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Do Information And Communication Technologies Foster Economic Growth In Indonesia?

Author

Listed:
  • Badri Narayan Rath

    (Indian Institute of Technology Hyderabad)

  • Danny Hermawan

    (Bank Indonesia)

Abstract

This paper investigates, using annual data from 1980 to 2014, whether adoption of information and communication technologies (ICT) fosters economic growth in Indonesia. We employ an Autoregressive Distributed Lag cointegration technique on an augmented neoclassical growth model. The empirical results indicate a positive effect of ICT development on economic growth in both the long-run and short-run. The other regressors, such as total factor productivity, human capital, and capital per worker, also positively affect economic growth. From a policy perspective, the Indonesian government should promote ICT development through greater investment.

Suggested Citation

  • Badri Narayan Rath & Danny Hermawan, 2019. "Do Information And Communication Technologies Foster Economic Growth In Indonesia?," Bulletin of Monetary Economics and Banking, Bank Indonesia, vol. 22(1), pages 103-122, April.
    • Handle: RePEc:idn:journl:v:22:y:2019:i:1f:p:103-122
    DOI: https://doi.org/10.21098/bemp.v22i1.1041
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    More about this item

    Keywords

    ICT development; Economic Growth; ICT Exports; ARDL Bound Test; Indonesia;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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