Essays on Industrial Development

This dissertation comprises three articles, each exploring distinct yet interconnected aspects of industrial development research. This dissertation investigates key factors influencing rural development and industrialization in Indonesia, firm survival, and the relationship between ownership, productivity, and exports. The first study examines how Information and Communication Technology (ICT) contributes to rural industrialization using village-level survey data from 2018 and 2021. Employing Instrumental Variables (IV) with a 2-Stage Least Squares (2SLS) estimation, the findings reveal a positive correlation between ICT and industrialization. Enhanced cellular networks, internet access, and strong telephone signals support manufacturing growth, industrial community formation, and a shift toward industrial-sector employment. ICT also improves rural welfare by reducing poverty and reliance on overseas migrant work. The second study explores firm survival in Indonesia's medium and large manufacturing sectors using firm-level census data from 1995 to 2015. Employing Poisson regression and the Cox proportional hazard model, it finds that firm efficiency is critical for survival. Technological proficiency lowers exit rates, increases firm longevity, and enhances market retention. The study underscores the necessity of efficiency-driven policies for sustaining Indonesia’s manufacturing enterprises. The third study investigates the dynamic relationship between firm ownership, productivity, and exports using firm-level data from medium and large manufacturing censuses, published by BPS from 1995-2015. Using a panel VAR model, results show that foreign ownership significantly boosts productivity and exports, while domestic ownership does not significantly influence productivity. Both foreign and domestic firms contribute to global trade, highlighting the importance of export-driven policies and foreign investment. The study suggests that industrial policies should focus on enhancing productivity, promoting exports, and attracting foreign capital to strengthen Indonesia's manufacturing sector.

Name dc:type.qualificationname

phd

Level dc:type.qualificationlevel

doctoral

Grantor dc:publisher.institution

Budapesti Corvinus Egyetem

Year dc:date.issued

2025

Author dc:creator

• Afin, Rifai

• Ipar

Language dc:language

en