Open AccessThe Effect of Capital Expenditure on Local Revenue: Study In East Java Indonesia
Author(s) -
Danang Triyanto,
Setyo Tri Wahyudi,
Candra Fajri Ananda
Publication year - 2017
Publication title -
jurnal ekonomi kuantitatif terapan
Language(s) - English
Resource type - Journals
eISSN - 2303-0186
pISSN - 2301-8968
DOI - 10.24843/jekt.2017.v10.i02.p04
Subject(s) - decentralization , gross domestic product , revenue , capital expenditure , economics , capital consumption allowance , capital (architecture) , java , local government , business , capital formation , economic growth , finance , financial capital , market economy , geography , human capital , archaeology , computer science , programming language
In the decentralization era, local independence is the logic consequence of the implementation of fiscal decentralization. Further, fiscal decentralization has potentially to increase economic efficiency of the local government if compared with the central government. This research analyzed the effect of capital expenditure through Regional Gross Domestic Product (RGDP) on Local Revenue. The sample in this study was 38 districts/ cities in East Java province in Indonesia using path analysis. The results showed some findings, first, capital expenditures which divided into productive capital expenditures and less productive capital expenditures has affect on regional gross domestic product. Second, regional gross domestic product has affects on the forming components of local revenue. Furthermore, less productive capital expenditures and productive capital expenditures have indirect effect on local revenue through regional gross domestic product.