Firms’ ICT and Innovation in Jakarta Metropolitan Area

The aim of this study is to analyze the difference in innovations for firms that either do or do not use information and communication technology (ICT). In today’s digital era not all firms using are ICT. It would be interesting to know the difference in innovation performance between companies with and without ICT usage. Data from the last wave of the Enterprise Survey for Indonesia 2015 was analyzed using descriptive statistics and a test of differences using the Chi-Square test. The region of focus for this paper is the Jakarta Metropolitan Area. Jakarta is the current capital city of Indonesia and the second most populous metropolitan area after the Tokyo urban area. The analysis shows that significant differences were observed in both product and process innovations. This study can be beneficial for understanding the role of ICT in firm innovation, especially for firms in metropolitan areas and emerging economies.