Effect of internet access on food expenditure and nutrition of Indonesian agricultural households

Abstract

The study analyses the direct and indirect effects of internet access on household food expenditure and nutrition using income as a mediating variable. Cross-sectional data from the March 2020 National Socio-Economic Survey by the Central Bureau of Statistics were used covering 127,672 agricultural households across 34 provinces in Indonesia. Information and Communication Technology (ICT) infrastructure development is employed as an instrumental variable to address the endogeneity of internet access. Data were analysed using the two stages least squares model and mediation regression. Findings indicate that internet access has a significant direct effect on household food expenditure and nutrition. Moreover, internet access indirectly influences these outcomes through its impact on household income. These results underscore the crucial role of ICT in improving the welfare of agricultural households by enhancing consumption patterns. Expanded ICT infrastructure facilitates better access to information on food prices, healthy consumption practices, and efficient shopping strategies which in turn boost household nutrition and food expenditure. This research has significant policy implications for strengthening ICT development and supporting the micro, small, and medium-scale food industry in Indonesia.