Pengaruh Pendapatan Asli Daerah Terhadap Belanja Daerah Dan Budget Ratcheting Sebagai Variabel Moderasi

Abstract

The variables tested in this study consisted of Regional Original Income as an independent variable measured by the number of several revenue items in the Realized Budget and Regional Expenditure Report as the dependent variable measured by looking at expenditure items in the Realized Budget Report, then Budget Ratcheting as a moderating variable as measured by the Aranda model (2010). The sample in this study was conducted in 19 Regencies / Cities of West Sumatra Province in 2013 - 2017. The results of the study showed that the Local Revenue significantly affected Regional Expenditure and Budget Ratcheting as a moderating variable strengthening the relationship between Own Revenue and Regional Expenditure.

Ratcheting Effects on Regional Government Revenue and Expenditure Budgets in Indonesia

“…Research on the effect of ratchet on the budgeting of public sector organizations has been carried out in various contexts, including: Lee & Plummer (2007) on school budgets in Texas; Marlowe (2009) in the context of city government in the state of Minnesota; Abdullah & Juanita (2016) in district/city governments in Aceh; Susanto & Halim (2018) on local governments in specific budget components; Andrean & Sari (2020) in district/city governments in West Sumatra, and Arsani & Sihombing (2020) who found an asymmetric ratchet in local government budgeting. This research is a development of previous research in the context of local government by developing tests on a wider scope of local government, namely all provincial governments in Indonesia to explain the phenomenon of the ratchet effect on local government budgeting in Indonesia, not only in the revenue component, but also in the expenditure component.…”

“…In the context of budgeting, the budgeting process is prone to problems. One of them is when in the preparation of the budget there is a tendency for compilers to make decisions using current performance as a criterion in determining future targets, which is called a ratchet (Weitzman, 1980in Andrean & Sari, 2020. The ratchet will show that agency theory occurs in its implementation, agency theory explains the occurrence of an agreement between two parties, namely the party who gives the authority is called the principal and the party who receives the authority is called the agent (Halim and Abdullah, 2006).…”

“…Budget ratcheting will be seen when the executive action prepares the budget, the basis for decisions taken using current information as a criterion in achieving the next year's budget targets. Halim & Abdullah (2006in Andrean & Sari, 2020 said in their research that budget proposals containing slack like this are an illustration of the information asymmetry between the executive and the legislature.…”