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Implication of productive expenditures for economic growth: evidence from provincial governments across indonesia (presented at the Seminar Atma Jaya Award 2016, Unika Atma Jaya, December 2015)
Bibliografi
Author:
Sijabat, Rosdiana
Topik:
productive expenditure
;
economic growth
;
fiscal decentralization
;
panel model approach
;
JABFUNG-ABI-ROS-2017-B27
Bahasa:
(EN )
Tahun Terbit:
2015
Jenis:
Papers/Makalah - pada seminar lokal/institusi
Fulltext:
Implication of productive - Rosdiana Sijabat - text.pdf
(2.76MB;
1 download
)
Abstract
This study is intended to examine the impacts of productive expenditures on economic growth on the 25 provinces found in Indonesia before fiscal decentralization (covering 1994-1997) and 33 provinces after decentralization (covering 1994-1997). The empiric approach has been implemented through a panel data approach and regression model estimated to follow the endogenous growth model of Barro (1990). The main findings of this research show that: (1) provincial governments' productive expenditures in education promoted economic growth in the 25 pre-decentraiization provinces; and (2) productive expenditures in the security and public order sector and also education sector have promoted economic growth in the 33 post-decentralization provinces. From these results, it can be concluded that this study has contributed to economic literature by indicating that different types of productive government expenditures offer different impacts on economic growth. The policy implications which can be formulated from the results of this study are that provincial governments should promote and provide incentives for private investments in the public sector because only the education sector (before fiscal decentralization) and the security and public order sector as well as the education sector (after fiscal decentralization) have a statistically significant role in promoting economic growth. This can be realised through public-private partnership, which has greatly increased the performance of public-sector investment around the world. Future research, using relevant control variables to estimate the effects of productive expenditures on economic growth, will provide a greater empiric contribution to the literature.
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