomic development is not only a consequence of their high motivation and skills, and traditional culture of wet rice production, but also of support by the central government which 163 provided cleared land (fertile land in the region), a house, tools, and food support for one year, and which built basic infrastructures such as dams and irrigation systems, rural roads and transportation networks, education and health services, all requiring a huge government investment. According to a World Bank consultant on transmigration programs in Indonesia (Davis, 1987) the costs of settlement averaged around US$ 5,300 per family. The rural development policies for intensification of rice production by means of introducing new technologies and mechanization, have had significant impacts on income distribution among both farmers with small and large amounts of land, as well as landless laborers. The community's socioeconomic environment has improved, and the family lifestyles and consumption behavior have changed to those of a modern society. The rural development policies also appear to have increased the role of formal participation of farmers in the community. In short, this chapter has shown that rural development policy emphasizing the goal of rice self-sufficiency is strongly influencing the rural population of both migrants and nonmigrants. This policy is only beneficial to rice farmers who are mostly identified as migrants. Because of this, the gap between migrants and nonmigrants (especially in terms of land ownership and income) is increasing. In other words, this policy is not supporting nonmigrants who are mostly working in dry fields planting traditional crops such as cassavas, soybeans, corn, and peanuts. Therefore, rural development policies must change to an orientation that is beneficial to both migrants and nonmigrants. Attention should be given not only to increasing rice production but also to increasing production of traditional crops (such as cassavas, corn, soybeans, and peanuts) and other plantation crops such as cloves, cacaos, and coconuts. Having analyzed the characteristics of nonmigrants and migrants and the impacts of rural development policies which could form the basis for future social, economic, and rural 164 development planning in North Sulawesi, attention w i l l now be turned to an analysis of the major patterns of linkages between rural and urban areas. 165 CHAPTER FIVE RURAL-URBAN LINKAGES Introduction The linkages between rural and urban areas tend to occur via variables related to economic interaction, migration, service delivery, physical infrastructure, and technology as has been discussed in the conceptual framework in Chapter One (see Figure 1.1). Although these linkages have significant impacts in increasing rural development both economically and socially, the public facilities are mostly enjoyed by the middle and top classes of village farmers. The rural center and small town are primarily service centers and have a relatively small impacts on rural development. This is due to the fact that in contrast to provincial and central governments, local governments can provide only very limited functions for concerns directly related to the region. Thus, rural-urban development tends to be approached from two different and separate sides rather than being bound into one entity of development. The aim of this chapter is to identify and analyze the main variables that indicate the linkages o f rural areas to the hierarchy of urban areas. For example, there are economic variables, which include public markets, consumption, capital flow, marketing and production. The migration variables includes various aspects o f social interaction. The service delivery variables cover education, health services, cooperatives, bank and credit institutions. The physical variables involve transportation networks, irrigation systems and electric power. The technology variables cover information and communication. In this study the urban hierarchy is identified as being the rural center or the subdistrict capital, the small town (district capital), and the medium city (provincial capital). The chapter also analyzes the government policies related to rural-urban 166 linkages and the levels of government which are involved in setting and implementing those policies. Economic Linkages The Patterns and Linkages to the Public Markets A market center is a nucleated settlement with one or more markets each week. In the case study of the four villages in North Sulawesi, only one village does not have its own market. In comparison, in the three villages in Central Sulawesi, only one village had its own market which was open every day. In North Sulawesi, each market is open twice a week according to a schedule that has been set up so that during the whole week there is a market open in one of the different villages in Dumoga Subdistrict. In general, the market is open only half a day, starting around 6 a.m. and lasting until about noon. A wide variety of commercial activities are usually associated with the larger market places. Most rural markets offer opportunities for small farmers to trade their products such as vegetables, fruits, grains (soybean, red bean, nuts, and corn), and other staples; for stock raisers to sell goats and chicken; for fishermen to sell their catches; and for artisans to sell or trade textiles, baskets, household utensils and an enormous variety of household goods. Services located near the market place can reach large numbers of consumers more efficiently. A l l the village markets in the study areas were initiated by village governments together with communities who prepared the location and built the markets. Afterward, the local government improved the building and the market environment with funds from both the local budget and presidential grants for market facilities (Inpres Pasar) from the central government. A l l traders who use the market facilities have to pay fees to the village official each time they come to the market which are based on the size of space used for selling goods. The fees vary 167 from Rp 250 to Rp 2000 for each trader. A part of the market fees goes to village government as village own revenues and the rest flows to the district government (via the subdistrict government) as local government own revenues. In general, both nonmigrants and migrants go to the village's markets or to the neighboring village's markets twice a week. Most of them go to the market