It takes two to Tango: The joint effect of democracy and fiscal capacity on economic growth in Indonesia

Jamil, Hidsal; Ananda, Candra Fajri; Prasetyia, Ferry

doi:10.22437/ppd.v10i5.20816

Cited by 3 publications

(3 citation statements)

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“…The argumentation of this paper is rather circular. The scope is the community empowerment that is dependent on regulation, but the paper identifies the culture of reglomania (gila peraturan) (Gilbert, 1991) as a key inhibiter of empowerment and the need for it to change in order to regulate for the green economy. This leads to identifying a set of problems with legislation, including a failure to identify the real public service given by effective regulation.…”

Section: Methodsmentioning

confidence: 99%

Unleashing Community Empowerment through A New Regional Autonomy Concept in the 2024 Elections

Podger

2023

JISCOS

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Long-term planning in all regions in Indonesia in 2025 provides a powerful opportunity to commit governments to community empowerment, an opportunity dependent on the intention of those who are elected to power in the 2024 elections, and their commitment to stress sustainable economic development in those long-term plans, and the regulations to implement the plan. As the culture of reglomania (gila peraturan) is a key inhibiter of empowerment there is a need to change that culture to one that empowers and directs development of the green economy. This paper identifies problems with legislation, including a failure to identify the public service of creating an ordered environment for community development, including regulations for economic linkages and collaboration while providing for diversity. This leads to a reconsideration of the role of provinces, further consideration of accessibility and management of land, and integrity in government. The paper concludes with changes needed in campaigning in 2024 in order to lay the foundation for medium-term and long-term plans for building community empowerment after the elections, and provides a set of recommendations.

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Section: Methodsmentioning

confidence: 99%

Unleashing Community Empowerment through A New Regional Autonomy Concept in the 2024 Elections

Podger

2023

JISCOS

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“…A research gap lies in the limited existing literature specifically analysing the influence of regional fiscal capacity on the convergence of inclusive economic development across the 34 provinces of Indonesia. While there have been studies on fiscal decentralisation and its impact on economic growth (Aprianti & Sulindrina, 2023;Baskaran & Feld, 2013;Canavire-Bacarreza et al, 2020;Jamil et al, 2022;Lamba et al, 2019), there is a necessity to further investigate the relationship between regional fiscal capacity and the convergence of inclusive economic development. This research analyses the influence of regional fiscal capacity on the convergence of inclusive economic development across 34 provinces in Indonesia.…”

Section: Introductionmentioning

confidence: 99%

Exploring the Nexus between Regional Fiscal Capacity and the Convergence of Inclusive Economic Development

Sakti,

Bintoro,

Setyanti

et al. 2024

jcgpp

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In the fiscal decentralisation system, the establishment of fiscal capacity is of paramount importance as local governments must be capable of effectively managing their own financial resources to meet the needs of the local population and advance regional development. Possessing a robust fiscal capacity enables local governments to be more effective in enhancing regional economic growth. This study analyses the influence of regional fiscal capacity on the convergence of inclusive economic development across 34 provinces in Indonesia. Conditional beta convergence analysis is employed on the Inclusive Economic Development Index, which is influenced by the degree of fiscal decentralisation, local financial autonomy, effectiveness of local own-source revenue, indirect expenditure ratio and direct expenditure ratio. This study provides valuable insights revealing visible convergence trends among Indonesia’s 34 provinces indicating crucial progress in achieving inclusive economic development and eliminating inequality. Furthermore, the observed progress underlines the vital role of fiscal capacity, particularly the levels of fiscal decentralisation and direct spending, as a significant driver encouraging a positive trajectory of economic convergence between provinces.

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“…Optimization of fiscal decentralization is not only through revenue but also through regional expenditure (Jamil et al, 2022). The allocation of local government expenditure is expected to contribute to economic development, especially poverty reduction, based on the Directorate General of Fiscal Balance data (2023), related to realizing regional expenditure based on the economic sector in each Special Region of Yogyakarta District/City.…”

Section: Introductionmentioning

confidence: 99%

The Promise of Fiscal Decentralization on the Threat of Poverty Rates in Special Region

Finuliyah,

Susilo,

Saputra

2023

JICP

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This study aims to determine the effect of the fiscal decentralization component on poverty, directly or indirectly, through pro-poor expenditures in Special Regions of Yogyakarta. The Privileges of the Special Region of Yogyakarta mentioned what distinguishes it from the other provinces so that it is called a special region is the privilege to establish a social order that guarantees diversity and the critical role of the Sultanate and Duchy of Pakualaman in preserving culture. However, poverty in the Special Region of Yogyakarta is spread in every district. On the other side, more than two decades of efforts to address poverty have been through fiscal decentralization. During the era of fiscal decentralization, there were problems from the revenue and expenditure sides. It is a question related to the successful implementation of fiscal decentralization. This study uses path analysis with secondary data. The result of this study is that the component of local revenue can play a role in poverty reduction directly through local-own source revenue. The indirectly effect shows that poverty alleviation can also be done through the role of local-own source revenue through pro-poor expenditure instruments.

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It takes two to Tango: The joint effect of democracy and fiscal capacity on economic growth in Indonesia

Cited by 3 publications

References 50 publications

Unleashing Community Empowerment through A New Regional Autonomy Concept in the 2024 Elections

Unleashing Community Empowerment through A New Regional Autonomy Concept in the 2024 Elections

Exploring the Nexus between Regional Fiscal Capacity and the Convergence of Inclusive Economic Development

The Promise of Fiscal Decentralization on the Threat of Poverty Rates in Special Region

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