Evaluation of Agribusiness Strategies in Enhancing Food Security in Indonesia: The Role of Productivity, Market Access, and Farmers' Terms of Trade

¹ Department of Sharia Economics, Universitas Muhammadiyah Yogyakarta, Indonesia
² Research Fellow, Universitas Muhammadiyah Yogyakarta, Indonesia
³ Department of Business Administration, Asia University, Taiwan
⁴ Department of Finance, Fintech and Blockchain Research Center, and Big Data Research Center, Asia University, Taiwan
⁵ Department of Medical Research, China Medical University Hospital, Taiwan
⁶ Department of Economics and Finance, The Hang Seng University of Hong Kong, Hong Kong.

^* Corresponding author: This email address is being protected from spambots. You need JavaScript enabled to view it.

Abstract

This study assesses the effectiveness of agribusiness strategies in improving food security in Indonesia, with a focus on the interrelated roles of productivity, market access, and farmers' terms of trade (ToT). Addressing research gaps, it examines integrated frameworks that incorporate social, institutional, and localized agricultural dynamics. A quantitative approach using the Autoregressive Distributed Lag (ARDL) model was employed to analyze both short- and long-term impacts of agribusiness strategies on food security indicators. Data were derived from agricultural productivity statistics, market access indices, and farmers' income levels. The ARDL results reveal a significant relationship between agribusiness strategies and food security outcomes. Improved market access enhances productivity, strengthens farmers' ToT, and promotes sustainable food security. Cooperative engagement plays a pivotal role by increasing negotiating power, lowering transaction costs, and improving access to profitable markets. Access to essential inputs, financial services, and institutional support further reinforces positive outcomes. Findings underscore the importance of targeted interventions, including strengthening cooperatives, expanding credit availability, and investing in transport infrastructure. The study contributes by offering an integrated framework that captures the dynamic interplay of productivity, market access, and ToT. It also highlights the critical role of demographic shifts and youth engagement in ensuring sustainable agricultural systems.