TECHNOLOGICAL PROGRESS AND ECONOMIC GROWTH IN INDONESIA: AREGIONAL
PERSPECTIVE
This paper examined the relationship between technological progress, measured by TFP growth, and
economic growth, measured by GDP growth, both at national and regional levels experienced by
Indonesia. Spatially, Indonesiawas disaggregated into 6 groups of Island: Sumatera, Java,
Kalimantan, Sulawesi, Nusa Tenggara dan Maluku-Papua. Coefficients of correlation were
calculated using simple regression model. Data resulted from a study at the Agency for the
Assessment and Application of Technology of the Government of Indonesia, 1984-2010, were used
for this study. The results showed that both at national level as well as at regional level the
correlation between technological progress and economic growth was positive and very strong.It is
then suggested that programs of technology development should continually be pushed in order to
maintain sustainable economic growth.