Future of Indonesia’s Industrial R&D using system dynamics

Erman Aminullah

doi:10.14203/STIPM.2026.436

Future of Indonesia’s Industrial R&D using system dynamics

Erman Aminullah

Abstract

This study attempts to explore the future of Indonesia's industrial R&D intensity based on historical data trends. A systemic approach and system dynamics modelling were used to explain Indonesia's high reliance on public funding for R&D activities. The simulation results show that: i. the policy of increasing industrial R&D investment can be implemented by transferring research outputs from research institutions to the industrial sector, as well as increasing R&D investment in the mission-oriented industrial sector. This is a challenging scenario for the most ambitious future R&D trends by 2045. ii. Limited R&D spending can have a tangible economic impact if public R&D organisations implement researcher performance evaluations based on R&D results' application in industry. Transferring government R&D outputs to the industrial sector will boost future industrial R&D in a moderate scenario by 2045. iii. Prolonged reliance on government R&D funding has the unintended consequence of lock-in dependence on public R&D funding, and further delays in increasing industrial R&D trends are most likely in a BAU scenario by 2045. The long-term policies should be executed integrally in realizing Indonesia’s transition to industrial R&D. This study's scientific contribution is a model of lock-in dependence on public R&D funding based on historical data.

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DOI: http://dx.doi.org/10.14203/STIPM.2026.436