The Role of Digital Entrepreneurship and Cooperatives in Reducing Open Unemployment in Indonesia
https://doi.org/10.56225/finbe.v4i1.442
Keywords:
Digital entrepreneurship, Cooperatives, Open unemployment, Panel data approachAbstract
Despite positive economic growth trends over the past decade, open unemployment remains one of the main challenges in Indonesia's economic development. The rapid pace of digital transformation presents new opportunities for job creation through digital entrepreneurship. At the same time, cooperatives have long been recognized as grassroots economic institutions with the potential to stimulate the real sector. However, the contributions of both to reducing open unemployment remain debated and have received relatively little attention in empirical studies. This study aims to fill this literature gap by analyzing the influence of digital entrepreneurship and cooperatives on open unemployment in Indonesia during the 2019–2023 period. The study employs panel data regression, with digital entrepreneurship and cooperatives as independent variables and the open unemployment rate as the dependent variable. The results show that digital entrepreneurship has a significantly negative impact on open unemployment, indicating that as digital entrepreneurial activity increases, the unemployment rate decreases. In contrast, cooperatives do not substantially impact unemployment, highlighting the need to revitalize the role of cooperatives in responding to the dynamics of the digital economy. Nevertheless, when considered simultaneously, digital entrepreneurship and cooperatives have a substantial combined effect on open unemployment. These findings underscore the importance of policy support in strengthening digital entrepreneurship through access to financing, training, and infrastructure, while encouraging the modernization of cooperatives to better align with labor market needs. The study recommends that future research incorporate additional macroeconomic variables and extend the observation period to achieve a more comprehensive understanding of the topic.
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