DRIVERS OF REGIONAL DIGITAL DIVIDE IN UZBEKISTAN AND MECHANISMS FOR EXPANDING MARKET INTEGRATION OF SMALL BUSINESS ENTITIES

Аннотация

Rapid digitalization has raised national aggregates but may conceal territorial inequality that limits the participation of provincial small businesses in electronic commerce. This study examines the regional digital divide in Uzbekistan and mechanisms for expanding the market integration of small business entities. Three official datasets of the National Statistics Committee were combined: annual gross value added of the information economy and e-commerce for 2015– 2024, average nominal wages in information and communication and individual internet subscribers per 100 population for 14 administrative entities for 2015–2025. Spatial disparity indicators, correlation analysis, convergence tests and an ordinary least squares model of log gross value added on log internet density and log information-sector wages were applied. National gross value added grew 15.5-fold to 60,219.5 billion soums. Inequality in internet density fell sharply, with the coefficient of variation declining from 0.79 to 0.32, yet Tashkent city retained 168.2 subscribers per 100 people against 61.8 in Surkhandarya and 70.7 in Namangan, and wage dispersion outside the capital did not narrow. The national regression explained 99.0 percent of variation; the wage elasticity was 1.55 and significant, whereas internet density was individually insignificant because of severe multicollinearity, and first-difference estimates were weak. The evidence indicates comovement rather than causation, and the hypothesis on regional integration could be examined only through proxies because regional small business sales data were unavailable. Four policy mechanisms are proposed: targeted regional broadband subsidies with cloud logistics hubs, tax incentives for regional information technology outsourcing, cooperative digital storefronts, and microfinance with digital literacy vouchers.