The Role of the Information and Communication Technology Sector in the Indonesian Economy
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Abstract
The contribution of ICTs to the overall production system in the economy is considered as one of the factors for growth and development of the national economy. The purpose of this research is to investigate the contribution of the ICT sectors to the Indonesian economy through the role of the ICT sectors in encouraging the growth of other sectors with linkage analysis, multiplier analysis and causative matrix analysis. Furthermore, this study investigates the sources of growth in the ICT sectors by decomposing the sources of change in its output. In particular, the input-output approach is adopted to describe the production activities and diffusion of the ICT sectors in the Indonesian economy for the period 2000-2014. The results show that apart from having large output multipliers, the ICT Manufacturing sector also encourages exports. The results of the decomposition show that the influence of the previous technology coefficient has a significant contribution to the output of the ICT sectors. However, these values have diminished in recent periods so that the role of the Indonesian ICT sectors as a GPT sector has become less than optimal.
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