Digitalization and Indonesia’s Changing Policy Community

The research addresses how the impact of digitalization of the economy and society would reshape the nature of governance and politics. The paper focuses on Southeast Asia, and primarily Indonesia, the largest and one of the most diverse societies in the region. The analysis in this paper focuses on the effect of digitalization on the political process of redesigning government institutions and rearranging policy coalitions, rather than on the influence and control that social media has in terms of political information and electoral campaigns. I argue that the mutual infiltration of digital entrepreneurs and government institutions is a political process of finding a power equilibrium and stabilizing democracy while adjusting the state-society relationship within the changing nature of the digital economy and digital society. This paper highlights President Joko Widodo’s new recruitment policy and patterns of activity of new tech entrepreneurs as an attempt at state infiltration, while renewing the health services through the use of digital technology is an example of the politics of substitution. In the end, this paper demonstrates the formation of a “new digital elite” in Indonesia.