Extending the IBCDE framework to explore barriers and drivers in Indonesia's digital economy

Abstract

This study extends the IBCDE framework to explore the multifaceted barriers and drivers shaping the digital economy (DE), with a specific focus on Indonesia as Southeast Asia’s largest and most dynamic digital market. Traditionally, the IBCDE framework encompasses five interrelated dimensions: Infrastructure, Business platforms, Consumer interfaces, Data ecosystems, and Economic context. However, this paper introduces Regulation as a sixth, standalone dimension—grounded in institutional and governance theory—to address a critical gap in existing digital economy scholarship. Regulation is not merely a cross-cutting theme but a structuring force that both enables and constrains the evolution of digital ecosystems. Drawing on a qualitative, multi-stakeholder methodology, the research identifies key structural and behavioral barriers—including fragmented digital infrastructure, platform interoperability challenges, uneven digital literacy, and constrained small and medium enterprises participation. Simultaneously, it surfaces critical enablers such as targeted government incentives, private sector innovation, and adaptive public-private partnerships. The newly integrated Regulation dimension captures how legal clarity, policy coherence, and institutional capacity critically shape all other IBCDE domains—ranging from spectrum licensing and platform competition to data sovereignty and cross-border digital trade. By reconceptualizing regulation as a core pillar of digital economy analysis, this study not only advances the theoretical architecture of the IBCDE model but also delivers actionable insights for inclusive, policy-aligned digital transformation. The extended framework enhances analytical precision for future DE research and provides a roadmap for policymakers to design balanced, context-sensitive interventions that promote sustainable digital growth in developing economies.