Is Fiscal Decentralization Conflict Abating? Routine Violence and District Level Government in Java, Indonesia

Abstract

Utilizing a newly created data set the authors examine the relationship between routine/everyday violence and fiscal decentralization in 98 districts of the Indonesian island of Java. By examining possible relationships between fiscal decentralization and routine violence, this paper fills a gap in the literature where the analysis of the relation between fiscal decentralization and violence is relatively scant. Routine violence, which is different from both civil war and ethno-communal conflict, centres around group brawls, popular justice or vigilante violence. Despite the uniform implementation of fiscal decentralization, subnational entities exhibit varying experiences with decentralization, but a common consequence is the increased size of local government. Fiscal decentralization, and the increased size of local government, can alleviate pent-up frustrations with a centralized state, as local government expenditure is seen to satisfy the needs of communities with which people identify more closely. The authors also find that the greater the share of locally generated revenues, the lower the number of violent incidents; but this capacity to generate more local revenues mainly lies in richer districts. Therefore, richer districts are likely to have a lower incidence of violence.

Does Fiscal Decentralization Good For Reducing Communal Conflict?

“…By analyzing the association of decentralization and communal conflict until Indonesia's lowest administrative tier (village Desa and neighborhood Kelurahan), this study reveals the effect of decentralization on the most prone areas to communal conflicts. Second, this study differs from some of the prior studies which used only limited geographical coverage [15,20]. By using larger coverage of districts and municipalities, villages and neighborhoods within whole the provinces of Indonesia, this study reveals how were communal conflicts distributed geographically in Indonesia in the period of 2008 to 2014.…”

“…First, we use national representative census about the nexus between decentralization and communal conflict by focusing on Indonesia over the period of 2008-2014. However, this study mostly differs from previous studies which only covered limited provinces and districts in Indonesia [15,20]. Since this study captures the association of decentralization and communal conflict in Indonesia, It will cover whole districts level and villages' level instead.…”

“…Some scholars found the benefit of fiscal decentralization on communal conflict argue that fiscal decentralization may reduce communal conflict. Fiscal decentralization reduces the likelihood of communal conflict by increasing level of allocative efficiency and the share of locally generated revenue [15,18,21].…”

“…Second, some of the prior studies used limited geographical coverage. For example, in [15], Murshed, Tadjoeddin, and Chowdory (2009) study only covered districts within Java Island, and therefore findings could only be generalized within communal conflicts across districts in this Island.…”

“…Some prior studies found that fiscal decentralization is good reducing communal violence due to domestic terrors, routine acts of violence and communal conflicts [14,15,16]. Murshed, Tadjoeddin, and Chowdhury (2009) found that Fiscal decentralization could reduce the tension of communal conflict due to a mechanism that fiscal decentralization may satisfy the needs of local communities with which people identify more closely in local level rather than centralized policy [15]. Tranchant (2008) found Fiscal decentralization could reduce the likelihood of conflict by strengthening bureaucratic quality [16].…”