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REORIENTING RURAL LIVELIHOODS ON JAVA :

THE CASE OF BANTUL REVISITED

Henk Huisman
Faculty of Geosciences, Utrecht University, The Netherlands

From a review of recent Javanese village studies as conducted by human geographers

and other social scientists, it appears that most of the researchers= attention has moved away
from the role of agriculture in alleviating rural poverty towards the role of rural non-farm
sectors.
At present, it seems that the rural non-farm activities= contributions to employment and
income opportunities in the rural areas in situ are considered as very important. In particular
their capacity to counterbalance rural-urban migration and its negative consequences in terms
of increasing urban management, congestion, pollution and poverty problems, is seen as
crucial. In addition, the impact of rural non-farm activities on the performance of agriculture
and food security is considered to be positive (cf. Islam, 1997; Shepherd, 1998). In line with
these observations, researchers and policy makers now seem to view rural diversification -
defined as the growing importance of non-agrarian production, employment and income for
rural households - as constituting an intricate part of a sustainable betterment of production
and living conditions in rural areas. The positive nature of this assessment is not challenged
here. Rather it is argued that a proper understanding of the multifarious issues involved
requires a re-formulation of the main conceptual starting points.
Modern regional geographers emphasize that because external factors interact with
both meso level and local factors, patterns of regional economic development are highly
differential. Consequently, rural diversification processes can neither be interpreted as uni-
dimensional, nor as uniform. Recently, a range of empirical studies has become available that
make clear that two distinct types of rural diversification exist ( cf. Alexander et al., 1991;
Saith, 1992; Titus et al., 1994; Tambunan, 1995; Huisman & Kragten, 1995; 1997; Rotge et
al., 1995; Islam, 1997; Titus & Hinderink, 1998; Ellis, 1998; Kragten 2000). On the one hand,
there is the rural employment and income increasing-type of diversification which is intricately
related to processes of dynamic economic development. This development is, among other
factors, driven by the increasing integration of regions in both the national and international
economy. It is reflected in growing commercial and industrial activities in the rural areas,
caused by such factors as growing surpluses in a dynamic agricultural sector or economic
spill-over effects of urban activities and capital. It may also be reflected in increasing mobility
of members of rural households to urban centres in the region (both through commuting or
circular labour migration). Spatially the magnitude and nature of this dynamic type of rural
diversification processes differ strongly. In the densely populated small farm areas of East and
Southeast Asia, for instance, these processes are already far advanced, such in clear contrast
to the situation in most Sub-Sahara African and Latin American countries. Until the so-called
Asian crisis - which began in the second half of 1997 - factors such as agricultural surplus
generation, market development and an enabling policy environment have led to increasing
sectoral inter linkages manifested in the ongoing diversification of rural economies and, in a
number of regions, in a gradual de-agrarianization (cf. Bryceson, 1996)
On the other hand, we find the survival-type of diversification of non-farm income gene-
rating activities related to processes of marginalization. This process occurs when a (relative)
stagnation or even decline of the agricultural sector's capacity to provide employment and
income to all of the rural population is accompanied by a lack of viable employment and
income alternatives in other sectors. Agricultural sector capacity shortcoming can be resulting
from a range of factors. These include longer term problems, such as land constraints and

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environmental degradation, or temporary events, such as policitical turmoils and conflicts,
harvest shortfalls because of drought, and other risks of farming such as a failure of markets,
farm input markets or other institutional bottlenecks. If they have the capacity to do so, these
problems and the absence of viable alternatives elsewhere necessitates (part of) the
populationto seek refuge in additional activities of a marginal nature in order to survive. It has
also been observed, that pull processes of economic development and the pushing out of
workers from the agricultural sector can occur simultaneously within one geographical entity.
Hence, it should be noted that rural diversification can be brought about by completely
different mechanisms that can be at work simultaneously within the same context.
Moreover, it should be emphasized that in juxtaposition of the diversification into non-
farm income generating activities, processes of diversification within the farm sector may be
taking place as well. Such an agricultural diversification towards the non-staple food
production-oriented activities demands the application of various capital inputs and technology
and implies a rise in processing, transport and marketing activities. It consequently results in
a strengthening of the linkages of the agriculture with the non-agricultural sectors and the
economy of other regions and urban areas. In a very broad sense, therefore, such an
agricultural diversification may be considered as constituting a part of rural diversification
processes. Finally, it needs stressing that diversification at the rural household level is often
directed at various income generating ventures which may be carried out by its members at
different locations, both within the agricultural sector and in the non-agricultural sectors. This
multiplicity of jobs and income sources, prominently including those in agriculture, seems to
be often preferred above opportunities that are limited to activities in industry and commerce,
possibly even if a concentration of efforts in the latter sectors have the capacity to generate
(considerably) higher returns to labour time input. Obviously, such is related to a deliberate
strategy of households to spread risks, but may also be an expression of a persisting
preference among part the rural population of seeking income increases in farming through
agricultural diversification, rather than obtaining income increases from non-farm employment
opportunities (Fujimoto, 1994, p. 71).
This paper attempts to illustrate the importance of these aspects and draws attention
to the key-roles of both geographical (i.e. contextual) and conditioning factors in processes
of rural and agricultural diversification. To facilitate this, a Javanese rural case study will be
presented. It concerns interesting evidence on dynamism in a village economy where in the
past diversification was brought about by supply-push factors and, albeit to a far lesser extent,
by demand-pull forces. Recently - under the apparent influence of the above mentioned long
lasting preference for farming among rural dwellers- the income and employment generation
in non-staple-food production activities taking place in this area have experienced
considerable growth. Since this process has occurred not only in absolute sense, but also at
the detriment of the non farm income generation activities, it is thus particularly challenging
to establish to what extent the label of re-agrarianization is justified to characterize its nature
and to look into the effects on the communities.
The following includes, first, a synopsis of the geographical setting, both at the relevant
meso and micro levels. This contextual information forms the backdrop to the examination of
the how and why of rural and agricultural diversification processes and the resulting patterns
of change and transformation. Second, the local economy is characterized with a special
focus on the structure of employment and income generation. Finally, the consequences of
local change for labour relations will be zoomed into, with a view to determine the extent of
the local societal effects of this specific process of economic change.

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 Study Area
Central Javas Special Province of Yogyakarta is densely populated, but until 1997
developed rapidly. Over the decade 1987 - 1997 the economic growth amounted to 6 to 7%
per annum, on average. Despite this impressive growth, the creation of new employment
opportunities could not keep abreast with the increasing numbers of newcomers on the labour
market and un- and underemployment has remained a serious problem. The distribution of
the labour force over the various sectors in the province deviates considerably from the
pattern as generally observed in rural Java. Whereas in the early 1990s, in the rural areas of
Java as a whole still close to 60% of the labour force was mainly agriculturally engaged, over
the last decades in the rural parts of this province the share of the agricultural sector has
remained stable at a comparatively low 45%. Presently, although the proportion of the rural
labour force in the craft and manufacturing sector in this area has decreased, it is still much
higher than the average for rural Java. The lion's share, i.e. 80%, is involved in
cottage/household industry and, although it has risen considerably, the share of wage labour
in craft and manufacturing industry is still much lower in comparison to Java as a whole.
Bantul District is one of the Province=s four districts that can be deemed representative
for the conditions in the area at large. Bantul (507 square kilometres) is situated just south of
the City of Yogyakarta (cf. Figure 1). In 1996, the population amounted to 744,813 persons,
which implies a population density of 1469 (PEMDA Bantul 1997). Since half of the land area
is used permanently as farmland, the agricultural population density is about twice as high,
i.e. about 3000 persons per square kilometre. The district enjoys a good access to the islands'
major transportation routes, i.e. railways and roads. It can be subdivided in a number of
distinct zones, viz. a rather flat lowland area in the central and southern part, a calciferous
plateau in the western part, and a topographically rather rough upland area in the eastern
part.
The eastern upland area is clearly demarcated from the lowlands by a steep
escarpment with slopes of 40 per cent and over, which rises to an altitude of some 500 meters
above sea level.
Soils are lateritic and have low fertility and moisture retaining capacity. The western
plateau, which rises to an elevation of some 150 meters above sea level, also has soils with
limited agro-ecological capacity. In contrast to these parts, the central lowland zone - which
comprises the main part of the district - is offering a highly valuable agricultural production
potential. It has thick soils of volcanic origin that are highly fertile with favourable moisture
retaining capacity levels. The topography allows for permanent irrigation on a large scale.

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Table 1: Employment statusa in the rural parts of the Province of Yogyakarta by main non-
agricultural sector, 1971 and 1990 (%).

Main Non- agric. Sector Self-employment Wage labour

1970 1990 1971 1990

Manufacturing & crafts 48 26 25 46

Trade 83 73 5 8
Services 13 15 83 82

Total 49 35 33 49
a
The remaining share largely comprises family labour, i.e. 17% in 1971 and 16% in 1990.
Source: Sensus penduduk 1971, seri E No. 12, Sensus penduduk 1990, Seri S2.12.

Agro-ecological differences are also clearly reflected in the distribution of the

population over the district. In the eastern and western part, the population density is less than
600 per square kilometre -in the central part, figures are up to five times as high. Although
agriculture still constitutes the most important single source of employment in most of the
district, large differences can be seen between the various zones. In the peri-urban parts near
Yogyakarta, non-agricultural activities make up the main activity for more than 65 per cent of
the households (Huisman 1994). In the other parts a close relationship exists between the
agricultural system (dry or irrigated agriculture) and the involvement of the households in non-
agricultural activities. In the central wet-rice cultivation area land is a scarce resource and,
consequently, the non-agricultural activities make up the main source of employment for
almost half of the households; where dry land farming prevails, non-agricultural activities
comprise a secondary source of employment only (ibid.).
Non-agricultural activities encompass trade (11 per cent of the total number of active
persons), construction (7 per cent), government services (9 per cent) and manufacturing (8
per cent) (PEMDA Bantul 1995). In this relatively small area, the various types of agricultural
potential are present: in some parts, because of the availability of sophisticated irrigation
systems, a highly intensive wet-rice cultivation is possible, in other parts semi-subsistence
production, with fluctuating but mostly small surpluses, predominates.
On the whole, since the 1970s the output of the agricultural sector has increased
strongly; also the Gross Regional Product (GRP) has increased substantially albeit at a lesser
rate than in the other parts of Java. In the 1980s and early 1990s average growth rates per
annum in the range of 5% to 6.4% are reported, against a national average of 7% for that
period. In 1994 and 1995 the growth rates in Bantul showed further improvement: levels of
8 and 7%, respectively, could be realized (Data from Kantor Statistik D.I.Y. 1981; 1986; Data
from Kantor Statistik Bantul 1990; 1994; 1995; 1996; Hill 1994). In the mean time, the

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composition of the GRP has changed considerably as well. The share of the agricultural
sector has declined from 54% in 1975 to 30% in 1993; the industrial sector increased its share
from 12 to 18% and trade and services from 12 and 5%, respectively, to both 17%.

Table 2: Economically active population by sector in rural Bantul District, 1970 and 1990 (%).

Sector 1970 1990

Agriculture 45 43

Craft & Manufacturing Industry 29 20

Construction 1 8
Trade 14 15
Transport & communication
Services 6 9
Other 1 3

Total 100.0 100.0

Source: Population Sensus 1971 Seri E no.12 and Sensus Penduduk 1990, Seri S2/12.

The spatial distribution of the various types of craft and manufacturing activity shows
a strong tendency of clustering in certain locations, sometimes in obvious response to
availability of resources (for instance, a certain type of clay suitable for the production of bricks
or rooftiles), or as an outcome of a historically grown process of specialization in village
communities. In addition, it appears that much of the small and medium-scale industry is
concentrated in the peri-urban sub-districts, bordering the territory of Yogyakarta City.
Our case study is situated in Kretek sub-district in the southern part of the central zone.
Although some of its key-characteristics are typical for this area, recent changes in its farming
system and the ensuing consequences are worthy of further investigation. The dominant
farming system is the so-called mixed sawah system as characterized by a rotating cultivation
of the main crop rice in the wet season with cash crops such as maize, soy-bean and
groundnuts (polowijo) in the relatively long dry season. The intensification of wet rice
cultivation has taken place following the introduction of the technology innovations as part of
the Green Revolution, namely of packages of High Yielding Variety (HYV) seeds, fertilizers,
biocides and credit. The production of cash crops such as soybeans, maize and groundnuts
has also been positively influenced by the application of fertilizers. However, the application
of HYV to grow these crops is not common yet. In most villages, the production of horticultural
products is relatively insignificant and remains largely confined to the home gardens
(pekarangan) The non agricultural activities are mainly limited to the production of palm sugar
(gula jawa) in household or cottage industries, to construction activities and to various forms
of trade and petty trade. Linkages with agriculture are limited and most of these activities are

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of the labour supply-push type, i.e. surplus labour has taken refuge in these activities because
of lack of viable alternatives in employment and income generation. However, the products
of most craft activities are not only serving the needs of the local markets, but also cater for
demand in urban centres. Migration plays its part both in temporary and permanent form. Due
to the time and costs involved in daily transport to the main centres of employment such as
Yogyakarta, daily commuting however is less common as elsewhere in the central lowland
zone.
The study village Tirtosari) has 5,500 inhabitants who are subdivided over 1108
households with an average size of 4 members. Even for Bantul standards the (rural)
population density is high, i.e. close to 2000 persons per square kilometre. Nevertheless, nine
out of ten households are engaged in agriculture. However, for only one out of ten households
agriculture forms the only source of income. Apart from a small group (5%) which derive their
income from renting out out land or government pensions, all of the remaining units are
involved in both agricultural and non-agricultural income generation activities. Although
virtually the whole agricultural area of 219 hectares is irrigated, the level of sophistication
varies considerably: Especially in the southwestern part of the village irrigation depends on
simple earthen channel systems or even comprises of largely rain-fed sawahs; elsewhere so-
called semi-technical systems constructed from concrete predominate. Due to the relatively
long distance from the river as the main irrigation water source, investments in technical
systems which also allow for fine-tuned water velocity control, have not been made.

Resource access : land

(a) A quarter of the households in Tirtosari has no access to agricultural land at all. The
incidence of this landlessness is closely related to population pressure, conform with the
situation elsewhere in Bantul=s central zone. Virtually every household, however, has access
to a homeyard (pekarangan), with an size of 600 square meters on average, on which both
palm and fruit trees are usually present;
(b) The land base is heavily fragmented: the average size of cultivated land by farming
households is 1760 square metres. Under traditional inheritage arrangements the plots were
repeatedly subdivided among heirs taking account of differences in fertility, location and other
aspects. At present, individual parcels of land usually are not subdivided anymore over the
heirs. Rather all land is allocated to one child, the livestock and the house to another, etc.
Especially in areas with extreme population pressure such as Tirtosari, the selling of land and
the distributing of the proceeds over the heirs can increasingly be observed;
(c) The landholding households form a rather homogeneous group: more than half of the

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farming households have to do with less than one-tenth of a hectare (<1000 m2), while the
farmers who have access to half a hectare or slightly more (>5000 m2) comprise less than
3% of all farming households; and
(d) The terms on which the land is normally utilized vary considerably. Most farmers (69%)
are owner of the land they cultivate. Some 72% of these farmers only cultivate their own land.
The remaining group also leases small plots (mostly <1000m2) of sawah in addition to the
land they own, or exclusively cultivate leased land (11% of total). In a limited number of cases
landless farmers also obtain access to land on the basis of sharecropping contracts.
The leasing arrangements and the costs involved vary strongly: for the growing of rice, land
is usually not rented on a yearly basis, but per crop cycle; for horticultural cultivation purposes
annual contracts are common. It is striking to note that the costs involved directly depend on
the crop cultivated: on average, leasing of land for high-input high-output horticulture is at
least twice as expensive than for the growing of rice.

Resource access : labour, capital and other inputs

Although the land resources available are limited, the intensive nature of cultivation
practices requires most households to supplement their family labour input at various stages
of the cropping cycle (in particular land preparation, planting and harvesting are peak periods):
7 out of 10 farming households make use of agricultural labourers on a regular basis. The
other units incidentically hire labour during peak periods. Farmers hire agricultural labourers
from both the district itself as well as from outside the district. A regular labour movement from
the northern part of the Province is reported, especially from the dry land areas where un- and
underemployment are common.
Livestock is kept by half of the farming households; however the number of animals is
usually limited to a one or two ruminants for traction power and dung, and some goats, sheep
and poultry for their products. The majority (70%) owns the animals, the remaining
households take care of livestock for others, mostly in return for the animals= offspring. The
ruminants are usually put in stables and are fed with grass and agricultural leftovers (a system
also known as zero-grazing). The raising of livestock is not commercially-oriented, but is
largely meant for subsistence purposes.
Large-sized implements for soil tilling are hardly owned in the area: less than one-third
of the households having access to land have a plough and /or a harrow at their disposal.
Farming households rent cattle and plough and harrow, or only use a simple hoe (pacul) to
prepare their land. Hand tractors are rare. Conversely, pesticide spayers are very common.
The use of purchased inputs is ubiquitous, but seven out of ten farming households

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use biocides and fertilizers on a truly regular basis in the cultivation of all their crops. A slightly
smaller share also applies only purchased selected seeds.

Types of crops grown & their marketing

All farmers grow rice; nine out of ten farmers in the village are also involved in the
cultivation of vegetables like shallots (bawang merah) and chilli (cabe). In addition, one out
of three farmers also cultivate crops like maize, groundnuts and soybeans (polowijo), and to
a lesser extent, cassava or other tubers. The annual farming cycle therefore usually consists
of three or four distinct periods. Just at the start of the rainy season, usually for about 100-110
days from November to February rice is grown (musim padi). Subsequently, shallots and chilli
are cultivated partly on the basis of intercropping from March to May and May to August,
respectively (musim bawang merah & musim cabe). By the time the last chillies are harvested
the dry season has started (musim kering), in which a mixture of various not-permanently
irrigated polowijo crops are cultivated, or the land is left fallow. The vegetable growing process
in particular comprises of an extremely high input high output production system. Both
fertilizers and biocides are used intensively and the required labour input per hectare is high.
The ensuing high production costs are, however, usually offset by the prices that are paid on
the market. Due to their volatility, however, the actual profitability of the cultivation of the crops
by the farming households varies strongly. From time to time, even losses are reported.
Virtually all farming households consider the production of rice primarily for subsistence
purposes: less than half of the farm production is sold, or used as payment in kind in return
for agricultural labour or agricultural services rendered. Conversely, nearly all vegetables and
most of the polowijo are marketed. Apart from a relatively small proportion which is directly
sold by the producers at the village market place, such usually occurs via traders or
middlemen. Three types of traders can be distinguished, viz. the market retailers & traders
( pedagang besar), the small village traders ( bakul) and the larger village traders
(penyalur). The latter two are most popular since they inhabit the study village. In contast to
the markets retailers, they often collect the produce at the farm gate which, inspite of the lower
prices paid, is preferred by the farmers who often are without access to adequate means of
transportation. A major share of the horticulture produce is destined for the larger urban
markets and supermarkets, prominently including those situated in Yogyakarta City.

Rural versus agricultural diversification

The person-land ratio has risen to an extreme level. In the early years of the Green
Revolution in the 1970s, some extra hands could be accommodated in agriculture following

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more intensive cultivation practices. However, soon after, the absence of further absorption
capacity of the sector forced increasing contingents of household members to seek refuge in
other activities. Part of these were found in the large employment centres such as the
Metropolitan Area of Jakarta (Jabotabek) - both circular and permanent migration became
common phenomena in the area - or to seek refuge in additional activities in the area, such
as petty trade and the production of Javanese sugar (gula jawa). Mostly these latter activities
were of a marginal nature and purely undertaken as part of a household survival strategy. Due
to the location relatively far away from Yogyakarta City - which does not allow easily for daily
commuting and seems to put it beyond the horizon of the urban-based investors - the growing
importance of non farm economic activities over the last decades has consequently largely
sprung from the typically supply-push processes from agriculture.
This somewhat gloomy picture on the nature of the main driving forces behind the local
rural diversification process appears to be largely characteristic for a district-wide pattern as
found in the areas outside the peri-urban zone of Yogyakarta, in particular for the areas
situated beyond the rural infrastructural nodes or the centres of formal - mostly government-
related - employment opportunities (cf. Huisman & Kragten, 1997; Huisman and Stoffers,
1998).
In the second half of the 1980s, after some rounds of experimentation a few among the
relatively better-endowed farmers in the area decided to embark on the commercial cultivation
of a number of typically high input high output horticultural crops. Chilllies and shallots were
selected as the dominant types. From 1986, their cultivation was technically made possible
by the gradual replacement of simple, traditional earthen-channel irrigation systems by
concrete systems as initiated by the Government Irrigation Office (Dinas Pengairan).
Although the success of these cultivation practices drew much attention in the area, initially
few farmers followed suit. Reportedly, the main obstacles for these farmers to also diversify
their agricultural activities related to a structural lack of capital: for the cultivation of these
crops the investments required per 1000 square metres are up to six times the amounts
required in rice cultivation. Especially the expenses on selected seeds, fertilizer and biocides
needed are responsible for this huge difference in starting costs. In addition, many farmers
realized that their lack of experience with these crops contributed to the already considerable
risks involved in horticulture, which are mainly related to large price fluctuations and the
possible occurrence of pest explosions. However, after the proven success of the starters, a
rapid increase in new adoptors could be observed. An important driving force in this
agricultural diversification process has been the steadily growing demand for the horticultural
products such as chillies and shallots.This is especially due to the vicinity of large urban

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population concentrations with rapidly rising purchasing power (in particular in Yogyakarta),
but also to growing rural demand.
The relatively passive role of the government services in this respect is striking: the
main stimulative force in the sustained spread of innovations was formed by the increasingly
more affluent starters. Also the role of formal credit programmes remained limited. Since most
of the small farmers could not comply with the collateral regulations, they were largely
dependent on private moneylenders. As a consequence, a decade after the introduction of
these crops, i.e. in 1996, over two-thirds of the farming households in the area are actively
engaged in their cultivation of horticultural crops such as chilli and shallots on a regular, fully
commercial basis. Overall, during this period the relative importance of agriculture as main
activity in terms of income generation has grown considerably. This growth has mainly
occurred at the detriment of craft activities, notably the production of Javanese sugar, and,
although less spectacularly, also has had some implications for trade and related activities
and the relative position of other main income sources (cf. table 3). In spite of the rise in the
households= first income opportunities in vegetable production, only 20% of the households
are exclusively engaged in agricultural activities. The rest of the units pursue supplementary
income activities as well.
A closer look at the activities of individuals in the productive age categories reveals the
following pattern: in total half of the working population carries out additional activities. More
than half (56%) of these supplementary activities are carried out outside agriculture in diverse
activities such as trading, Javanese sugar production and construction (mainly as carpenters
and general labourers). The majority of those having secondary incomes from activities
outside farming are primarily engaged as farmers (79%) Only a limited proportion of the
individuals having a secondary income source (9%) are engaged in non-farm employment for
both their primary and supplementary incomes.A considerable part of the remaining share of
the households members with secondary incomes are generating these in agriculture.
Government employees and other fixed income earners frequently supplement their incomes
(often amounting to 100,000 - 200,000 or more monthly) with activities in horticulture. These
regular income sources allow them to take risks. In addition, they are able to timely purchase
yield-optimizing packages of seeds, fertilizers and biocides. In this way, for these persons
their non-farm income sources form a sound basis to venture profitable activities in the
agricultural sector. Others are able to obtain remittances of family members that have
migrated, or enjoy secondary incomes from pensions or the renting out land.

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 Table 3: Main Sources of Household Income 1993 & 1996/97 (in %)

Main Source of Income 1993 1996/97 (n=184)

Agriculture 51 61*)

Crafts and processing 12 5

industry**)

Trade, transport & construction 16 17

Government Employment 8 7

Other (a.o. Pensions, Rents & 13 10

Remittances)

Total 100 100

*) 49% from activities at the own farm and 12% from agricultural labour
**) mainly production of Javanese sugar (gula Jawa)
Source: Statistical Records Local Government Kretek (1993) & Research (1996/97)

The progressing investments in the high input - high output horticultural crops, next to
the intensive cultivation of other food and cash crops, the ensuing positive effects of the
increasing output levels on parts of the local trading sector - such in combination with the
widespread and sustained tapping of other income sources by households and individuals-,
have all resulted in a comparatively dynamic rural economy. Obviously, these dynamics have
profound effects on the level of the household incomes in the area. During the primary data
collection, the average monthly household income in Tirtosari amounted to 244,000 Rp. ( at
the time equivalent to an amount close to 100 U$), considerably above the average household
income in areas with rather similar agro-ecological conditions. The distribution of this income
shows a pattern of considerable differentiation. The share of the relatively well-off households,
- i.e. those whose monthly income exceed 200,000 rupiah - is close to one-third of all units,
which is indicative for the extent socio-economic inequality (cf. table 4).

Table 4: Distribution Monthly Household Income (in Rp* & in %)

Total Monthly Household Income Proportion of Households

< 100,000 28

100,000 - 200,000 31

200,000 - 400,000 20

> 400,000 11

100 (n=184)
*) Exchange rate early 1997: 1 US=Rp. 2600
Source: Research 1996/97

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Labour Dynamics
The agricultural diversification process in Tirtosari is reflected in the changes on the
labour market and the labour arrangements. In turn, these are largely related to the different
labour requirements of the various types of crops, both with regard to the total intensity of the
input and the agricultural labour calendar. The cultivation of horticultural products generates
the highest labour demands, rice cultivation is somewhat less labour intensive, while the so-
called polowijo crops maize, soybeans and groundnuts require comparatively limited labour.
Whereas the patterns of labour utilization of rice and the polowijo are rather similar - i.e.
mainly during land preparation/planting and harvesting a short but high peak demand for
labour occurs -, the cultivation of horticultural produce such as chillies and shallots requires
substantial attention throughout the entire period of cultivation. Since the introduction of
horticulture gained real momentum in the area, the demand for agricultural labour has risen
sharply. In particular during various peak periods local labour shortages necessitate the
mobilization of agricultural labour beyond the village boundaries.
Overall, the use of hired labour varies considerably over the crop types. In the
cultivation of the polowijo family labour (sendiri) is more important in comparison to the other
crops; especially for the transplanting of rice and for the various stages of vegetable
production hired labour is usually applied. Of course, the size of the land area available to the
individual farming households influences the ratio family labour - hired labour input to a large
extent as well: only one out of two farmers with a sawah plot of 1500 square meters or less
uses hired labour on a regular basis, against virtually all farmers with more subtantial land
reources at their disposal.
A closer look at the harvesting arrangements further illustrates the varying degrees of
commercialization of labour over the crops grown. For the harvesting of rice the traditional
system of bawon - either or not mixed with other arrangements - is still common. In this
system, all villagres are allowed to participate in the harvesting process. The harvesters
bundle the stalks of paddy and transport these to the yard where the threshing takes place.
In return for their labour they receive a share of the output. The advantages for the farmer-
owner is related to this payment in kind: cash expenditure is not required to bring in the crop
in time. Increasingly, however, the shortage of able bodied labour availability necessitates that
the bawon harvesters are joined by a number of incidental wage laboureres who are
contracted by the farmer to bring in the harvest. This can be considered as a form of
transition to a fully commercial harvesting arrangement. Specifically for the harvesting of rice,
the application of the tebasan system - whereby the harvesting is arranged by a middleman
(penebas) from outside the area who buys the complete standing crop beforehand and who

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brings his own wage labourers to carry out the harvesting tasks - is rapidly increasing. The
main advantage for the farmer involved is that he or she immediately receives a substantial
sum of cash money which allows him or her to purchase the necessary inputs for vegetable
cultivation straight away, so that no precious time is lost in a possibly tedious process of
obtaining the funds. Obviously, because of the increased incidedence of the tebasan system
(near) landless co-villagers are deprived of direct access to a part of the village rice crop. For
the able bodied who can sell their labour easily such is no problem; however, for the
physically less capable among the villagers who have no access to wage labour opportunities,
such may pose a deterioration of the food security situation.
The contractual wage labour arrangement upah is growing in popularity as well. As a
consequence, the minimun levels of remuneration have gone up considerably of up to two
times the going rates for agricultural labour as observed elsewhere in the central lowland zone
of Bantul. The labourers are either hired per day (harian), or for the whole task which is to be
completed (borongan). Reportedly, in an increasing number of cases, the labourers hired are
originating from nearby villages which allows the employing farmers to maintain a strictly
commercial/business-like relationship with his workers since no direct personal relationship
or even remote family ties exist whatsoever. The relative incidence of harvesting labour
arrangements per crop is shown below (cf. table 5).

Table 5: Labour Arrangements per Type of Crop (in % of farmers cultivating such crop )
Crop/Arrangement Wage Labour 1) Family Labour 2) Other Forms

Rice 20 27 53*)

Polowijo (mainly maize,

soybeans & 65 30 5**)
groundnuts)

Vegetables (mainly
shallots & chilli) 76 19 4**)
1) = upah; 2= sendiri
*) mainly via customary sharecropping arrangements (bawon)
**) mainly mixed forms
Source: Research 1996/97

In sum, an increasing commercialization in crop cultivation has impacted considerably

on the nature of the labour arrangements and, therefore, on the village living conditions and
the fabric of the society. Especially in harvesting practices, >new= capitalist-oriented labour
arrangements have gained in popularity. Following the transformation of the rural labour
market the employment and income position of the households has polarized to some extent.
Social security mechanisms have been progressively eroded and the position of certain
vulnerable groups has deteriorated whereas those capable to exploit the rising employment

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opportunities in agriculture have been able to strenghten their position considerably. In
particular the preference of farmer-employers for contracting labour outside their communities,
so that business-like relations can be maintained, have changed the nature of the rural
society. The higher and less seasonally-determined labour demand in the new farming system
has also affected the incidence of supplementary non-agricultural income activities. Especially
the activities which usually offer a comparatively lower return to labour time input, such as for
instance the home-based production of gula jawa, have been affected.

Sustainability of practices
In fact horticulture is not a simple diversification in cropping pattern, rather it constitutes
a further step in the intensification of the cultivation of very high input - very high output cash
crops. Commercial vegetable growing as practiced in the area is characterized by an intensive
use of fertilizers and biocides, especially pesticides. From numerous interviews among the
cultivators, it has appeared that they mostly are under the impression that the more fertilizers
and pesticides are applied, the more optimal the yield levels will become. They seem to
undervalue the necessary balance of nutrients and disregard the need to keep the pollution
of water and soil as limited as possible.
Of course, the farmers as such are not to blame for these ideas. As elsewhere in
Indonesia, in the past the application of fertilizers and biocides, in particular pesticides, was
encouraged by the substantial government susbsidies on these products in context of the
Green Revolution policy-packages (Ferrari 1994 pp. 17 - 22). This stimulation policy has led
to overuse, such as the practice of frequent spraying as a form of insurance, although the
benefits in terms of increased yields have remained doubtful. The farmers= misconceptions
are a legacy of years of widespread promotion of agricultural extension agents who did not
pay heed to the various risks of the chemicals. Especially following a number of highly critical
comments from the World Bank staff and from other agricultural government policy analysts,
in recent years throughout Indonesia, the retail price of these products has been revised
upwards. Obviously, this may be expected to stimulate a lower and possibly more balanced
use of these inputs, which is one of the necessary pre-conditions to attain a longer term
sustainability of the production system. Already, the often somewhat haphazard and intensive
use of pesticides implies that pests are increasingly difficult to control. Indications are present
that the so-called > pesticide treadmill > has been set in motion, i.e. the proportion of crop loss
from pest damage has not declined inspite of the increasing pesticide dosages and the
frequency of spraying. Most likely, the immunity of crops to pest attacks has been
compromised, various pests may have developed resistance which curbs the effectiveness

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of the chemicals, and the various natural pest predators have been progressively eliminated.
The farmers thus have become trapped in the cycle of reliance on chemicals. These
chemicals= toxic effects are doing damage to soil and water organisms and also ground water
resources become increasingly contaminated. According to hydrological experts from the
Gadjah Mada University Faculty of Geography, in particular in this area the latter aspect
poses an extra risk due to the local shallowness of the fresh groundwater sources, following
the location of the site close to the Indian Ocean (personal communication). The direct health
threat forms a serious problem as a consequence of this geographical factor.
These developments call for a much more active role of the government to stop this
process. Well-designed and carefully implemented policy interventions are indispensable.
These interventions should not be limited to curative measures, but ought to specifically focus
on the preventive sphere. Adequate extension services and systems of information provision
to all small farmers, careful monitoring of biocide usage and the development of other pest
control systems are needed most. Applied research has made clear that various alternative
systems exist to the exclusive reliance on pesticides. The systems developed on the basis of
the experiences offered by the rice-cultivation oriented Integrated Pest Management (IPM),
for instance, could offer a good starting point. Central to the IPM - which has also succesfully
been applied in Indonesia - is the reduction of crop damage to tolerable levels by means of
control measures whose ecological and financial costs are acceptable. Crop rotation, the use
of so-called trap crops, intercropping, pest scouting and remedial intervention, and biological
control, among others, are potentially also powerful methods in horticulture. As often the case
when dealing with environmental issues, the various government departments cannot transfer
the responsibility to curb pesticide use and the development of more sustainable practices to
the workings of the market mechanisms. Apart from applied research and technical services
provision, in particular farmer outreach and training are required which calls for a massive
effort.
In summary, the case study has shown that in Tirtosari, in contrast to many other
village areas in the lowland zone of Bantul, usually agriculture is not a sideline activity to most
households, but a primary source of employment. To some well-off households with fixed
sources of income, it does form an important and often lucrative way of generating extra-
income. Our example clearly indicates that agricultural diversification under certain contextual
conditions can constitute a viable alternative in situ to an engagement in rural non farm
activities. In view of the quantitave information on the change in composition of main income
sources on Tirtosari, the label of local re-agrarianization is justified to characterize the process
of increase in employment and income opportunities in agriculture. Nevertheless, due to its

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positive demand-pull effects on other sectors such as trade and transport - which in turn may
also bring about a substantial increase of the spill-over effects in other non farm activities such
as agro-based processing- this label could very well prove to be rather short lived only. In
addition, the environmental unsustainability of the present-day cultivation practices
necessitates a thorough transformation of the farming system.

Observations on the impact of the current crisis on the rural economy

In the second half of 1997, i.e. just after primary data collection for this study was
completed, the Indonesian version of the Asian economic crisis (often labeled as Krismon -
krisis moneter: after monetary crisis) gained momentum. Since then, the national currency has
depreciated in value with over 300%, annual inflation reached levels of 80% and more, and
both the economic output and the formal sector employment opportunities have shrunken in
an unprecedented way. Also the label Kristal (- krisis total: after total crisis) is used to express
that also non-economic factors are at the roots of the crisis. The social and socio-economic
consequences of what has happened have not yet been documented in a detailed way. The
first indications show that the impact of the crisis has been particularly harsh in the financial,
property and automotive sectors of the economy, which all based in the urban areas of the
country (cf. Evans, 1998). At the same time, research results generated by staff members
of the Regional Development Planning Department of Gadjah Mada University=s Geography
Faculty under the leadership of Prof.Dr.A.J.Suhardjo M.A., indicate that the incomes of the
group of agricultural producers as a whole did not suffer from the crisis. Some agricultural
producers have even managed to improve their income situation due to comparatively high
price rises. Dried cassave (gaplek) prices, for instance, have multiplied fivefold since the start
of the crisis (personal communication). However, in the rural rice-growing parts of Java the
effects of the economic crisis are also profound. Mid-1998 the government has removed the
various subsidies on fertilizers and biocides and, although government policy as regards the
strictly controled rice ceiling prices has relaxed somewhat since then as well, especially these
rice farmers have experienced a sharp decline in their terms of trade and their real incomes
(Evans op. cit.).The horticultural sub-sector has not been directly affected by government
policy, and the terms of trade have, reportedly, improved. Nevertheless, since urban demand
has suffered from declining purchasing power and improvement in the terms of trade in this
sub-sector has only partly offset the effects of weakening of this demand, the indirect impact
is also clearly noticeable.

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