A Study on the Influence of ICT Access on Poverty Reduction in Indonesia
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The development of ICT has reduced poverty in both developed and developing countries for several decades. Indonesia has consistently sought to achieve economic growth and alleviate poverty through ongoing investment in ICT and the telecommunication infrastructure, which accelerates digital transformation. In this context, the aim of this study is to examine the influence of ICT access on poverty reduction in Indonesia, using data from 1984 to 2023. The empirical results of this study demonstrate that ICT access has played a critical role in reducing the poverty rate in Indonesia. First, ICT access, proxied by mobile cellular subscriptions, has a positive and significant effect on poverty reduction. Second, an increase in GDP per capita plays a crucial role in alleviating the poverty rate as well. On the other hand, it turns out that financial development and the inflation rate have no positive effects on poverty reduction. Ultimately, the study provides clear evidence that ICT access and GDP per capita have a very significant impact on reducing the poverty rate in Indonesia. Therefore, the findings of this study suggest that Indonesia needs to continue investing in infrastructure and implementing fiscal policies to reduce poverty in the future.
Abstract
The development of ICT has reduced poverty in both developed and developing countries for several decades. Indonesia has consistently sought to achieve economic growth and alleviate poverty through ongoing investment in ICT and the telecommunication infrastructure, which accelerates digital transformation. In this context, the aim of this study is to examine the influence of ICT access on poverty reduction in Indonesia, using data from 1984 to 2023. The empirical results of this study demonstrate that ICT access has played a critical role in reducing the poverty rate in Indonesia. First, ICT access, proxied by mobile cellular subscriptions, has a positive and significant effect on poverty reduction. Second, an increase in GDP per capita plays a crucial role in alleviating the poverty rate as well. On the other hand, it turns out that financial development and the inflation rate have no positive effects on poverty reduction. Ultimately, the study provides clear evidence that ICT access and GDP per capita have a very significant impact on reducing the poverty rate in Indonesia. Therefore, the findings of this study suggest that Indonesia needs to continue investing in infrastructure and implementing fiscal policies to reduce poverty in the future.