Determinants of Information and Communication Technology Sector Development in Java Island, 2016-2020

Abstract

The Information and Communication Technology (ICT) sector is one of the main drivers of economic growth, so the condition of the ICT sector becomes an essential factor in development. The ICT sector consists of the manufacturing and service sectors whose main activities are related to the development, production, commercial and intensive use of ICT. In 2016-2020, six provinces on Pulau Jawa became the provinces with the highest IP-ICT scores. Pulau Jawa had a GDP share of 59 percent of Indonesia's GDP in 2020. Meanwhile, the ICT sector's GDP share of Indonesia's total GDP was 4.25 percent in 2020. This study aims to analyze factors that affect the development of the ICT sector in Pulau Jawa, 2016-2020. The data used is secondary data from Statistics Indonesia. Using the panel data regression, the results show that the number of workers in the ICT sector, the average length of schooling, and internet users had a significant and positive effect on the development of the ICT sector in Pulau Jawa in 2016-2020. The level of household consumption for telecommunications has no significant impact on ICT sector development in Pulau Jawa in 2016-2020. The results of this study can be used as an example for other provinces to increase the role of ICT in regional economic growth

Analysis of the Effect of Technology on the Growth of the Information and Communication Sector in the Bali Province 2016-2021

“…Apart from that, the average expenditure on ICT in Bali Province is quite low, ranging between 123 -172 thousand rupiah from 2016 to 2021. Following the research of Dharmawan [6] and Triana [11] which concluded that the consumption behavior shown through the average consumption for ICT does not show a significant difference so that the average household consumption for ICT is unable to explain the diversity of GRDP ICT sector. This result is also in concert with research conducted by Martaningsih and Marhaeni (in [21]) which shows that household consumption expenditure has no effect on economic growth in the districts/cities of the Bali Province.…”

“…Research by Dharmawan (in [6]) shows that the percentage of the population who own cell phones has proven to affect the growth of the ICT sector in Indonesia. Meanwhile, Triana's research (in [11]) shows that the growth of the ICT sector is influenced by the number of workers in the ICT sector, the average length of schooling, and internet usage. Consequently, ICT plays an important role as a vehicle for economic growth [12].…”