Small business in Indonesia

Asia has combined sustained economic growth with rapid social change.

In the context of this change, small family businesses have continued to prosper and grow in number.

For Indonesia, Southeast Asia's largest economy, the growth is crucial for absorbing the annual increase of 2.4 million new job seekers.

This work seeks to explain the rapid growth of small family businesses in Indonesia.

It develops an alternative analytical framework, departing from past models of the informal sector and petty commodity production, and similarly dismisses recent attempts to apply Western theories of flexible specialization to the Third World.

Instead, emphasis is placed on the internal family stucture of small businesses and its industrial organization in geographically specific clusters of similar businesses.

By investigating in detail small family garment and wood furniture businesses in Greater Jakarta, the issue of their industrial organization is explored in a specific geographical and historical context.

The investigation reveals the importance of the family and its linkages to similar small businesses located in the surrounding area.