Value Chain Connectivity in Indonesia

The Evolution of Unbundlings

Bibliographic Data

ID8415740
AuthorsFukunari Kimura (0000-0002-9834-3153, Keio University), Lurong Chen (Association of Southeast Asian Nations)
Year2018
Volume54
Issue2
Pages165-192
Publication date2018-05-04
Peer ReviewedYes
Open AccessNo
TypeARTICLE
VenueBulletin of Indonesian Economic Studies (JOURNAL)
Journal identifiersISSN: 0007-4918 • E-ISSN: 1472-7234
PublisherInforma UK Limited (PUBLISHER • GB)
DOI10.1080/00074918.2018.1505412
OpenAlexW2894263345
LanguageEN
Citations received1
References cited16

This paper applies the conceptual framework of ‘unbundling’, proposed by Baldwin (2016), to assess the value chain connectivity in Indonesia. Indonesia is a geographically large country, and three different levels of unbundling co-exist. The first unbundling aligns with the industry-wise international division of labour in plantation agriculture, mining, and labour-intensive industries; the second aligns with where the task-wise international division of labour dominates mainly in machinery industries; and the third aligns with where face-to-face costs are reduced by the digital economy. We argue that the further upgrading of unbundling and the more effective use of advanced piecemeal technologies among different levels of unbundling will enable Indonesia to achieve rapid and equitable economic development. Overcoming distance is key for effectively using the mechanics of unbundling. We propose that three key elements are be promoted: enhancement of connectivity, development of the service sector, and improvement of the policy environment

Business · Deregulation · Economics · Industrial organization · Key (lock) · Market economy · Service (business) · Unbundling · Value (mathematics) · Computer Science · Global trade and economics · Global trade, sustainability, and social impact · International Business and FDI · Marketing

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