Government revenue and spending nexus in regional Indonesia: Causality approach
This study aims to test the hypothesis that explains the relationship between tax revenue and government spending in six Indonesian regions. Furthermore, the units of analysis were districts and cities in each region from 2006 to 2017, and a Granger panel causality approach was used. The results sh...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Centre of Sociological Research, Szczecin, Poland
2022-05-01
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| Series: | Economics, Management and Sustainability |
| Subjects: | |
| Online Access: | https://jems.sciview.net/index.php/jems/article/view/169 |
| _version_ | 1797800024431656960 |
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| author | Ratu Eva Febriani Roosemarina Anggraini Rambe |
| author_facet | Ratu Eva Febriani Roosemarina Anggraini Rambe |
| author_sort | Ratu Eva Febriani |
| collection | DOAJ |
| description |
This study aims to test the hypothesis that explains the relationship between tax revenue and government spending in six Indonesian regions. Furthermore, the units of analysis were districts and cities in each region from 2006 to 2017, and a Granger panel causality approach was used. The results showed five experienced bidirectional causalities between tax revenues and local government spending out of the six regions, namely Java, Sumatra, Kalimantan, Sulawesi, and the Bali & Nusa Tenggara. Also, there was fiscal synchronisation in five regions, while the tax-spend hypothesis applies in the Papua & Maluku regions. Therefore, the local governments in these regions need to be careful in deciding actions related to increasing revenue. This can be achieved through the tax sector's optimisation and expenditure increment by encouraging public spending from the administration.
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| first_indexed | 2024-03-13T04:27:46Z |
| format | Article |
| id | doaj.art-5334b1339e51448da94cb190fdf3abac |
| institution | Directory Open Access Journal |
| issn | 2520-6303 |
| language | English |
| last_indexed | 2024-03-13T04:27:46Z |
| publishDate | 2022-05-01 |
| publisher | Centre of Sociological Research, Szczecin, Poland |
| record_format | Article |
| series | Economics, Management and Sustainability |
| spelling | doaj.art-5334b1339e51448da94cb190fdf3abac2023-06-19T21:47:08ZengCentre of Sociological Research, Szczecin, PolandEconomics, Management and Sustainability2520-63032022-05-017110.14254/jems.2022.7-1.3Government revenue and spending nexus in regional Indonesia: Causality approachRatu Eva Febriani0Roosemarina Anggraini Rambe1Department of Economic Development, University of Bengkulu, IndonesiaDepartment of Economic Development, University of Bengkulu, Indonesia This study aims to test the hypothesis that explains the relationship between tax revenue and government spending in six Indonesian regions. Furthermore, the units of analysis were districts and cities in each region from 2006 to 2017, and a Granger panel causality approach was used. The results showed five experienced bidirectional causalities between tax revenues and local government spending out of the six regions, namely Java, Sumatra, Kalimantan, Sulawesi, and the Bali & Nusa Tenggara. Also, there was fiscal synchronisation in five regions, while the tax-spend hypothesis applies in the Papua & Maluku regions. Therefore, the local governments in these regions need to be careful in deciding actions related to increasing revenue. This can be achieved through the tax sector's optimisation and expenditure increment by encouraging public spending from the administration. https://jems.sciview.net/index.php/jems/article/view/169fiscal synchronisation hypothesistax revenuegovernment spendinggranger panel causality |
| spellingShingle | Ratu Eva Febriani Roosemarina Anggraini Rambe Government revenue and spending nexus in regional Indonesia: Causality approach Economics, Management and Sustainability fiscal synchronisation hypothesis tax revenue government spending granger panel causality |
| title | Government revenue and spending nexus in regional Indonesia: Causality approach |
| title_full | Government revenue and spending nexus in regional Indonesia: Causality approach |
| title_fullStr | Government revenue and spending nexus in regional Indonesia: Causality approach |
| title_full_unstemmed | Government revenue and spending nexus in regional Indonesia: Causality approach |
| title_short | Government revenue and spending nexus in regional Indonesia: Causality approach |
| title_sort | government revenue and spending nexus in regional indonesia causality approach |
| topic | fiscal synchronisation hypothesis tax revenue government spending granger panel causality |
| url | https://jems.sciview.net/index.php/jems/article/view/169 |
| work_keys_str_mv | AT ratuevafebriani governmentrevenueandspendingnexusinregionalindonesiacausalityapproach AT roosemarinaanggrainirambe governmentrevenueandspendingnexusinregionalindonesiacausalityapproach |