ICT Adoption, Innovation, and Labor Productivity in ASEAN: Evidence from Panel Data Analysis
DOI:
https://doi.org/10.63954/WAJSS.4.2.2.2025Keywords:
ICT adoption, innovation, labor productivity, ASEAN economies, panel data analysis, JEL Code: O33, O47, F21, C23Abstract
Why do stark productivity disparities persist in ASEAN despite rapid digitalization? This study investigates the divergent drivers of labour productivity in the advanced ASEAN-6 and the catching-up ASEAN-10 from 2000–2023. Employing dynamic panel models, we demonstrate a fundamental dichotomy. In ASEAN-10, basic internet access and foreign direct investment (FDI) are the primary catalysts, enabling catch-up growth. Conversely, in the more developed ASEAN-6, productivity is driven by frontier innovation - specifically, patentable outputs and long-term R&D - while broad digital expansion yields diminishing returns. Critically, we identify an innovation - productivity paradox: composite innovation inputs show negative returns, whereas tangible patent applications consistently enhance productivity. The findings prescribe a bifurcated policy approach: ASEAN-10 must focus on technology diffusion and strengthening intellectual property, while ASEAN-6 should prioritize mission-oriented R&D and enhancing the commercialization ecosystem to escape the middle-income trap.
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Copyright (c) 2025 Tidiane Guindo, Harjito

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