The Impact of Governance and Digital Competitiveness on Agriculture Sectors Amid Global Uncertainty

ErnawatiMuhammad SyarifMansyur Asri

DOI 10.7160/aol.2025.170204
No 2/2025, June
pp. 51-62

Ernawati, Syarif, M. and Asri, M. (2025) "The Impact of Governance and Digital Competitiveness on Agriculture Sectors Amid Global Uncertainty", AGRIS on-line Papers in Economics and Informatics, Vol. 17, No. 2, pp. 51-62. ISSN 1804-1930 DOI 10.7160/aol.2025.170204.

Abstract

In the last five years, the world has faced several events that have driven global uncertainty, namely pandemics and geopolitical events. Governments in various countries determine strategic policies to face global uncertainty. Governance has a crucial role in dealing with economic conditions amidst uncertainty. On the other hand, digital developments since the pandemic have also increased, which is expected to have positive externalities for society and the government in making economic decisions under uncertainty. This research examines the impact of governance and digital competitiveness on economic performance. This research uses secondary data from IMD publications for 2019–2023, covering a total of 58 countries. The data were analyzed using panel data regression. The research results show that there are disparities in digital competitiveness and governance in the group of countries with GDPs of more than $20,000 and less than $20,000, respectively. This difference leads to differences in economic performance between the two groups of countries. The governance dimension that affects macroeconomic performance is government governance, while for the agricultural sector it is business governance. The digital competitiveness dimension that worsens macroeconomic performance is future readiness, while for the agricultural sector it is the digital technology dimension. In a period of global uncertainty, infrastructure variables can drive economic performance, but on the other hand, they actually reduce the share of the agricultural sector. The more flexible anticipatory business behavior (due to more complete information) in the face of global uncertainty restrains the motivation for business expansion, which ultimately reduces economic performance. This research recommends to the government the importance of developing a strategy for handling future readiness and digital technology to support economic and agriculture stimulus policies in conditions of global uncertainty.

Keywords

Digital, technology, economic, government, agriculture

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