Impact of Information and Communication Technology (ICT) Infrastructure on Economic Growth and Income Inequality in Indonesia

Authors

  • Rima Untari  Department of Economics, Faculty of Economics and Management, Bogor Agricultural University (FEM IPB), Bogor Indonesia
  • Dominicus Savio Priyarsono  Department of Economics, Faculty of Economics and Management, Bogor Agricultural University (FEM IPB), Bogor Indonesia
  • Tanti Novianti  Department of Economics, Faculty of Economics and Management, Bogor Agricultural University (FEM IPB), Bogor Indonesia

DOI:

https://doi.org//10.32628/IJSRSET196130

Keywords:

Economic Growth, ICT, Income Inequality, Infrastructure, Simultaneous Equations

Abstract

Information and Communication Technology (ICT) plays an important role in supporting economic growth and overcoming income inequality. ICT infrastructure functions to facilitate the use of ICT by economic actors through ICT devices. Previous research used more data between countries or between districts/cities while Indonesia consisted of provinces with different social and economic characteristics. Therefore, the purpose of this study is to analyze the impact of ICT infrastructure on economic growth and income inequality in Indonesia using provincial panel data for the period 2011-2016. The results of the analysis of simultaneous equation models using the Two Stages Least Square (TSLS) method state that ICT infrastructure indicators consisting of cellular telephone ownership, internet accessibility, and the number of Base Transceiver Station (BTS) significantly has a positive impact on economic growth. In addition, these ICT infrastructure variables indirectly have an impact on income inequality through economic growth. Other results obtained are that government spending on ICTs do not significantly impact economic growth and income inequality in Indonesia. The conclusion is that ICT infrastructure has a direct impact on economic growth and an indirect impact on income inequality.

References

  1. Alleman J, Hunt C, Michaels D, Mueller M, Rappoport P, Taylor R. 2004. Telecommunication and Economic Development:Empirical Evidence from Shouthern Africa. Sidney (AU): International Telecommunication Society.
  2. Badan Pusat Statistik. 2016. Produk Domestik Regional Bruto Provinsi-Provinsi di Indonesia Menurut Lapangan Usaha. Jakarta (ID): BPS.
  3. Badan Pusat Statistik. 2017. Statistik Keuangan Pemerintah Provinsi. Jakarta (ID): BPS.
  4. Baltagi, BH. 2005. Econometric Analysis of Panel Data. New York (US). John Wiley & Sons.
  5. Calderon C, Serven L. 2004. The Effect of Infrastructure Development on Growth and Income Distribution. JEL Classification H54, O54.
  6. Gujarati, DN. 2004. Basic Econometrics: 4rd edition. Singapura (SG): Mc Graw-Hill.
  7. Kementerian Komunikasi dan Informatika. 2018. Available att www.kominfo.go.id.
  8. Mankiw, NG. 2006. Makroekonomi. Edisi ke-6. Jakarta (ID): Erlangga.
  9. Mefteh H, Benhassen L. 2015. Impact of information and communication on economic growth. International Journal of Economics, Finance and Management. 4(2):90-98.
  10. Naym J, Hossain MA. 2016. Does Investment in Information and Communication Technology Lead to Higher Economic Growth: Evidence from Bangladesh. International Journal of Business and Management. 11(6):301-312.
  11. Ngatono. 2016. Pengaruh Infrastruktur Telekomunikasi terhadap Pertumbuhan Ekonomi di Provinsi Banten, 2004-2013. Jurnal Prosisko. 3(1):33-42.
  12. Prasetyo, BA. 2013. Dampak Pembangunan Infrastruktur terhadap Pertumbuhan Ekonomi dan Ketimpangan di Kawasan Perbatasan Darat Indonesia [tesis]. Bogor (ID): Institut Pertanian Bogor.
  13. Tamara, TI. 2011. Pengaruh infrastruktur telekomunikasi terhadap pertumbuhan ekonomi di Indonesia, 2000-2009 [tesis]. Jakarta (ID): Universitas Indonesia.
  14. Todaro MP, Smith SC. 2004. Pembangunan Ekonomi di Dunia Ketiga. Jakarta (ID): Erlangga.
  15. Vu, KM. 2011. ICT as A Sourceof Economic Growth in the Information Age: Empirical Evidence from the 1996-2005 Period. Telecommunication Policy. 35(357-372).
  16. World Bank. 1994. World Development Report: Infrastructure for Development. New York (US): Oxford University Press.

HTML CSS and JavaScript are the client-side elements of each website. Learn them to become a web developer.

International Journal of Scientific Research in Science, Engineering and Technology

Downloads

Published

2019-01-30

Issue

Volume 6, Issue 1, January-February-2019

Section

Research Articles

License

Copyright (c) IJSRSET

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite

[1]
Rima Untari, Dominicus Savio Priyarsono, Tanti Novianti, " Impact of Information and Communication Technology (ICT) Infrastructure on Economic Growth and Income Inequality in Indonesia, International Journal of Scientific Research in Science, Engineering and Technology(IJSRSET), Print ISSN : 2395-1990, Online ISSN : 2394-4099, Volume 6, Issue 1, pp.109-116, January-February-2019. Available at doi : https://doi.org/10.32628/IJSRSET196130