Abstract
In this paper, we analyzed the urbanization process in the metropolitan fringe of Indonesia by a microeconomic approach. The probability of farmland conversion in the last 10 years was calculated through modeling farm owner's land-trading and land-use choice behaviors.
Samples were collected in November 2001 by interviewing 160 residents in Ciampea Subdistrict situated in the suburb of Bogor, West Java. The farm conversion model consists of three steps: 1) A farm owner chooses to sell his land, to convert its use, or to maintain farming. 2) The seller chooses to whom his land is sold, either local or non-local people. 3) The buyer decides the use of the purchased land. A multinomial logit model was applied in each step, by which we obtained the following results:
1. A farmland was converted for housing use with 40% probability during the last 10 years.
2. The rate of farmland conversion is primarily influenced by three factors; location of farm, difficulty offarming and living standard.
