Open AccessThe Effect of Inward Foreign Direct Investment and Information and Communication Technology on Economic Growth in Indonesia
Author(s) -
Heppi Millia,
Pasrun Adam,
Abd Azis Muthalib,
Tajuddin Tajuddin,
Yuwanda Purnamasari Pasrun
Publication year - 2022
Publication title -
agris on-line papers in economics and informatics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.245
H-Index - 16
ISSN - 1804-1930
DOI - 10.7160/aol.2022.140106
Subject(s) - foreign direct investment , distributed lag , indonesian , term (time) , indirect effect , investment (military) , economics , lag , monetary economics , international economics , business , econometrics , macroeconomics , computer science , computer network , linguistics , philosophy , physics , quantum mechanics , politics , political science , law
Inward foreign direct investment indirectly or directly affect economic growth through various means. For instance, the direct effect might be attributed to production factors, while information and communication technology changes are linked to the indirect effect. This study aimed to examine the impact of direct and indirect inward foreign investment and information and communication technology on Indonesian economic growth. The data was collected from the annual time series from 1994 to 2019. Furthermore, an autoregressive distributed lag model was used to analyze the data and provide accurate conclusions. The results showed that short-term and long-term inward foreign direct investment and information and communication technology significantly affects Indonesian economic growth. In the long term, the direct and indirect effects of inward foreign direct investment are negative and positive, respectively. However, the long-term effect of information and communication technology on economic growth is positive.