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All Journal ProTVF Mandala: Jurnal Ilmu Hubungan Internasional Andalas Journal of International Studies Martabe : Jurnal Pengabdian Kepada Masyarakat Jurnal Madani Turast: Jurnal Penelitian dan Pengabdian Randwick International of Social Science Journal Journal of Tourism Economics and Policy Jurnal Pertahanan dan Bela Negara Jurnal Impresi Indonesia AMMA : Jurnal Pengabdian Masyarakat Jurnal Pengabdian Masyarakat Mandira Cendikia (JPKM-MC)
Syahrul Salam
Univeristas Pembangunan Nasional Veteran Jakarta
Religion Agriculture, Biological Sciences & Forestry Arts Humanities Chemistry Computer Science & IT Decision Sciences, Operations Research & Management Economics, Econometrics & Finance Education Languange, Linguistic, Communication & Media Law, Crime, Criminology & Criminal Justice Materials Science & Nanotechnology Nursing Public Health Social Sciences Other

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The Multiplier Mirage: The Political Economy of Public Procurement And Fiscal Centralization in Indonesia’s 2026 State Budget Syahrul Salam
Journal of Tourism Economics and Policy Vol. 6 No. 3 (2026): Journal of Tourism Economics and Policy (July – September 2026) - In Press
Publisher : PT Keberlanjutan Strategis Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.38142/jtep.v6i3.2088

Abstract

The 2026 Indonesian State Budget (APBN) represents a profound paradigm shift in the nation’s fiscal strategy, departing from two decades of progressive decentralization in favor of a highly centralized, front-loaded expenditure model. This pivot is primarily operationalized through two massive socioeconomic initiatives: the Free Nutritious Meal (Makan Bergizi Gratis – MBG) program and the consolidation of subsidized goods distribution via the Red and White Village Cooperatives (Koperasi Desa Merah Putih – KDMP). Grounded in the theoretical promise of leveraging the demographic dividend to maximize government spending multipliers, these programs aim to stimulate regional economies and mitigate deflationary pressures inherited from early 2025. However, early implementation reveals a macroeconomic paradox: unprecedented state expenditure coexisting with stagnant domestic aggregate demand and regional liquidity starvation. This paper utilizes a political economy framework to analyze this discrepancy, conceptualized here as the "multiplier mirage." By examining the mechanisms of public procurement, this study identifies severe institutional bottlenecks characterized by both active waste (rent-seeking and opaque vendor appointments) and passive waste (administrative centralization and supply chain monopolization). Anchored in foundational literature on fiscal multipliers in developing nations and the mechanics of state clientelism, the analysis concludes that bypassing transparent e-procurement systems and crowding out local agricultural supply chains effectively extracts wealth from the regions rather than stimulating them. The paper argues that without immediate structural reforms—specifically, mandatory open electronic contracting and the enforcement of localized sourcing quotas—the intended fiscal stimulus will continue to be intercepted by systemic inefficiencies, ultimately jeopardizing Indonesia’s macroeconomic stability.
Co-Authors Aan Setiadarma Abdullah Arif Agung Ayu Utami, Rahmadini Ali Zafir Talmullah Ali Zhafir Talmullah Bhayu Akoso, Dimas Diah Fatma Sjoraida Fian Trinugraha Hasna’ Zahidahni Hamidah Mansur Juned Mohamad Hery Saripudin Nurfarah Nidatya Nurmasari Situmeang Putri, Melisa Triatika Putri R. Maisa Yudono Rafika Rafika Rahmadini Agung Ayu Utami Rahmadini Agung Ayu Utami Rahmadini Agung Ayu Utami Rahmadini Ayu Agung Utami Rizky Hikmawan Setiadarma, Aan Shanti Darmastuti Sindy Yulia Putri Siti Maryam Sophiana Widiastutie Suprapto, Deddy Sutiono, Pribadi Syifa Humaira Amani Talmullah, Ali Zhafir Utami, Rahmadini Agung Ayu Wahyuningratna, Ratu Nadya Yuliani Widianingsih Zhafir Talmullah, Ali