According to Law No. 7 of 1996 that
According to Law No. 7 of 1996 that regulates food (Government of the Republic of Indonesia, 1996), the food is anything that comes from biological sources and water, whether treated or untreated, which are intended as food or drink for human consumption, including food additives, food raw materials, and other materials used in the preparation, processing, and or manufacture of food or drink. As it relates to food price policy, and not all food commodities involve the government in the form of food price policies not all food commodities will be analyzed. For that use of major food groups that are related to food price policy program.
2.2 Food Price Policy
One purpose of the policy is to stabilize agricultural prices agricultural prices in order to reduce the uncertainty of farming, and ensure stable food prices for consumers and price stability at the macro level. Goes on to say, agricultural price policy can be done through a variety of instruments, namely trade policy, exchange rate policy, taxes and subsidies, as well as direct intervention. Indirectly price stabilization can also be done through marketing policy output and policy input. Policy in the form of subsidized inputs such as inputs prices imposed by the government on fertilizer, seeds, pesticides, and credit. Based on the cause, policy or price stabilization price stabilization can be done by food price policy, ie the policy base price (floor price) and the policy of the highest price (ceiling price). This policy led to an imbalance of the market so that the necessary supporting policies, which do stock or export policy as stipulated base price and the current market operations roof pricing policy set. Of the various forms of the existing policy, the concept kebijakann prices used in this study is the input-output price policy that consists of input price subsidies, credit subsidies input procurement, procurement of food subsidies, and subsidized food procurement credit. Measure used is the number of funds (billions of dollars) are used by the government to implement the policy.