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All Journal Journal of Indonesian Applied Economics Jurnal Ekonomi Pembangunan: Kajian Masalah Ekonomi dan Pembangunan Jurnal Ilmu Ekonomi dan Pembangunan Journal of Contemporary Governance and Public Policy Indonesian Journal of Multidisciplinary Science Journal of International Conference Proceedings Jurnal Penelitian Pendidikan Indonesia
Rachmad Kresna Sakti
Fakultas Ekonomi Dan Bisnis Universitas Brawijaya
Humanities Decision Sciences, Operations Research & Management Economics, Econometrics & Finance Education Electrical & Electronics Engineering Engineering Environmental Science Industrial & Manufacturing Engineering Languange, Linguistic, Communication & Media Law, Crime, Criminology & Criminal Justice Library & Information Science Mathematics Public Health Social Sciences Other

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Exploring the Nexus between Regional Fiscal Capacity and the Convergence of Inclusive Economic Development Rachmad Kresna Sakti; Nugroho Suryo Bintoro; Axellina Muara Setyanti; Rahayu Anzelina Agustin
Journal of Contemporary Governance and Public Policy Vol. 5 No. 1 (2024): (April 2024)
Publisher : Pusat Penelitian Ilmu Sosial dan Humaniora Kontemporer, Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.46507/jcgpp.v5i1.261

Abstract

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.
Co-Authors Agus Suman Amalia Rahmawati Aura Vedareni Maudita Axellina Muara Setyanti Axellina Muara Setyanti Daud Duli Deni Sarjoko Eddy Suprapto Hadira Thumaninah Jibril M. Pudjihardjo Ma'rufa Khotiawan Maryunani Moh. Khusaini Nugroho Suryo Bintoro Nur Farida Rahayu Anzelina Agustin Setyo Tri Wahyudi Setyo Tri Wahyudi Susilo Susilo Vina Kurniawati