ANALYSIS OF THE IMPACT OF FISCAL DECENTRALIZATION ON THE ECONOMIC GROWTH OF RIAU PROVINCE

Abstract

Fiscal decentralization and economic growth is a topic that is still hotly discussed by economists. And there are still many studies that are still being tested with various kinds of case studies with the aim of knowing the absolute results of the relationship between fiscal decentralization and economic growth in a region through the efficiency of public services. This study aims to find out how fiscal decentralization affects economic growth in Riau province in the 2014-2019 period, whether during that year fiscal decentralization has a positive or negative impact on economic growth in Riau. In an effort to achieve the goal, panel data regression is used by analyzing 12 districts and municipalities in Riau province during the 2014-2019 period. The authors get the results that regional revenue has a significant influence on economic growth in Riau, this is because the increasing provincial revenues (PAD) indicates an increase in economic growth, because the increasing provincial revenue causes an increase in added value to production in that area.