Iswardono S. Permono(1*)

(1) Universitas Gadjah Mada
(*) Corresponding Author


This paper examines the communal economy development in Indonesia by
reviewing several related literatures developed by George and Shorey (1978), Wijaya (1987), Ranuwihardjo (1999), and Baswir (1999). This issue emanates since an ambiguous and pessimistic question still remains regarding what, why, how, what
purpose, and for whom the communal economy is aimed to; nevertheless, economists agree that the issue only ends up as a political commodity in order to draw attention from civilians in the 1999 General Election in the country. Further, the literatures reviewed by the author suggest that there is no need to formulate a brand-new concept; rather, the issue should be covered only by empowering the concept of welfare economics as an analysis tool at the micro level. In vrder to establish this thought, the welfare economics should employ the Pareto Optimality (PO), of which prerequisites are: (1) The economy is in its production frontier, or it reaches its production efficiency, (2) Consumers is at their contract curve, or their consumption efficiency are established, (3) Technically, the slope of the preference curve at its contract-curve should equal with the slope of the production-frontier at certain point that represents a particular number of goods produced, or mathematically is represented by the following equation: MRSxy = MRTSxy. This paper concludes that today the communal economy still remains as a political jargon; however, a more important step is to establish triple-togetherness: co-ownership, co-determination, and co-responsibility.

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K.D. George & John Shorey, The Allocation of Resources: theory and policy, George Allen & Unwin, London 1978.

Faried Wijaya, Pengantar Ekonomi, Femosa, Yogyakarta, 1987.

Sukadji Ranuwihardjo, Beberapa Catalan tentang Ekonomi Kerakyatan, unpublished, 1999.

Revrisond Baswir, Agenda Ekonomi Kerakyatan, unpublished, 1999.

Samuelson & Nordhaus, Economics, 15 th edition, McGraw-Hill, New York, 1995. Yogya Post, 20 Maret 1999.

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