Social capital, R&D and provincial growth in Indonesia

Solikin M. Juhro, Paresh Kumar Narayan, Bernard Njindan Iyke, Budi Trisnanto

Research output: Contribution to journalArticleResearchpeer-review

Abstract

We propose and test the hypothesis that social capital is an important determinant of total factor productivity (TFP) growth. Using a new historical dataset on 33 Indonesian provinces covering the period 2010–18, we show that social capital enhances growth through research and development (R&D) expenditure. Our analysis is based on a modified endogenous growth model, and the estimations reveal that a unit standard deviation improvement in aggregate, tangible and intangible social capital, and religiosity improves TFP growth by at least 9.80% (of the mean TFP growth) through R&D spending. These results are robust.

Original languageEnglish
Number of pages16
JournalRegional Studies
DOIs
Publication statusAccepted/In press - 2022

Keywords

  • Indonesia
  • research and development expenditure
  • social capital
  • total factor productivity growth

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