| ID | 179134 |
| Title Proper | Intergovernmental Transfers in Indonesia |
| Other Title Information | the Risk Sharing Effect of Dana Alokasi Umum |
| Language | ENG |
| Author | Junichiro Takahata, Teguh Dartanto, Khoirunurrofik Khoirunurrofik ; Takahata, Junichiro ; Khoirunurrofik, Khoirunurrofik ; Dartanto, Teguh |
| Summary / Abstract (Note) | Given that most local governments in Indonesia depend heavily on intergovernmental transfers, this study tries to examine whether Dana Alokasi Umum (DAU, or general allocation fund) is able to absorb a revenue shock from the fluctuation of Pendapatan Asli Daerah (PAD, or local government revenue). The results suggest that DAU does, in fact, absorb around 83 per cent of the revenue shock. This share is greater than the compensation rate determined by the allocation formula employed in the Indonesian intergovernmental transfers system set annually by the Directorate General of Fiscal Balance, Ministry of Finance. Once the differences among local government levels are considered, it is found that DAU covers PAD decrease across all levels of local government throughout the country, but the extent of coverage depends on a number of criteria. |
| `In' analytical Note | Journal of Southeast Asian Economies (ASEAN Economic Bulletin Change the Name ) Vol. 38, No.1; Apr 2021: p.81-99 |
| Journal Source | Journal of Southeast Asian Economies (ASEAN Economic Bulletin Change the Name ) 2021-04 38, 1 |
| Key Words | Indonesia ; Intergovernmental Transfers ; Alokasi Umum |