Value Chain Approaches in a Stagnant Industry: The Case of Furniture Production in Jepara, Indonesia

This article assesses impacts of the Jepara Furniture Value Chain project, which was intended to address challenges faced by small-scale furniture producers in Jepara, Indonesia. The assessment focuses on effects of membership in the APKJ, an association started as part of the project. Propensity score matching was used to compare differences in outcome variables for association members and matched non-members. A limited, positive impact of APKJ membership was found. Members have improved their marketing behaviors in ways that will allow them to retain more value compared to non-members. APKJ members are also more likely to have obtained certificates of timber legality. Membership in the APKJ does not have a significant effect on firm profit and there is little evidence of an industry transformation. The paper also provides a critique of indiscriminate use of a value chain approach.