<mark>more intensively. These skills, on the other hand, are less important for administrative and managerial workers, professionals and technicians, and clerical workers.</mark> Third, we use information from the National Socio-Economic Survey (Susenas) to generate technology adoption variables at the province level. The survey was conducted bi-annually over the period analyzed in this paper (in March and July) and we combine the March wave for years 2005 and 2006 with the July wave for 2007 onwards, these being the only waves representative at the province level in each year. The Susenas collects information on technology adoption at the household level, which we aggregate to obtain technology indicators at the province level. Using this survey, we construct the share of households having a computer in each province and year, which we use as a technology adoption variable in our econometric analysis.

Finally, measurements of trade in goods are taken from the UN Comtrade database from 2005 to 2015. We calculate the annual value of Indonesian exports at the industry level in constant 2010 U.S. dollars and the global demand for each industrial product (excluding Indonesian products) that we use as an instrumental variable. We match the industrial classification available in the UN Comtrade database (Harmonized Commodity Description and Coding System HS1) for the period under analysis with the classification of industries in the Sakernas survey (KBLI 2000, 2005, and 2009), resulting in a mapping to 22 tradable industries.

# **4. Descriptive Statistics**

Indonesia is in an early stage of digitization. ICT infrastructure is still weak, but the country has been increasing the rate of ICT use over time. Panel A of Table 2 provides some descriptive statistics on ICT adoption at the household level across the 33 provinces of the country. The percentage of households owning a cellphone more than tripled between 2005 and 2010 (from 20.3% to 71.6%) and continued to increase between 2011 and 2015, although at a slower pace (from 75.7% to 86.0%). Only 3.5% of households had at least one computer at home in 2005, but this ratio had jumped to 11.2% by 2010 and to 20.1% by 2015. Only 3.2% of households were connected to the internet in 2005, but the share had reached 22.6% in 2010 and 33.3% by 2015. The rise in computer use over this period is shown in Figure 1, where the distribution of the share of households with a computer moved to the right every year –the 25th and 75th percentiles were higher every consecutive year. The spread of the distribution grew, indicating an increase in the variation across provinces of the computer use measure.

Moving to the trade dimension of the data, starting in 2004 Indonesia reduced trade restrictions and engaged in several multilateral, regional, and bilateral trade negotiations (Pangestu et al., 2015). A commodity boom led to a substantial growth in exports between 2005 and 2010. The total value of exports increased by 65.0% over this sub-period, with a slowdown in 2009 as a result of the international crisis (Panel A of Figure 2). Manufacturing products other than food accounted for the largest share of exports, followed by mining. However, exports of manufactures increased 48.2% over 2005-2010, while mining exports increased 80.0%. On the other hand, the collapse of commodity prices over 2011-2015 led to a fall in the value of exports by 29.9%; mining was the most affected industrial group, with a reduction of 52.6% (Panel B of Figure 2). As a result, the share of manufactures in total exports rose, while the share of mining products fell.

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