TITLE:
Demand for Indonesia’s Coconut Crude Oil in the Netherlands: Application of LA/AIDS Model
AUTHORS:
Imanuel do Rosário Ximenes, Rita Nurmalina, Amzul Rifin
KEYWORDS:
Coconut Crude Oil, LA/AIDS, Competition, Indonesia
JOURNAL NAME:
Open Journal of Business and Management,
Vol.10 No.1,
January
6,
2022
ABSTRACT: Besides the Philippines, Indonesia is the second-largest coconut crude
oil exporter country in the Netherlands. The level of competition for Indonesia’s
coconut crude oil (CCO) is necessary to estimate in the main market. The
primary aim of this study was to analyze the level of competition for Indonesia’s
coconut crude oil in the Netherlands, using a
linear approximate AIDS model. The data used monthly time series on import
values and quantities from 2004 to 2019 by the Netherlands. The results
indicate that Indonesia’s position in the Netherlands was inferior compared to
the Philippines. The own-price elasticity of Indonesia’s coconut crude oil was
non-sensitive to the price change. Moreover, Indonesia and the Philippines were
competing with each other. Thus, increasing the coconut crude oil export and
improving quality size is one of the alternative strategies to catch up with
the competition in the Netherlands.