Connection fiscal decentralization and poverty in South Sulawesi: Analysis of the 2004–2024 period

Ihsan Ashari; Tuti Adi  Tama; Dwi Hastuti Lestari Komarlina

doi:10.55942/pssj.v6i2.844

Authors

Ihsan Ashari Universitas Siliwangi
Tuti Adi Tama Universitas Siliwangi
Dwi Hastuti Lestari Komarlina Universitas Siliwangi

DOI:

https://doi.org/10.55942/pssj.v6i2.844

Keywords:

fiscal decentralization, poverty, economic growth, general allocation fund, special allocation fund, revenue sharing fund, local own-source revenue

Abstract

This study highlights both direct and indirect linkages mediated by economic growth, as it investigates the effects of fiscal decentralization on poverty levels in South Sulawesi Province between 2004 and 2024. The General Allocation Fund (DAU), Special Allocation Fund (DAK), Revenue Sharing Fund (DBH), and Local Own-Source Revenue (PAD) are the four main fiscal mechanisms that are the focus of this study. Using route analysis with time-series data in SPSS, this study reveals several important findings. Poverty levels are significantly negatively impacted by economic growth. As a mediating variable, DAU shows a strong positive relationship with poverty, but DAK and PAD show notable negative relationships. DBH, on the other hand, does not demonstrate a noteworthy indirect impact on poverty via the conduit of economic expansion. The findings suggest that the efficacy of fiscal decentralization in alleviating poverty varies among different fiscal instruments, with DAK and PAD yielding the most beneficial results when implemented in programs that foster economic growth. These insights provide critical guidance for policymakers aiming to enhance the effectiveness of fiscal decentralization strategies in combating poverty in South Sulawesi Province.

Author Biographies

Ihsan Ashari, Universitas Siliwangi

Ihsan Ashari is currently serving as a Regional Economic Planner with a focus on developing strategic policies to enhance regional economic growth. He is affiliated with a leading economic research institution and possesses expertise in econometrics, data analysis, and sustainable development. His relevant research contributions include studies on regional economic disparities and innovative strategies for sustainable economic growth in Indonesia.

Tuti Adi Tama, Universitas Siliwangi

Tuti Adi Tama is a lecturer at the Faculty of Islamic Studies, where she teaches Macroeconomics, Sharia Development Economics, Statistics, and the Indonesian Economy. Her area of expertise lies in the integration of Islamic economic principles within the context of macroeconomic theory. In her teaching, Tuti helps students understand economic theory in a way that aligns with Islamic values, providing a unique and relevant perspective in contemporary economics learning. Her professional contributions include developing curricula that emphasize the application of Islamic economics in various aspects of economic life.

Dwi Hastuti Lestari Komarlina, Universitas Siliwangi

Dwi Hastuti Lestari Komarlina is an active lecturer specializing in econometrics and statistics within the field of economics. She effectively combines theoretical knowledge with practical applications, enabling students to understand the use of econometric methods in economic data analysis. Her courses are essential as they equip students with the necessary skills to analyze data and make evidence-based inferences. Dwi often incorporates real-world case studies and data into her teaching, allowing students to appreciate the relevance of the theories in practical contexts. Additionally, her research focuses on the application of statistical and econometric methods to development issues, enriching the learning experience for her students. Through her contributions, Dwi plays a significant role in enhancing the competencies of her students in these critical areas.

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