{"title":"The Impact of Special Economic Zones and Government Intervention on Firm Productivity: The Case of Batam, Indonesia","authors":"A. Aritenang, Aryani N. Chandramidi","doi":"10.1080/00074918.2019.1643005","DOIUrl":null,"url":null,"abstract":"Various studies have explored the effects of industrial agglomeration and special economic zones (SEZs) in Asia, but there has been a lack of data-driven analysis of SEZ performance. This paper provides a case study on Batam, which has been developed as an SEZ through government-to-government (G2G) cooperation, offering lessons for other developing countries. The study examines the effects of industrial zones, foreign investment and government intervention on firm productivity, using an ex-post evaluation method and econometric models. The paper does not find conclusive evidence that Batam’s status as an SEZ affects firm productivity and growth. Although firm agglomeration proves beneficial for firm productivity, it is not clear that SEZ policy has driven this productivity. The paper argues that government policies should stimulate innovation and inter-firm cooperation to increase knowledge spillovers and technology transfer instead of focusing on attracting investment.","PeriodicalId":46063,"journal":{"name":"Bulletin of Indonesian Economic Studies","volume":"56 1","pages":"225 - 249"},"PeriodicalIF":2.0000,"publicationDate":"2020-05-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"https://sci-hub-pdf.com/10.1080/00074918.2019.1643005","citationCount":"18","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Bulletin of Indonesian Economic Studies","FirstCategoryId":"96","ListUrlMain":"https://doi.org/10.1080/00074918.2019.1643005","RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q1","JCRName":"AREA STUDIES","Score":null,"Total":0}
引用次数: 18
Abstract
Various studies have explored the effects of industrial agglomeration and special economic zones (SEZs) in Asia, but there has been a lack of data-driven analysis of SEZ performance. This paper provides a case study on Batam, which has been developed as an SEZ through government-to-government (G2G) cooperation, offering lessons for other developing countries. The study examines the effects of industrial zones, foreign investment and government intervention on firm productivity, using an ex-post evaluation method and econometric models. The paper does not find conclusive evidence that Batam’s status as an SEZ affects firm productivity and growth. Although firm agglomeration proves beneficial for firm productivity, it is not clear that SEZ policy has driven this productivity. The paper argues that government policies should stimulate innovation and inter-firm cooperation to increase knowledge spillovers and technology transfer instead of focusing on attracting investment.
期刊介绍：
The Bulletin of Indonesian Economic Studies, a peer-reviewed journal published by the Indonesia Project at The Australian National University"s College of Asia and the Pacific, fills a significant void by providing a well respected outlet for high-quality research on any and all matters pertaining to the Indonesian economy, and touching on closely related fields such as law, the environment, government and politics, demography, education and health. In doing so, it has played an important role in helping the world, and Indonesians themselves, to understand Indonesia.
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