Beyond AI Adoption: How Local Knowledge and Institutional Trust Shape Inclusive Economic Development in Emerging Economies
DOI:
https://doi.org/10.59525/jess.2167Keywords:
Islamic Economics, Society 5.0, Islamic Ethics, Digital Innovation, Maqāṣid al-Syarī‘ahAbstract
Artificial intelligence (AI) is increasingly recognized as a potential driver of productivity, innovation, and economic transformation. However, the economic benefits of AI adoption are not necessarily distributed equally across individuals, enterprises, and communities. In emerging economies, technological adoption occurs within social environments characterized by uneven digital capabilities, diverse cultural practices, and varying levels of institutional trust. This article develops a qualitative research framework to examine how local knowledge and institutional trust shape the pathways through which AI contributes to inclusive economic development. Drawing on the capability approach, institutional theory, and sociotechnical perspectives, the study conceptualizes AI not merely as a technological resource but as a socially embedded capability whose developmental outcomes depend on local interpretation, institutional legitimacy, and opportunities for meaningful participation. The proposed research employs an interpretive qualitative multiple-case study design, with small enterprises, community-based economic organizations, and local institutions in Indonesia as potential empirical settings. Data will be collected through semi-structured interviews, observations, and document analysis, followed by reflexive thematic analysis. The study aims to develop a context-sensitive theoretical explanation of how AI-enabled economic opportunities are translated or fail to be translated into broader participation, improved economic agency, and more equitable access to economic benefits. By integrating local knowledge and institutional trust into the analysis of AI-enabled development, the article seeks to contribute to debates on inclusive digital transformation in emerging economies.
References
Almeida, F. D., Glaum, J., Hildred, K., & Scott, I. J. (2026). Beyond black boxes: AI certification labels increase adoption through trust. Psychology & Marketing, 43 (9), 2464–2482. https://doi.org/10.1002/mar.70185
Baka, E., Krischer, N., De Silva, U., Tan, Y.-R., Yap, P., & Wong, B. L. H. (2026). Human-AI interaction in low- and middle-income countries: Qualitative study of how local human factors influence AI development and deployment. JMIR AI, 5, e78649. https://doi.org/10.2196/78649
Berkes, F. (2012). Sacred ecology (3rd ed.). Routledge.
Bijker, W. E. (1995). Of bicycles, bakelites, and bulbs: Toward a theory of sociotechnical change. MIT Press.
Braun, V., & Clarke, V. (2006). Using thematic analysis in psychology. Qualitative Research in Psychology, 3(2), 77–101. https://doi.org/10.1191/1478088706qp063oa
Braun, V., & Clarke, V. (2022). Thematic analysis: A practical guide. SAGE Publications.
Chaar, T., Filippucci, F., Jona-Lasinio, C., & Nicoletti, G. (2025). AI and the global productivity divide: Fuel for the fast or a lift for the laggards? OECD Artificial Intelligence Papers, No. 51. OECD Publishing. https://doi.org/10.1787/c315ea90-en
Daly, S. J., Wiewiora, A., & Hearn, G. (2025). Shifting attitudes and trust in AI: Influences on organizational AI adoption. Technological Forecasting and Social Change, 215, Article 124108. https://doi.org/10.1016/j.techfore.2025.124108
Davis, F. D. (1989). Perceived usefulness, perceived ease of use, and user acceptance of information technology. MIS Quarterly, 13 (3), 319–340. https://doi.org/10.2307/249008
Eisenhardt, K. M. (1989). Building theories from case study research. Academy of Management Review, 14 (4), 532–550. https://doi.org/10.2307/258557
Fukuyama, F. (1995). Trust: The social virtues and the creation of prosperity. Free Press.
Information Technology & People study. (2026). Trust dynamics for AI implementation in high-barrier environments: The moderating effect of government involvement. Information Technology & People, 39(2), 874–905. https://doi.org/10.1108/ITP-08-2024-1004
Jasanoff, S. (Ed.). (2004). States of knowledge: The co-production of science and social order. Routledge.
Lincoln, Y. S., & Guba, E. G. (1985). Naturalistic inquiry. SAGE Publications.
Malterud, K., Siersma, V. D., & Guassora, A. D. (2016). Sample size in qualitative interview studies: Guided by information power. Qualitative Health Research, 26(13), 1753–1760. https://doi.org/10.1177/1049732315617444
Malterud, K., Siersma, V. D., & Guassora, A. D. (2016). Sample size in qualitative interview studies: Guided by information power. Qualitative Health Research, 26 (13), 1753–1760. https://doi.org/10.1177/1049732315617444
Mayer, R. C., Davis, J. H., & Schoorman, F. D. (1995). An integrative model of organizational trust. Academy of Management Review, 20 (3), 709–734. https://doi.org/10.2307/258792
Nambisan, S., Lyytinen, K., Majchrzak, A., & Song, M. (2017). Digital innovation management: Reinventing innovation management research in a digital world. MIS Quarterly, 41 (1), 223–238. https://doi.org/10.25300/MISQ/2017/41:1.03
Nussbaum, M. C. (2011). Creating capabilities: The human development approach. Harvard University Press.
OECD. (2025). AI adoption by small and medium-sized enterprises: OECD discussion paper for the G7. OECD Publishing. https://doi.org/10.1787/426399c1-en
Orlikowski, W. J. (1992). The duality of technology: Rethinking the concept of technology in organizations. Organization Science, 3 (3), 398–427. https://doi.org/10.1287/orsc.3.3.398
Ostrom, E. (1990). Governing the commons: The evolution of institutions for collective action. Cambridge University Press.
Rogers, E. M. (2003). Diffusion of innovations (5th ed.). Free Press.
Scott, W. R. (2014). Institutions and organizations: Ideas, interests, and identities (4th ed.). SAGE Publications.
Sen, A. (1999). Development as freedom. Alfred A. Knopf.
Sen, A. (1999). Development as freedom. Oxford University Press.
Sen, A. (2009). The idea of justice. Harvard University Press.
Star, S. L., & Griesemer, J. R. (1989). Institutional ecology, “translations” and boundary objects: Amateurs and professionals in Berkeley’s Museum of Vertebrate Zoology, 1907–39. Social Studies of Science, 19 (3), 387–420. https://doi.org/10.1177/030631289019003001
Suchman, M. C. (1995). Managing legitimacy: Strategic and institutional approaches. Academy of Management Review, 20 (3), 571–610. https://doi.org/10.2307/258788
UNESCO. (2021). Recommendation on the ethics of artificial intelligence. UNESCO. https://unesdoc.unesco.org/ark:/48223/pf0000381137
Venkatesh, V., Morris, M. G., Davis, G. B., & Davis, F. D. (2003). User acceptance of information technology: Toward a unified view. MIS Quarterly, 27 (3), 425–478. https://doi.org/10.2307/30036540
World Bank. (2016). World development report 2016: Digital dividends. World Bank. https://www.worldbank.org/en/publication/wdr2016
Yin, R. K. (2018). Case study research and applications: Design and methods (6th ed.). SAGE Publications.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2026 A Fauzi Ilmi Arifin, Shofiyah Al Muwaffaqoh, Nurul Huda, Faulina Sara

This work is licensed under a Creative Commons Attribution 4.0 International License.






