Evaluation of Market Operation Policy using System Dynamics
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Abstract
Rice is an important staple food for Indonesian people. Currently, retail rice price has been always above the highest retail price (HRP) set by the government, which is Rp. 9,950/kg. Logistics Affairs Agency (Badan Urusan Logistik BULOG) has an important role in maintaining food availability and stabilizing rice prices. In order to stabilize the prices, BULOG is assigned to carry out market operations. However, the price of rice has remained above the HRP for the last 10 years. For this reason, it is necessary to evaluate the impact of market operations on controlling rice prices. The evaluation is carried out by simulating the implementation of market operations using the System Dynamics with AnyLogic software. Three experimental scenarios were carried out, namely by increasing the absorption of BULOG and market operations by 10%, 30% and 50%, then simulation was carried out in 60 months. Model verification is done to see if there is an error in the model. The model validation was carried out by means of the Mean Absolute Percentage Error (MAPE) test and the results obtained were 0.908% so that the model can be said to be valid. Results show the largest decrease in rice prices for a 10% increase is 0.134%, for a 30% increase it is 0.401% and for a 50% increase it is 0.668%. It can be concluded that market operations have no significant impact on the decline in rice prices. The government should look for other alternatives to control rice prices apart from conducting market operations.
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This work is licensed under a Creative Commons Attribution 4.0 International License.
This work is licensed under a Creative Commons Attribution 4.0 International License.
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