The Effect of ICT on Economic Growth: Empirical Evidence from Indonesia 2017-2022
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In the current digital era, technology plays a crucial role in driving economic growth. Rapid advancements have significantly impacted economic activity. This study aims to analyze the effect of Information and Communication Technology (ICT) on economic growth in Indonesia using panel data from 34 provinces during the period 2017-2022. In this research, ICT is measured through the sub-indices of access and infrastructure, usage, and skills. The method used is panel data regression using a fixed effects model (FEM), with adjustments for robust standard errors. The estimation results indicate that ICT has a positive and significant effect on economic growth. Physical capital has a positive effect, whereas depreciation and population growth negatively affect economic growth. Both variables were statistically significant and aligned with economic theory. While all three ICT sub-indices contribute positively, their impact remains smaller than that of physical capital growth.
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