Consequently, digitalization has not only failed to organically connect the four layers of Indonesia's economy but has, in some instances, intensified the disjunctures between them. The result is a stratified system wherein:
Layer 1 remains materially productive but digitally invisible.
Layer 2 remains structurally embedded but technologically obsolete.
Layer 3 thrives on hyper-visibility and platform incentives.
Layer 4 begins to influence credit allocation, logistics optimization, and even labor sorting---yet based on partial data from only a fraction of the economy.
This paradox compels a rethinking of digital transformation as not merely a technological upgrade, but as a deeply political and relational process---one that can entrench inequality if not deliberately governed. Without addressing the socio-technical disjunctions between these layers, digitalization risks becoming a centrifugal force, pulling economic actors further apart rather than weaving them into a coherent, inclusive system.
C. Research Objective: Proposing the 4-Layer Asymmetric Economy Model
The principal objective of this paper is to articulate and substantiate a novel analytical framework---the 4-Layer Asymmetric Economy Model---which captures the complex co-existence, selective interconnectivity, and dynamic mobility of Indonesia's stratified economic landscape. Specifically, this model aims to:
1. Describe and Differentiate
 -- Precisely delineate the four economic layers---Traditional (Layer 1), Industrial-Modern (Layer 2), Digital Platform (Layer 3), and AI-Augmented (Layer 4)---in terms of their structural characteristics, modes of transaction, and socio-technical configurations.
2. Explain Fragmentation Dynamics
 -- Theorize why and how these layers persist in parallel rather than in a unilinear progression, identifying the socio-technical, institutional, and cultural mechanisms that reinforce horizontal segmentation.
3. Illuminate Novel Aspects of Stratification
 -- Introduce and operationalize four original dimensions of analysis---Non-Linear Segmentation, Cross-Layer Equity, AI-Invisibility Trap, and Adaptive Stratification---to capture phenomena unaddressed by extant theories such as Lewis's dual economy or standard digitalization narratives.
4. Bridge Theory and Practice
 -- Ground the framework in empirical observation (e.g., field data from peri-urban Tangerang) to demonstrate the model's applicability for diagnosing real-world production efficiencies, wage outcomes, and market access bottlenecks across layers.
5. Inform Policy and Strategy
 -- Generate actionable policy guidelines for fostering productive inter-layer linkages---ensuring decent work, fair wages, and accessible markets---without coercive "upgrading" mandates or one-size-fits-all digital interventions.
6. Guide Future Research
 -- Provide a conceptual roadmap for scholars and practitioners to test, refine, and extend the 4-Layer Asymmetric Economy Model in other regional contexts or comparative settings.
By meeting these objectives, the paper will offer a comprehensive lens for understanding and addressing the paradoxes of economic stratification in Indonesia---where productivity, dignity, and inclusion demand a framework that is both layer-sensitive and adaptively integrative.
2. Literature Review
A. Foundational Theories: Lewis, De Soto, Sen, and Sociotechnical Perspectives
The conceptual basis of this paper is situated at the intersection of four major theoretical strands---Lewis's Dual Economy Theory, De Soto's Extralegal Economy, Sen's Capability Approach, and Sociotechnical Systems Theory---each offering distinct yet complementary lenses to analyze the layered economic landscape of contemporary Indonesia.
1. Lewis's Dual Economy Theory (1954)
W. Arthur Lewis's seminal contribution distinguishes between a traditional subsistence sector and a modern capitalist sector, positing that economic development involves the gradual migration of labor from the former to the latter. This model was foundational in development economics, providing a framework to understand structural transformation.
While influential, the Lewis model tends to assume a vertical integration trajectory and fails to account for persistent horizontal fragmentation across coexisting economic layers. In the Indonesian case, the informal sector is not merely a labor surplus reservoir waiting to be absorbed by modern industry; rather, it has become a dynamic and resilient domain, often disconnected from formal industrial and digital systems. Moreover, the Lewis model presumes that technological progress will naturally bridge sectors, an assumption increasingly challenged by platform-induced segmentation and AI-mediated exclusions.
