DOMINANT FACTORS AFFECTING REGIONAL EXPENDITURE AND FLYPEPPER EFFECT (original) (raw)
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Regional Expenditure: Analysis of Flypaper Effect in South Sumatera Province
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The term "regional expenditures" refers to all commitments incurred by local governments over the course of a fiscal year. Regional expenditures (RE) are a type of commitment from the central government to local governments in terms of granting the authority to regulate and manage their own government operations and the interests of the local community. RE are funded by regional generated revenue (RGR) and central government transfer payments. The inclination of local governments to limit the amount of RGR in the hopes of receiving more transfer funds from the central government is an issue in acquiring transfer payments from the central government. The flypaper effect is the name for this issue. The goal of this study is to look at the impact of the flypaper effect on RGR, general allocation funds (GAF), fiscal capability (FC), and excess budget calculation (EBC) on RE. This study relies on secondary data from Indonesia's Supreme Audit Institution. This study focuses on 14 regencies and four cities in South Sumatera. Panel data regression analysis is used in this study. The findings revealed that RGR has no impact on RE. However, GAF, FC, and EBC had an impact on RE.
Flypaper Effect on Regional Spending in Central Java Province
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Implementation of autonomy policies in the reform area aims to accelerate region growth, make Central Java Province continues to optimize their regional spending to increase their development. Purpose of this research is to determine effect of the original local government revenue and general allocation funds to regional spending and flypaper effect existence. Panel data regression and independent sample t test used as a method with 2014-2017 data from 35 districts and cities at Central Java. Result shown that there is positive and significant effect at original local government revenue and general allocation funds to regional spending. However, the construction being carried out still has a flypaper effect.
Flypaper Effect of Regional Expenditure and It's Impact to Regional Inequality in Indonesia
SIGNIFIKAN: Jurnal Ilmu Ekonomi, 2017
The primary objective of decentralization is expected to narrow down the regional gap among regions in Indonesia, which is considered as the result of a centralized development. The objective of this research is to identify the flypaper effect of regional expenditures of regency and city governments in Indonesia from 2008 until 2013. Another aim of this study is to provide an empirical evidence that the influence of regional expenditures of regencies and cities in Indonesia from 2009 until 2013 over the regional gap in Eastern and Western provinces of Indonesia. As such, it is necessary to use multiple regression analysis to examine the data. The findings of this study explicate that own-source revenue and general allocation fund significantly affect regional expenditures and a regional gap in the Eastern and Western provinces of Indonesia. Thus, it can be concluded that the dependency level of the regions upon a number of funds transferred from central government is still relativel...
Flypaper Effect in Indonesian Municipal Governments’ Expenditures
International Journal of Education and Social Science Research, 2021
This study seeks to test the flypaper effect in Indonesian municipal governments’ expenditures from 2014 to 2008 by comparing municipalities (cities/ regencies) with increasing municipal own-source revenues with those of which municipal own-source revenues decline. Our dependent variable is an increase in municipal expenditures, while the independent variables are increases in municipal ownsource revenues and unconditional grants. We analyze the panel/ pooled data by combining the 20142018 time-series data and cross-section data from several Indonesian municipalities. This study employs the panel data regression with the Fixed Effect Model. The results indicate the flypaper effect in Indonesian municipals’ expenditures, no flypaper effect in the local expenditures of municipals with continuously increasing PAD, and the flypaper effect in the local expenditures of municipals with decreasing PAD.
Flypaper Effects Anomaly Of West Papua Capital Public Expenditure
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In fiscal decentralization, local governments should be able to provide public service facilities for all communities. This study aims to determine the existence of flypaper effect in the total capital public expenditure and capital expenditure on education, health and infrastructure in districts in West Papua, 2003-2006. Tools of analysis used is panel data regression. The General Allocation Fund (DAU), the Special Allocation Fund (DAK) and the Special Autonomy Fund (DOK) partially and simultaneously have positive impact on total capital spending and capital expenditure in education, health, and infrastructure. It is also indicated the anomaly of flypaper effect in DAU, DAK, and DOK. Keywords: Flypaper effect, anomaly, fiscal decentralization, capital expenditures JEL classification numbers: H50, H75
Flypaper Effect on Regional Capability of Districts/Cities in West Nusa Tenggara
E-PROCEEDING STIE MANDALA, 2017
This research aims to provide empirical proof that (a) unconditional transfer influence the regional finance capability and local expenditure, (b) flypaper effect occurred in fiscal decentralization policy at west nusa tenggara municipalities. Transfer of funds encourage the increase in the expenditure of local goverment. Using secondary data from the local government budget realization covering the period 2001-2015, we analyzing the contributions of unconditional transfer and regional finance capability to local expenditure. The results of this research by using partial least square showed unconditional transfer has significant effect to the regional finance capability and local expenditure. Other result indicate occurrence of flypaper effect, unconditional transfer have positif and significant effect on local expenditure more than regional capability. These indicated that local government still depend on unconditional transfer to realize number of local expenditure and regional capability. The implication of this research can use as the base of local government decision making on local own revenue and intergovernmental revenue management for local expenditure on public need, as well as base judgement on financial performance of local government (agen) and public (principal).
2020
Regional autonomy is not an easy challenge, because of regional autonomy must be based on the awareness that regional autonomy is an opportunity for local government to prove its independence. This means that regional autonomy cannot be seen as a failure. The implementation of regional autonomy must be directed to accelerate the realization of community welfare through empowering roles of community and increasing regional competitiveness. Transfer funds called also balancing funds, consist of profit sharing, general allocation, and special allocation funds. In addition to the balancing funds, the regional government also has its own funding source in the form of local revenue. Policy funding of all these funds is submitted to the regional government. These balancing funds have different goals among each other. All balancing funds are channeled into regional income and expenditure budget. Therefore, the regional government must provide a responsibility to the house of representative ...
This study aims to identify the flypaper effect and the effects of financial balance transfer and Regional Own-source Revenue on regional expenditure of regencies and municipalities in East Java Province. The population of this study consists of regional expenditure data of 29 regencies and 9 municipalities in East Java Province collected by Statistics Indonesia (Biro Pusat Statistik/BPS) from 2005 to 2012. The writer conducted analysis on the data using Eviews 7. The findings of this study indicated that Regional Own-source Revenue, General Allocation Fund, and Specific Allocation Fund significantly affect regional expenditure and the flypaper effect occurs on regional expenditure of regencies and municipalities in East Java Province. This conditionis marked by regional spending as the response against the General Allocation Fund is higher than regional spending as the response against Regional Own-Source Revenue. Therefore, it can be concluded that the dependency level of the regions upon financial balance transferred from central government is still relatively high.
Archives of Business Research, 2017
The main objective of this research is to show the relationship between General Allocation Fund (DAU), Own-Source Revenue (PAD), Capital Expenditure, Economic Growth, Human Development Index (IPM), and Income per Capita of regencies/municipality in Bali. The other objective is to provide empirical evidence on the occurrence of flypaper effect in DAU and PAD on Capital Expenditure. Data is taken from audited local budget and revenue report and from Bureau of Statistic (Badan Pusat Statistik-BPS) Bali Province. Result of analysis indicates that the variable of DAU and PAD is positively related to Capital Expenditure, Capital Expenditure is positively related to Economic Growth, Capital Expenditure is negatively related to Income Per Capita, and Capital Expenditure is positively related to Human Development Index. DAU and PAD are separately influenced Capital Expenditure, but the coefficient of PAD is greater than DAU. It indicates that there is no flypaper effects occurred on Capital Expenditure. Flypaper effect is defined as local response (expenditure) that is greater than transfer. The results still require confirmation through future researches.
Testing Effect Mediation of Regional Expenditure on Gross Regional Domestic Products
Journal of Innovation in Business and Economics
This study aims to analyses and determine the dominant factors that influence regional spending and its impact on gross regional domestic products and to analyses the direct and indirect effects of regional own revenue, general allocation fund and revenue sharing fund on gross regional domestic products mediated by regional expenditure. Data uses panel data with 17 Regency / Municipality in Southeast Sulawesi and observation period for 2015-2017. Data analysis used path analysis with AMOS 18.0 program and indirect effect test using the Sobel test. The results of the study conclude: a) General Allocation Funds and Revenue Sharing Funds significantly affect Regional Expenditures, while Regional Own Revenues are insignificant; b) Regional Own Revenue and Revenue Sharing Fund significantly affect the Gross Regional Domestic Product, while the General Allocation Fund is not significant; c) Regional Expenditure significantly mediated the effect of General Allocation Funds and Revenue Shar...