ECONOMIC GROWTH: IMPACT OF LOCALLY-GENERATED REVENUE AND BALANCE FUNDS MODERATED BY CAPITAL EXPENDITURE

  • Novi Yanti STIE SUMBAR
  • Nurtati Nurtati Sekolah Tinggi Ilmu Ekonomi Sumbar

Abstract

The allocation of development budget can accelerate the pace of economic growth in the implementation of fiscal decentralization. Through locally-generated revenue management and regional government, balance funds can increase their income through the use of appropriate capital expenditure however economic growth is not always linear with all sources of revenue. The purpose of this study is to analyze the effect of regional revenue and balance funds partially and simultaneously on capital expenditure and its impact on economic growth. The research method is quantitative with a longitudinal research time-series design The study was conducted in the Regency / City of West Sumatra Province with secondary data from the Central Statistics Agency in 2009-2018. Research analysis using multiple linear regression test and path analysis. The results showed that Locally-generated revenue, general, and special allocation fund partially and simultaneously have a significant effect on capital expenditure, but the profit-sharing fund partially has no significant effect on capital expenditure. Locally-generated revenue, profit-sharing funds, general and special allocation fund, and capital expenditure partially and simultaneously have a significant effect on economic growth. Likewise, capital expenditure has a positive effect on economic growth which is mediated by locally-generated revenue and special allocation funds, while capital expenditure does not significantly influence economic growth mediated by general allocation funds and profit-sharing funds

Downloads

Download data is not yet available.

References

Barata, A. (2019). Strengthening National Economic Growth And Equitable Income Through Sharia Digital Economy In Indonesia. Journal of Islamic Monetary Economics and Finance, 5(1), 145–168.
Burlon, L. (2017). Public expenditure distribution, voting, and growth. Journal of Public Economic Theory, 19(4), 789–810.
Creel, J., Hubert, P., & Labondance, F. (2015). Financial stability and economic performance. Economic Modelling, 48, 25–40.
d’Agostino, G., Dunne, J. P., & Pieroni, L. (2016). Government spending, corruption and economic growth. World Development, 84, 190–205.
Dang, G., & Pheng, L. S. (2015). Theories of economic development. In Infrastructure investments in developing economies (pp. 11–26). Springer.
Fahlevi, h., & kurniawan, y. (2017). Revenue budget variance and capital expenditure spending: empirical evidence from indonesian local governments.
Gamayuni, R. R. (2016). The effect of local government characteristics and the examination result of Indonesian supreme audit institution on economic growth, with financial performance as intervening variable in district and city government of lampung province. Research Journal of Finance and Accounting, 7(18), 119–136.
Hartwell, R. M. (2017). The industrial revolution and economic growth (Vol. 4). Taylor & Francis.
Hermawati, W. (2018). Pengaruh Belanja Modal terhadap Pertumbuhan Ekonomi pada Kabupaten/Kota di Provinsi Kalimantan Utara. Universitas Terbuka.
Karianga, H. (2016). New Paradigm for Local Financial Management: A Review of Local Budgeting System. Hasanuddin Law Review, 2(3), 398–408.
Loehlin, J. C., & Beaujean, A. A. (2016). Latent variable models: An introduction to factor, path, and structural equation analysis. Taylor & Francis.
Mutiah, R. M. (2015). The Effect of Surplus Budget Financing, Special Allocation Fund, General Allocation Fund, Regional Revenue, and Characteristics of Local Government on Decision of Capital Expenditure (Survey in Local Government in Indonesia). Research Journal of Finance and Accounting, ISSN, 1697–2222.
Putri, F. A. I. (2016). Analisis Pengaruh Belanja Modal Dan Aset Daerah Terhadap Pertumbuhan Ekonomi Di Kota Pasuruan Tahun 2005-2015. University of Muhammadiyah Malang.
Rakhyadi, R. (2019). Pengaruh Pendapatan Asli Daerah, Dana Alokasi Umum, Dana Alokasi Khusus, Dan Dana Bagi Hasil Terhadap Pertumbuhan Ekonomi Di Provinsi Aceh. Universitas Pembangunan Nasional Veteran Yogyakarta.
Shareia, B. F. (2015). Theories of development. International Journal of Language and Linguistics, 2(1), 78–90.
Wiraswasta, F., Pudjihardjo, M., & Adis, P. M. (2019). Pengaruh Dana Perimbangan Dan Pendapatan Asli Daerah (Pad) Terhadap Pertumbuhan Ekonomi Melalui Belanja Modal Di Kota Dalam Wilayah Jawa Timur (Tahun 2009-2014). Jurnal Bisnis Dan Manajemen, 5(2).
Yulihantini, D. T., & Wardayati, S. M. (2017). Financial accountability in the management of village fund allocation.
Zafar, M. W., Shahbaz, M., Hou, F., & Sinha, A. (2019). From nonrenewable to renewable energy and its impact on economic growth: the role of research & development expenditures in Asia-Pacific Economic Cooperation countries. Journal of Cleaner Production, 212, 1166–1178.
Published
2020-08-06
How to Cite
YANTI, Novi; NURTATI, Nurtati. ECONOMIC GROWTH: IMPACT OF LOCALLY-GENERATED REVENUE AND BALANCE FUNDS MODERATED BY CAPITAL EXPENDITURE. Jurnal Pembangunan Nagari, [S.l.], v. 5, n. 1, p. 40-54, aug. 2020. ISSN 2527-6387. Available at: <http://ejournal.sumbarprov.go.id/index.php/jpn/article/view/173>. Date accessed: 29 oct. 2020. doi: https://doi.org/10.30559/jpn.v5i1.173.
Section
Articles