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American Economic & Social Review; Vol. 6, No. 1; 2020 
ISSN 2576-1269E-ISSN 2576-1277 

Published by Centre for Research on Islamic Banking & Finance and Business, USA 

 

     39 
 
 

E-Government Development & Digital Economy: Relationship 
 

 
 

Mohammad Gias Uddin 
PhD Student 

 Department of Economics and Business 
University Tunku Abdul Rahman, Malaysia 

mail: mdgias89@gmail.com 
 
 

 Mohin Uddin 
Lecturer 

Department of Business Administration 
International Islamic University Chittagong, Bangladesh 

E-mail: mohin1uddin2@yahoo.com 
 

Abstract 
The main objective of this examine is to explore the elements that influencing the digital economic system and E-government 
courting. Commonly, the examiner is to analyze the impact of demographic variables are gender and schooling stage; as well as 
digital infrastructure, virtual readiness, virtual content material, and offerings on the digital economy in Malaysia. A minimum 
overall of 384 questionnaires could be disbursed to the goal respondents to collect the sample information. Four hypotheses 
helping to the developed to survey the particular targets of the examiner. Demographic variables expected to have a high-quality 
enormous relationship with the virtual financial system. Last however now not least, the findings of the look at shall offer statistics 
to E-government to understand what factors will affect the virtual economic system. Except, it shall additionally provide useful 
information for E-government to higher fit their people’s needs. The elements decided to boom high-quality dating among E-
government and virtual financial system in Malaysia. 
 
Keywords: Digital Economy, E-Government, Digital Infrastructure, Digital Readiness, Digital Content, and Services.  
 
1. Introduction 
World over past years economic going to traditional base (e.g: Industrial, agriculture) but recent few years world move to digital 
economy which base on digital technology (EIU) Economist intelligence unit 2010, Agnew 1999 & Tapscott 1999. So recently 
everywhere in the world technology development and people involved with social media (communication with social media), e-
business, the transformation has changed to e-government (Government offering E-government service for the citizen; Karen 
Mossberger et al 2008; Weill & Woerner, 2013). Digital economic its helps to economic growth research paper shows that 
(Brynjolfsson & McAfee, 2011). 

Alongside the advancement of digitalization, an amazing majority of governments have applied e-authorities tasks, even 
though the volume and scale in their implementation very substantially amongst nations (United international locations, 2012; 
Nograšek and Vintar, 2014). The sector financial institution (2008) defines e-authorities as using facts technology to improve 
business tactics and carrier delivery through authorities’ departments and different authorities entities. 

Dunleavy et al. (2006, p. 467) describe this fashion as “virtual-generation governance”, that is perceived with the aid of 
many researchers as critical for the emergence of post-New Public control governance (e.g. Cordella and Iannacci, 2010; Margetts 
and Dunleavy, 2013). The e-government fashion “Offers a possibly unique opportunity to create self-maintaining change, in a 
vast variety of intently connected technological, organizational, cultural, and social consequences” (Dunleavy et al., 2006, p. 467). 
In this regard, the character and the consequences of e-government come to be multidimensional and complex. 
But, to date empirical research supported through sound and hooked up theories to recognize the technique and the transformative 
effects of digitalization on public management is sparse (Bekkers and Homburg, 2007; Andersen et al., 2010). The literature 
review of Heeks and Bailur (2007) and Yildiz (2007) find that most of the e-authorities’ fashions within the literature have no 
strong theoretical grounding. Also, Shareef et al. (2011) locate that modern research tends to deal with special views on this 
complicated phenomenon in a scattered fashion. 
 

mailto:mdgias89@gmail.com


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1.1 Background of Study  
This look at seeks to cope with those weaknesses in the existing literature in three methods. First, it applies a multidimensional 
method to apprehend and seize the multifaceted courting among e-government development and the digital economic system. In 
this regard, it elaborates on the idea via Zhao et al. (2014a) that contextual factors including existing social, political, monetary, 
demographic, IT, cultural factors have interaction and play a great function inside the international procedure of e-authorities 
adoption and virtual development. Second, the examination is grounded on sound and well-set-up theories, appreciably the 
generation popularity version (TAM) (Davis, 1989) and the generation enactment framework of Fountain (2001, 2005). The 
former makes a specialty of expertise user adoption behavior while the latter tries to capture the effect of contextual technological, 
social, institutional, and political elements on generation adoption. In doing so, this examine contributes to more accurate and 
comprehensive know-how of the relationship between the two. Third, this look is empirical, engaging in a global look at of sixty-
seven countries using authentic international records units which include the UN’s e-authorities survey and the Economist 
Intelligence Unit’s (EIU) digital economy rankings. For this reason, the results of the study will have wider applications for 
policymakers on the national stage. 
 
Therefore, it causes studies gaps for this study inside the following: 
 
Research Gap 1: Lack of the systematical study of the conceptual framework 
Research Gap 2: Lack of the empirical study of the factors e-government development and digital economy 
Hence, the goal of this research is to evaluate and validate the determinants of e-authorities improvement and digital financial 
system. 
 
1.1.1 Definitions of E-government 
E-government is using statistics and communique technologies (ICTs) to enhance the sports of public quarter organization. some 
definitions restrict e-government to internet-enabled programs best, or simplest to interactions among authorities and outside 
agencies. 
 
1.1.2 What is the digital economy  
The digital economy refers to a financial system that is based totally on virtual computing technology. The virtual economy is 
likewise once in a while referred to as the net economic system, the brand-new economy, or the internet financial system. An 
increasing number of, the "virtual economy" is intertwined with the conventional economic system creating a clean delineation 
harder. 
 
1.2 Problem Statement  
The relationship between e-power systems and virtual finance. As expected, there may be a very strong correlation between the 
composite index for electronic authority development and the overall score for the virtual economy. To further test the relationship 
between the 2, we run SEM. The advantage of using SEM is that it takes account size into account to determine the relationship 
between a higher e-authority and the virtual economy. The SPSS software is used to generate estimates of maximum probability 
parameters. The healthy index is based entirely on strong changes in focus. The effect is to confirm that there may be a strong 
correlation between e-government and the digital economy. All the indices show a valid and healthy information model. Based on 
the results of each evaluation, we can confidently conclude that e-government contributes to and undermines the development of 
the virtual economy. 
 
1.3 Research Question 

▪ What are the elements that impact dating between e-government service development and the digital economy system? 
 
1.4 Research Objective  

▪ To determine the elements impact relationship among e-government service development and the digital economy system 
 

1.5 Significance of the Study 
Current years have witnessed speedy developments in e-government further to e-employer inside countries across the world. 
Although each e-authorities and e-industrial organization contribute in the direction of national monetary usual overall 
performance. 

These research findings will demonstrate the huge and intertwined roles of e-authorities and e-industrial enterprise in 
improving the countrywide financial performance. A good way to enhancing countrywide monetary income, this research indicates 
that policymakers must recall measures to beautify the development of e-government and e-company collectively. 



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1.6 Organization of Study 
The next part of this thesis discusses the basic concepts of this research theory, which helps to formulate your hypotheses and the 
research framework. The next section explains the methodology and presents the statistical results, while the next section discusses 
the results and their implications for the development of policies and theories. Therefore, the limitations of the research and the 
suggestions for future research are analyzed before considering the main contributions of the study 
 
2. Literature Review 
2.1 Introduction 
According to an Economist Intelligence Unit (EIU) ()2010, Agnew 1999, and Tapscott 1999, in the world economy was used 
by the traditional basis in the past years like industrial organization, agriculture, Farming, and so on. But now, these traditional 
economy turns into the digital economy by the use of digital technology and providing ICT benefits of the customer, government, 
and businesses of a country. Allowing by the government of many countries, the digital economy helps to support the people and 
society of the countries. Digital economy helps to digitalize the trade, market, and economics through technology.  
 
2.2 Definition of Digital Economy 
The definition of Brynjolfsson and McAfee, 2011, shows that the digital economy plays a role to increase the economic growth 
of a country. By the digital economy, the government can establish e-government which increases the market value of products and 
services and helps to measure the Gross Domestic Product or GDP of a country. Also helps to measure Gross National Product 
or GNP to increase foreign earning by the technology.  
            Tapscott (1996), describes the digital economy as the new framework which is created with the help of human and their 
intelligence. There are some characters associated with the digital economy that our knowledge of people, digitalization on 
activities, internetworking with the activities, innovative assets, and so on.  All of these characters help the world to make more 
digital than the traditional industrial economy. He also added that the contemporary position regarding connectedness with the 
various concepts is created with the help of the digital economy. 
             From OECD broadband statistics, the digital economy is the more digital and established network. It is using in various 
workplace to reduce problems, increasing skills and opportunities for individuals and groups, and make them successful in different 
fields. According to OECD, about 22 of percent people are related to ICT activities for establishing themself. Digital economy 
increases opportunities and options for individuals, consumers, workers, the government of one country. 
 
2.3 Definition of E-Government 
Dunleavy et al. (2006), he establishes a new digital era government (DEG) defines that this DEG is used for the societal, economic, 
technological development in many countries. By DEG a government can provide better services, quick delivery of products to the 
clients, create digitalization for the public services. For using the digital era government, they can use cloud computing, social web, 
and so many apps. Some Researchers from different countries use to post contemporary civil administration government. 
 
2.4 Definition of Digital infrastructure 
By Davis 1989, well-established theories were made, most significantly use the Technology Acceptance Model (TAM). According 
to Davis, he includes how these models accept by the people and use to establish the activities of users. Many factors used by them 
how to use when to use the model to make and involve the economic government. Perceive use fullness and perceive comfort about 
consume is the main task and circumstances toward use model. He focuses on the formal acceptance of the model and creates an 
impact on the social, economic, political, institutional factors to adopt a model. This model creates an accurate and appropriate 
understanding and a relationship between the digital economy and e-government. 
 
2.5 Definition of Digital Readiness 
According to Fountain 2001, p 10, Technology is increasing more than in past years. Technological objectives like hardware, 
software, network capacity is upgrading their storage day by day. It helps to create more digitalization in the world. These digital 
activities involved with multiple roles that make interaction and create influence between digitalization and technology.  
 
3. Hypothesis Development 
The TAM method framework by Davis 1989, defines that both the digitalization and e-government with the technology involved 
with economics, sociology, politics, management, culture, and so on. He included that the TAM method and variable approaches 
show the hypothetical relationship between the e-government and digital economy. 
Economist Intelligence Unit (EIU) 2010 measures an economy on the digital economy. It rests with the culture of an economy 
that effects the digital economy. 
 



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3.1 E-Government 
Dunleavy et al., 2006, p. 467, also added that E-Government provides a unique opportunity for a country to make a dramatic 
change for its people. It provides technical opportunities to their people so that can be technically skillful to do any kind of job. 
It helps in organizational activities like training the employees for use of a machine, more production, and resource allocation, and 
so on. It also makes a unique change of culture which makes them different from others and also social effects. All of these factors 
are relating to each other on e-government. Including all of these factors, the government turns into multi-dimensional and operates 
all those activities which are more complex than before. 
              Doong, H., Wang, H., and Foxallc, G.R. (2010) said that a psychological approach is used to examine the classical 
models, use the existing literature, adaption of citizenship, innovation cognitive styles, and involvement influence the loyalty 
intentions. Higher loyalty intention is related to the e-government. People involved in the loyalty intention and other sectors to 
use in e-government. Some psychological factors are associated with e-government and try to help better activities than before. 
              World bank 2008 defines that e-government is increasing with the use of technology. By information technology 
government increases its business activities, services provided to the clients and society with the help of the government 
departments, and other governmental entities.  
              According to, Bélanger, F. and Carter, L. (2012), the e-government creates a new domain with information technology 
which shows the interaction between the government constituents. Previously e-government was themed by the information system, 
political science, public administration, and so on. Along with the information system, e-government can create theoretical 
activities, methodology, sampling, and so on.  Over time e-government discover much new knowledge, relations, era for the people 
and society of own country. 
             According to Björn, N., Elena, G., and Ralf, P. (2012), E-government with the help the digital economy makes the mutual 
benefits for both the citizens and public administration. Through the use of the internet, different kinds of internet adoption help 
to improve the concept of e-government. There is some corresponding research model social-demographic factors like age, gender 
helps to make the e-government more perfect.  E-government distinguishes the user from an online user and traditional user of 
technology, institution, social activities and motivate people and train them to increase activities through the digital economy and 
develop of e governmental activities. 
              The definition of Bretschneider, S. (2003) shows that informational technology slowly enters into all fields of 
government like governmental organizations, institution, and so on. This information technology converts all the data of 
governmental activities analog to digital.  It makes the organization of the government and digital evaluation analyzes the activities 
effectively and efficiently. E-government with the help of the internet collect data from all the parts of the country, delivers services 
online, also provides direct delivery of services to their clients. Information technology also helps the government to restructure 
the organization, an institution of government, in the developed countries, the information system uses the most. It uses both the 
government and political activities, through the digital economy. 
              Coursey, D. and Norris, D.F. (2008) said so investigation activities within E-government are new. He suggests using 
some model to test the accurateness of the government. These methods help to identify activities associated with e-government 
and the actual development of e-government. Locale governmental activities are more informative and accurate to reduce the 
problem associated with them. But those models cannot accurately describe the development of e-government. They link both the 
information technology and government to predict and observe the activities associated with the government. 
 
H1: E-government is positively related to the influence of the digital economy 
 
3.2 Digital Infrastructure 
Cordella and Iannacci, 2010; Margetts and Dunleavy, 2013 also analysed the digital era environment. They use the system in the 
post-management government system. After developing the model, the researcher uses it in the rural or insolvent area in the world. 
By training, the employees make them more skillful. Digital era government makes the organization, institution more successful, 
and provides services to their clients through the internet. The digital government also called e-government reaches the appropriate 
level with the help of better technology.  
                  The rapid growth of information technology also increases the help of information and communication technology 
in a broad sense. ICT help us to reshape our life and business activities globally. The internet with the help of information 
technology has become a vital infrastructure all over the world. According to the World Economic Forum (2014), the use of the 
internet is increasing all over the world of 1.5% for per capita GDP growth. The digital access with the help of internet 
infrastructure provides services and help to the individuals, businesses, geographical area, society, and other emerging economic 
activities. Digital infrastructure also helps to increase the digital economy and e-government with increasing skills. 
                   According to World Bank (2016), Digital infrastructure with the help of technology increases the number of 
information, reducing the cost rate, reducing difficulties, bringing better innovation, sharing information, and so on. It creates 
better connectivity among, people, businesses, and government. The ultimate goal of the digital economy is to provide equal 



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facilities in the organization and so on. The new use of ICT and the internet creates a new economy which increases transparency, 
reducing the inefficiency of a lack of information, and so on. 
                  Bertot, J.C., Jaeger, P.T., and Grimes, J.M. (2010) include that many governments want to change their activities 
effectively and transparently. Information and communications technology (ICT) are more cost-effective to promote the activities 
of the government.  E-government is increasing providing comprehensive support for the nations. Information technology and 
ICT both try to make good e-government and transparent activities. ICT provides updated information, transparency to the 
society, good initiatives to take, building a better culture, changing agent, and so on. 
 
H2: Digital infrastructure is positively related to the influence of the digital economy 
 
3.3 Digital Readiness 
Economist Intelligence Unit (EIU) 2010 and United Nations 2012 show that many data for digitalization are collected from the 
higher networking system, a well-known website, e governmental policies, and strategies that are involved with these. All of these 
sources are established by digital readiness with the help of technology. 
                     From the research of Pew Research Centre, With the faster growth of Technology, many people or society are 
unable to reach in the situation, from 1930, when the electricity was developed for the household services, many American rural 
people were unable to reach in the opportunities. Internet and Smartphone are increasing day by day. But many people in the 
world, unaware of these features and activities. They also added that digital readiness has several characteristics which are digital 
skills, need for every people to access, and use the internet. Second, they need trust to use the digitalization and the third one is 
using digital technology. The digital economy should ensure that they must reduce the digital realness and train the people to come 
up with the situation. 
                   The trust, use, and skill of digital readiness can be measured. The Pew Research Centre 2015, the element of the 
digital readiness can be measured how satisfied the people are, how can they cope up with the digital economy, how can they learn, 
etc. Digital learning is also called the way of learning. They concluded that with the help of digital readiness can be more experience, 
people can learn more and will be more digitalize.  
 
H3: Digital readiness is positively related to the influence of the digital economy 
 
3.4 Digital Content and Services 
Carlsson, B. (2004) indicates a new economy that shows the new trend of the economy. This new economy includes digitalization, 
the combination of the internet creates a new era of technology. It develops the relationship between actors and ideas. These new 
economies are continuous with the internet, multiple actors and ideas, a good level of connectivity with people and create a long-
term goal. With the new trend of the economy, it develops in the production unit, agriculture, operating activities, manufacturing 
more than tradition. 
                    Erumban, A.A., and de Jong defines that, the use of information communication technology is using day by day. The 
rate of adoption increases as the income level increases. The adoption rate of ICT is slide related to the national culture and 
international culture. But most of the time they differ from each other. ICT helps to increase power and reduce uncertainty 
throughout the country. After creating a balanced level, ICT helps to control the entire problem related to education and income. 
                   Cooper, R.B., and Zmud, R.W. (1990) define Material requirements planning: MRP should be identified and 
examined clearly. Information technology is related to managerial task to reach the goal. With the Material Requirement Planning 
method, random sampling is also used to calculate the activities associated with the organization. Information technology includes 
the adoption, political activities, financial activities, and other activities to examine the infusion associated with the organization. 
Various important materials should be perfectly planned to reduce wastage and reach their goals.  
                   According to Chinn, M.D., and Fairlie, R.W. (2006), in developing countries, computers, and internet use are 
increasing. Both developed and developing countries use the penetration rate, adoption rate through technology. The role of a 
comprehensive set is used in demographical, infrastructure; economic activities are used in the global area. Financial development 
with stock, trade is used for the growth rate with the use of the internet. In the internet penetration telephone sector, various rates 
are included to work with the technology and analyze the differences between the computer and other technology with the ICT 
sector. 
                 Department of Broadband, Communications, and the Digital Economy, Australian Government specifies that eight-
goal are used to identify the connectivity and the use of digital technology and helps to set up a vision to associate with the global 
digital economy. Through the use of the digital economy, people from remote area can find educational, health services. They find 
out new initiatives for the improvement of the digital future. With the digital economy, the government will become digitalized. 
A correspondence is used to identify and improve performance and acceptance through online. With the digital economy, the 
government also uses online mailboxes. ICT skills are also helpful for the digital future of the government. ICT includes technology 



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and try to help and develop a relationship with both industries of government and educational institution. The digital economy 
helps individuals, business people, and non-profits organizations and so on. The government also helps to reach the goal and 
establish digital platform. The document shows that the digital economy helps to run the objective of the future, reflect the rapid 
growth digital future.  
                Chang, I.C., Li, Y.C. defines and creates the model of tax filing system which is reasonably accepted by the clients. He 
includes many factors to create the intention of the clients to use the system. And the system is related to the information system 
quality which provides quality information to their clients. These tax systems are used most in the governmental organization, 
institutions. In the governmental activities, the taxpaying system is used the most provided by the government. 
 
H4: Digital content and services are positively related to the influence of the digital economy 
 
4. Research methodology 
4.1 Conceptual Framework 
According to Fountain 2001, Schellong 2007, various important theoretical models create a conceptual framework for the 
workplace. They define that the model of Fountains technology makes a structured framework for the government. They also 
literal on the nation’s industrialization activities, bureaucracy, the networking organization of the country, and lastly include 
governance to provide the society. 
                  Fountain 2001 also added that technology, organizations, institutions help to take a better framework for both the 
digital economy with the government. A digital economy with the use of information technology can create better opportunities 
for the government. New technology also helps to make an automatic change. It also makes the change in the organization, the 
process of an institution, and so on. Fountain defines that the digital economy can make a conceptual framework in governmental 
activities. 

Proposed Conceptual Frameworks 

 
 

Figure 1: Proposed model of the relationship between E-government service development and Digital Economy system 
 
4.2 Hypothesis  
H1: E-government is positively related to the influence of the digital economy 
H2: Digital infrastructure is positively related to the influence of the digital economy 
H3: Digital readiness is positively related to the influence of the digital economy 
H4: Digital content and services are positively related to the influence of the digital economy 
 
4.3 Variables 
4.3.1 Independent Variables 
-Digital infrastructure 
-Digital Readiness 
-Digital content and services 
 
 
 

 

 

  

 
 

 

 

E- Government 

  

Digital Economy 



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4.3.2 Dependent Variable 
Digital economy 
 
4.3.3 Mediating Variable 
E-government  
 
4.4 Questionnaire Design and Measuring Scale 
Surveys are the easiest and popular way to collect number one statistics. Since this survey is largely based on information number 
one, the questionnaire form is used as a survey tool. The questionnaire was designed by Google form in an online-based formula. 
Following, Jezz (2002), the survey way on the global network was convenient, green time, and administrative convenience. This is 
a good option for connecting populations with greater access and destinations within larger and more diverse populations and 
special populations that may be a bit difficult to reach “Coomber (1997), Smith and Leigh (1997), Buchanan and Smith (1999)”. 
Furthermore, network online-based questionnaires can give excessive levels of anonymity that increase self-esteem and reduce 
anxiety and social desirability “Coomber(1997); Joinson(1999)”. 
            We send email to selected respondents for inviting an online-based URL hyperlink where include questioner server shape, 
the respondents need to completed questionnaire server just 7 to 10 minutes and respondents also get knowledge from the servery  
 
4.5 Target population and Sampling  
Target population we focus base on Malaysia were people connecting with their e-governance and digital financial system. Totally 
the population of Malaysia (2018), thirty million.  We use some random sampling for study purpose to know activity with e-
governance and digital economic       
   
4.6 Frequencies Distribution 
One of the methods for displaying specific information is the frequency distribution. So far, a clear and strong information view 
from respondents. So, this study helps me to get respondents information that can be analyzed using the frequencies distribution 
function by the SPSS software. 
 
4.7 Pilot Test 
The submitted questionnaire was examined through experimentation before the last questionnaire was sent to the actual 
respondents. This test verification is intended are guarantee to the clarity and reliability of the proposed questionnaire and to 
obtain previously identified complexity. In line with (Malhotra; 2008), it Generally reduced the sample formula with a 15-35 
interview. 
  
         Table 1. Pilot Test Result 
 

Variables Cronbach’s α 

Attitudes 0.854 

Subjective Norms 0.829 

Perceived Behavioral Control 0.653 

Self-Identity 0.786 

 
4.8 Facts Evaluation 
This view uses four statistical analysis tools: descriptive notes that provide initial information on the demographic background of 
the respondents, reliability analysis of Alpha Cronbach that examines the reliability of the questionnaire used, analysis of factors 
related to independent predictive variables of multiple factors and coefficients of correlation Kendall tau_b guarantees correlation 
coefficients between independent and dependent variables. 
 
4.9 Descriptive Statistics 
Expositive statistics describe the main skills of statistics. It has given a brief description of the model and presents quantitative 
measurements or descriptions in a simpler design. In this case, descriptive information is used to evaluate the interviewed 
demographic inheritance. This demographic context includes gender, age, higher education phase, modern profession, and income 
phase. 



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                 Which will pump specific and dichotomous records on the SPSS software analysis program for explicate records 
evaluation? similarly, month-to-month gross earnings are divided into 6 agencies ranging from 1 to 6 for much less than 2000 
RM, 2000 RM to 3999 RM, 4000RM to 5999 RM, 6000 RM to 7999 RM, 8000 RM to 9999 RM, 10000 RM & above. 
 
4.10 Reliability Analysis 
The reliability evaluation offers statistics when referring to the relationship between the elements of the character tool. 
 

   Table 2.Comparing the Cronbach’s Alpha for a different number of variables but the same average correlation 
 

Average Correlations No. of Variables Cronbach’s Alpha (α) 

0.5 1 0.500 

0.5 2 0.667 

0.5 3 0.750 

0.5 4 0.800 

0.5 5 0.833 

0.5 6 0.857 

0.5 7 0.875 

0.5 8 0.889 

0.5 9 0.900 

0.5 10 0.909 

0.5 11 0.917 

0.5 12 0.923 

0.5 13 0.929 

0.5 14 0.933 

0.5 15 0.938 

Source: Nunnally (1978). 
 
4.11 Correlations Analysis 
Table 3. Interpretation of the range of Correlations Coefficient analysis 
 

Positive Negative Interpretation 

+1.00 -1.00 Perfect 

+0.80 to +0.99 -0.80 to -0.99 Very Strong 

+0.60 to +0.79 -0.60 to -0.79 Strong 

+0.40 to +0.59 -0.40 to -0.59 Moderate 

+0.20 to +0.39 -0.20 to -0.39 Weak 

+0.01 to +0.19 -0.01 to -0.19 Very Weak 

Source: Adopted from Salkind (2009)  

 
4.12 Moderated A Couple of Regression 
It is possible to use more than a simple regression or regression model to find the presence of a simple result of the economic 
situation and the involuntary desire between the digital economy and electronic government. To examine the hypothesis of a direct 
and moderating relationship between the digital economy and moderate e-government, several regression analyzes were transformed 
into the following techniques used by “Darrow and Kahl, 1982” and “Hair et al, 2010” and “Evans, 1987”.  The independent 
variable is in the first phase to obtain an effect of temporal principle in the second degree; Dependent variables are transformed 
into regressions of independent moderating variables and consist of undistorted variables and moderators.  
 
4.13 Conclusion 
Finally, you can then perform a Pearson Correlation or Kendall t-test analysis to test the relationship between each of the distorted 
variables and the variables that are determined based on the results of the normal test. Sooner or later, simplifying more than one 



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version of the regression will be used to examine the effects of economic conditions and the relationship between the digital 
economy and e-government. 
 
5. Results & Findings 
The main point of correlation result analysis is to identify the correlation between open digital infrastructure variable, digital 
availability, digital content and services and, government-dependent variables in the digital economy. 
               The survey sample study of 430 Malaysians who were randomly selected. Initially, the online questionnaire was designed 
using Google forms for collecting questioner data. The google form URL send to people via email & social media platform in 
November 2018. A total of 320 samples were collected via the online form. Because of the smaller number of respondents in the 
online google survey form. 
 
                         Table 4. Population from Respondents 
 

Questionnaire Total Number of Responses 

Google form Questionnaire Distributed 320 

Printed Questionnaire Distributed 110 

 Incomplete Questionnaire 46 

Useable Questionnaire 384 

 
5.1 Frequency Distribution 
Table 5. Respondents by Demographic Characteristics 
 

Variables By age  Frequency total Percentage% 

Gender Male 191 48.6 

 Female 202 51.4 

Age Below 30 years old 143 36.4 

 30 to 39 years old 109 27.7 

 40 to 49 years old 86 21.9 

 50 to 59 years old 41 10.4 

 60 years old and above 14 3.6 

Highest Education Level Total Primary levels 2 0.5 

 Total Secondary levels 118 30.0 

 Total Diploma levels 67 17.0 

 Total Bachelor’s degree  levels 169 43.0 

 Total Master’s degree   levels 32 8.1 

 Total Doctoral degree  levels 4 1.0 

 
 

Total Others levels 1 0.3 

 
5.2 Reliability Tests 
Table 6. Reliability Test Result 
 

Numbers of Variables Before  After 

Numbers of Item Cronbach’s α Numbers of Item Cronbach’s α 

Digital Infrastructure 5 0.746 5 0.746 

Digital readiness 5 0.655 4 0.717 

Digital contents and service 6 0.672 5 0.744 

E-government 2 0.713 2 0.713 

  Digital economy 4 0.457 3 0.720 

Notes: Question 6, 11, and 19 from and from to increase Cronbach’s α 



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5.3 Factor Analysis 
The factor analysis was performed using the method of extracting the main components on digital economic variables, electronic 
government, digital infrastructure, digital availability, digital content, and services. As evaluated in Table 4.4, the sample value of 
the Kaiser-Meyer-Olkin (KMO) measurement factor was 0.817. According to the practical rules proposed by Kaiser (1974), a 
KMO greater than 0.8 for this analysis is useful and can be followed by factor analysis. Furthermore, the Chi-square estimated in 
the Bartlett Sphericity Test was 2090,756 with 171 degrees of freedom and a significant Chi-square value (p <0.001). Factor 
analysis is considered a suitable technique for future data analysis. 
 
Table 7.  Result of KMO and Bartlett’s Test 
 

Kaiser-Meyer-Olkin Measure of 
Sampling Adequacy 

 0.817 

Bartlett’s Test of Sphericity Approx. Chi-Square 2090.756 

 Df 171 

 Sig. 0.000 

 
Table 8. Communalities 
 

 Initial Extraction 

1) The digital economy has improved the economic condition of Malaysia 1.000 .411 

2) Digital economy supports the sustainable development of Malaysia 1.000 .596 

3) The digital economy has a positive influence on e-government 1.000 .585 

4) Digital economy builds trust towards e-government development 1.000 .584 

5) The digital economy is helpful for e0government development 1.000 .603 

6) E-government has improved the economic condition of Malaysia 1.000 .383 

7) E-government supports the sustainable development of Malaysia 1.000 .537 

8) E-government has a positive influence on the digital economy 1.000 .542 

9) E-government builds trust towards digital economy development 1.000 .613 

10) E-government is helpful for digital economy development 1.000 .569 

11) Digital infrastructure has improved the economic condition of Malaysia 1.000 .503 

12) The digital infrastructure supports the sustainable development of Malaysia 1.000 .617 

13)Digital infrastructure has a positive influence on the digital economy 1.000 .565 

14) Digital infrastructure builds trust towards digital economy development 1.000 .601 

15) Digital infrastructure is helpful for digital economy development 1.000 .731 

16) Digital readiness creates opportunities for the digital economy 1.000 .764 

17) Digital readiness support development of the digital economy in Malaysia 1.000 .688 

18) Digital readiness has a positive influence on the digital economy 1.000 .661 

19) Digital readiness builds trust towards digital economy development 1.000 .555 

Extraction Method: Principal Component Analysis.   

 
Table 9. Digital content & Services Variable Normality Test of Normality 

 
 
 
 
 

Kolmogorov-Smirnovaa  Shapiro-Wilk  

 Statistic df Sig. Statistic df Sig. 

Digital Content & Services .101 384 .000 .958 393 .000 



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Table10. E-government and Chi-Square Test 
 

Chi-Square Tests 

 Value Df Asymp. Sig. (2-sided) 

Pearson Chi-Square 23.554a 12 .023 

Likelihood Ratio 25.236 12 .014 

Linear-by-Linear 
Association 

 
1.364 

 
1 

 
.243 

N of Valid Cases 384   

a. 2 cells (10.0%) have expected count less than 5. The minimum expected count is 4.37. 

 
Table 11. Digital Infrastructure and Chi-Square Test 
 

Chi-Square Tests 

 Value Df Asymp. Sig. (2-sided) 

Pearson Chi-Square 23.554a 12 .023 

Likelihood Ratio 25.236 12 .014 

Linear-by-Linear 
Association 

 
1.364 

 
1 

 
.243 

N of Valid Cases 384   

 
Table 12. Digital Readiness and Chi-Square Test 
 

Chi-Square Tests 

 Value Df Asymp. Sig. (2-sided) 

Pearson Chi-Square 35.792a 16 .003 

Likelihood Ratio 34.685 16 .004 

Linear-by-Linear Association 8.972 1 .003 

N of Valid Cases 384   

 
Table 13. Digital Content & Services and Chi-Square Test 
 

Chi-Square Tests 

 Value Df Asymp. Sig. (2-sided) 

Pearson Chi-Square 35.792a 16 .003 

Likelihood Ratio 34.685 16 .004 

Linear-by-Linear Association 8.972 1 .003 

N of Valid Cases 384   

 
Table 14. E-government, Digital Economy, and Kendall’s tau b Test 

 
 

Health Value Attitude 

Kendall’s tau_b E-government Correlation Coefficient 1.000 .292** 

  Sig. (2-tailed) . .000 

  N 384 393 

 Digital Economy Correlation Coefficient .292** 1.000 

  Sig. (2- tailed) .000 . 

 

 

 (N) 384 393 



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Table 15. Digital Infrastructure, Digital Economy, and Kendall’s tau b Test 

 
**. Correlation is significant at the 0.01 level (2-tailed). 
 
Table 16. Digital Readiness, Digital Economy and Kendall’s tau b Test Correlations 
 

 
**. Correlation is significant at the 0.01 level (2-tailed). 
 
Table 17. Digital Content & Services, Digital Economy, and Kendall’s tau b Test  
 

 

6. Summary of Analysis 

Table 18. Hypotheses Testing Summary 
 

Item Hypothesis Statement test Result 

H1 E-government is positively related to the influence of the digital economy Accepted 

H2 Digital infrastructure is positively related to the influence of the digital economy Accepted 

H3 Digital readiness is positively related to the influence of the digital economy Accepted 

H4 Digital content and services are positively related to the influence of the digital economy Accepted 

 
7. Conclusion 
This chapter affords the dialogue and ends approximately the find it examiner, challenge and as well as futurity experiment  
 
 
 

Health Value DS Purchase Intention 

Kendall’s tau_b Digital infrastructure Correlation Coefficient 1.000 .295** 

  Sig. (2-tailed) . .000 

  N 384 384 

 Digital 

Economy 

Correlation Coefficient .295** 1.000 

 Sig. (2-tailed)    .000 . 

  N 384 384 

   Health Knowledge     Attitude 

Kendall’s tau_b Digital readiness Correlation Coefficient 1.000 .262** 

 Sig. (2-tailed) . .000 

  N 384 384 

 Digital Economy Correlation Coefficient .262** 1.000 

  Sig. (2-tailed) .000 . 

  N 384 384 

   
Health Knowledge 

DS Purchase 
Intention 

Kendall’s tau_b Digital content 

& Services 

Correlation 

Coefficient 

1.000 .251** 

 Sig. (2-tailed) . .000 

  N 384 384 

 Digital 

Economy 

Correlation 

Coefficient 

.251** 1.000 

 Sig. (2-tailed) .000 . 

  N 384 384 



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7.1 Study on Findings 
At fast, it is far thrilling that the study from this seems at observed the people have no dating on the E-government, virtual 
infrastructure, virtual readiness, digital content material, and offerings with the virtual economy. Therefore, this result is not regular 
with the preceding findings acquired with the aid of Kennedy et al. (2013) and Ong et al. (2014) discovered out that digital 
economic system is most commonplace amongst ladies regarding E-authorities, virtual infrastructure, virtual readiness, digital 
content material and services girls. In other words, it means that can't be judged through gender. it could be quality explained that 
virtual economy is not best not unusual amongst ladies in Malaysia, however, it is also not unusual amongst guys in recent times 
as Malaysians have become extra digital financial system conscious (The celebrity online, 2017a). Similarly, it additionally may be 
defined that clients in Malaysia likely are more pick on the virtual economic system. 
                Alternatively, this observes additionally exhibits that the training stage also has no relationship to digital infrastructure 
and the virtual economy. Accordingly, this results additionally inconsistent with the result acquired by way of Bailey et al. (2010), 
Paul and Rana (2012), and Dickinson & Mackay (2014), which of their studies found that better education level becomes 
connected with the virtual economic system. Its way that, for the populace in Malaysia, E-government and digital financial system 
relationships cannot be chosen via their schooling level. It could exceptionally explain that people with better education levels 
might decide on E-authorities and digital economic system wonderful relationship (Huffington put up, 2011). Similarly, the 
virtual infrastructure is typically less expensive as compared to physical infrastructure. On the other hand, human beings with low 
schooling stage might affect on using of E-government with the digital economic system. 
                From the study provided a solution to the 1st research finding or not E-government and Digital systems are motivated 
via demographic data. And 2nd   research findings on this examination observed that purchasers’ features have a sizeable connection 
with E-government & virtual financial system. It way that the information stage will affect the E-authorities, and the virtual 
economy relationship. Moreover, the findings display that there is a vast nice relationship between E-authorities with the virtual 
economic systems. This result is constant with the findings from Conner et al. (2001), Tromp et al. (2005), Jun et al. (2014), 
and Dickinson & Mackay, (2014). In different phrases, people with higher E-government centers are much more likely to have a 
high-quality impact on the virtual economy. On top of that digital content and offerings also indicates a widespread fantastic 
relationship with the digital financial system. This locating is helping by using de Magistris & Gracia (2013) also using Harris 
and Thomas (2016) and Hsu et al. (2016). Digital readiness can influence the digital economic system. Consequently, the Ministry 
of ICT should have post greater effort on teaching human beings in the course of Malaysia approximately E-authorities related 
difficulty in Malaysia.  The feature will affect digital readiness and the digital economy. Thirdly, this study observed out that have 
an impact on and manage together with digital readiness, and virtual economic system has proven a wonderful importance courting. 
It implies that better virtual readiness will extra tend to persuade the virtual financial system. The findings are constant with 
preceding research Conner et al (2001), Conner et al (2003), Chen (2007), Chung et al. (2012), Emanual et al. (2013). With the 
development of generation, human beings can now be without problems prompted by way of digital readiness and virtual economy. 
Next, it's far observed out that there's a nice widespread courting between E-authorities with the virtual economy. This result is 
regular with the findings that acquired from Chen, (2007) and Gabriels & Lambert, (2013), which inform that there may be high 
quality have an effect on E-government on the virtual economic system. However, this relationship could be very sturdy amongst 
the populace in urban areas of Malaysia. E-government for the city population is plenty greater encouraged by using the digital 
economy system. furthermore, it is found out that there may be a high-quality extensive courting among digital infrastructure and 
virtual economic systems; high-quality enormous courting with the digital content material and services with digital economy. The 
finding is steady with the result received via Chung et al. (2012) which discovered that virtual readiness changed into a robust 
impact inside the formation of a digital economic system. Further, the finding additionally consistent with the previous studies 
acquired by using Okleshen Peters et al. (2004) and Chen (2007) that higher virtual content material and services will have an 
impact on the virtual economic system. Those factors controlled to respond to the third research query on whether or not virtual 
content material and offerings will affect the digital financial system. In the end, the result of this study discovered that there is a 
significant relationship among the digital content material and offerings and digital financial system. The virtual content material 
and offerings determined out to be the most powerful predictor of the virtual economic system on this observe. The finding is 
constant with the result acquired from Armitage and Conner (2001). this is regular with the locating acquired with the aid of 
Chung et al. (2012). The end of the result of these paper virtual content and services and virtual economy courting. 
 
7.2 Implications 
Even though 1/2 of the population in Malaysia avail E-authorities and digital economy centers but growing at an alarming level. 
1.8 million of the 3.5 million human beings in Malaysia have been no longer alert they had been lacked in the back of E-governance 
and the digital financial system in Malaysia has improved to 17.5% in 2015 from 15.2% in 2011 (New Straits instances, 2016). 
Hence, there are many things that need to be done to raise focus in Malaysia to create an E-government dominated society for the 
present day and new era. in line with the demography attribute seen on table 4.2 from the preceding section where male come up 
with 52.8% of a general interview at the same time as a lady at 48.2%. From the interview total respondents’ people where most 



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of the people respondents under 40 years’ antique, that is generation Y and Z.  also we got most of the respondents to possess a 
bachelor’s degree, followed through a secondary level and diploma as their highest schooling stage. as a result, the subsequent 
Those involved are being offered to deal with this class of people 
                First, each individual always wants to stay updated with the digital economy. no one desires to the back of the E-
government have to prepare digital economy thought to communicate to their human beings at the time whilst selling digital 
economy. Each gender business must be targeted similarly as E-government associated difficulty in recent times appears uniformly 
concerned via male and lady. 
                Secondly, for Gen Y and Z, the digital financial system is indicated through both correct. Government knowledge is 
critical for them in preserving the proper virtual economic system. a hectic life-style had changed our economic lifestyles. A have 
a look at also reveals that lengthy-term hit E-authorities can build a sturdy digital economy (The celebrity on line, 2017). thus, 
man or woman ought to encourage E-authorities for establishing a digital economic system. As such, digital economy know-how 
should be included in our schooling machine as a middle problem. The government should beautify our training gadget by using 
integrating the crucial of the digital financial system into the syllabus of number one and secondary school. 

Thirdly, an era is primary to Gen Y and Gen Z digital financial system practices. A remark from pals and own family 
contributors can significantly affect the digital economic system of Gen Y and Z. E-government becomes so powerful with the 
help of technology along with the net and social media including Facebook. Also, digital word-of-Mouth (E-WOM) has also 
come to be a powerful and important tool on social media, which can be adopted by E-government to grow their attention to the 
virtual economic system. Thru social media, humans can share their notion, opinion, and remark about the virtual financial system 
with their pals and own family participants on social media. As a result, this E-government sure will influence peoples’ attitudes 
towards the digital financial system. one of the success stories that undertake E-government as their device is EDEKA, considered 
one of the most important economies in Germany, had efficaciously hooked up a connection with its human beings and will 
increase their consciousness about digital economic system via social media (Business Wired, 2015). 

Fourthly, fact search is a crucial level inside the virtual financial system. The millennial technology had extensively used 
the net to collect statistics. A generation had made records will become very reasonably-priced and may be acquired in a completely 
fast manner whenever and anyplace. compared to standard media together with television, radio, mag, and newspaper, net 
technology can now without difficulty search and obtain information from the net. E-government ought to sell its virtual economy 
through the social media platforms. Cyberspace permits the virtual economic system to attain its goal population in a rapid and 
fee efficient manner. similarly, educated humans could be capable of interpreting records easily. 

Final however not least, Gen Y and Z will always like to examine an E-government with the virtual economy. with the 
intention to grow the virtual economic system of a populace, we need to positioned greater effort on E-government. To lower 
down the charge, the authorities have to additionally encourage the digital economic system in Malaysia through some incentive 
applications. further, the E-authorities can also beautify our e-tax device by means of introducing tax comfort for the virtual 
economy. By using doing this, it may encourage Malaysian to people toward the digital financial system 
 
7.3 Limitations and Future Studies 
This has a look at has three boundaries as following:  
First, the questionnaire used in this study comprises a few technical periods that appear to be hard for apprehend via respondents. 
In destiny, the questionnaire has to layout in any such manner by way of formed of different languages including Malay and 
Mandarin to help the respondent to apprehend that means of the questions and thus Improve statistical correctness was collection. 
            Secondly, this study is restrained to the most effective one important city in Kuala Lumpur. Consequently, A summary of 
the results may not be complete. Hence, inside in the future, the have a look at other must be included fundamental urban area 
and metropolitan area consisting of Miri, Bintulu and, Kuching even to other cities in Malaysia. 
           Ultimately, this has a look at best consists of gender and schooling level because there is demographic variable. therefore, 
inside the destiny, different a demographic variable together with age and income stage ought must be included on this research 
result an extended offer knowledge of Impressive thing E-authorities and virtual economy courting 
 
7.4 Conclusion 
This vision has achieved a specific objective by determining the factors that influence electronic power and the digital economy. 
This takes a look at found out that mindset is the strongest component that has a wonderful courting to have an impact on the 
digital financial system. Then again, A virtual financial system can be inspired by different variables. Digital infrastructure located 
out to have a high-quality relationship with the digital economy, equal as fantastic courting of digital readiness with the virtual 
financial system. Digital content and services show a strong relationship with the virtual economic system. Further, it's far located 
that demographic variables including gender and education stage have no widespread relationship with E-government and digital 
economic system. 
 



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https://doi.org/10.7864/j.ctvcb59n3
https://doi.org/10.1007/BF02291575
https://ro.uow.edu.au/cgi/viewcontent.cgi?article=3253&context=smhpapers

