THE IMPACTS OF TECHNOLOGICAL PROGRESS ON HUMAN
DEVELOPMENT: EVIDENCE FROM INDONESIA
Muchdie, Muchdie
The research reported in this paper aimed to analyse the impacts of technological progress on
human development, directly and indirectly, using Indonesian data 2004-2013. This period of
investigation coincided with the two periods of Yudhoyono adminstration. Technological
progress was mesured by Total Factor Productivity growth (%), Economic growth was
measured by GDP growth (%), Poverty reduction was measured by percentage of poor people
(%), and Human development was measured by human development index. Except data on
total factor productivity growth, all data were collected from National Statistic Agency.A
path model analysis was empolyed to examine direct and indirect impacts. There were four
paths (Path-1 to Path-4) to be analysed. Four hypothesis had been tested.The results showed
that the impact of technological progress on human development varied depend on the path.
Firstly, on Path-1, technological progress had direct negative impact on human development.
This direct impact was statistically significant. Secondly, on Path-2,technological progress
indirectly had negative impact on human development, through poverty reduction. This
indirect impact was statistically significant. Thirdly, on Path-3,technological progress had
positive impact on human development, through poverty reduction and economic growth.
This indirect impact was statistically significant. Finally, on Path-4, technological progress
indirectly had positive impact on human development, through economic development.
The research reported in this paper aimed to analyse the impacts of technological progress on
human development, directly and indirectly, using Indonesian data 2004-2013. This period of
investigation coincided with the two periods of Yudhoyono adminstration. Technological
progress was mesured by Total Factor Productivity growth (%), Economic growth was
measured by GDP growth (%), Poverty reduction was measured by percentage of poor people
(%), and Human development was measured by human development index. Except data on
total factor productivity growth, all data were collected from National Statistic Agency.A
path model analysis was empolyed to examine direct and indirect impacts. There were four
paths (Path-1 to Path-4) to be analysed. Four hypothesis had been tested.The results showed
that the impact of technological progress on human development varied depend on the path.
Firstly, on Path-1, technological progress had direct negative impact on human development.
This direct impact was statistically significant. Secondly, on Path-2,technological progress
indirectly had negative impact on human development, through poverty reduction. This
indirect impact was statistically significant. Thirdly, on Path-3,technological progress had
positive impact on human development, through poverty reduction and economic growth.
This indirect impact was statistically significant. Finally, on Path-4, technological progress
indirectly had positive impact on human development, through economic development.