Based on an Examination of the Effect of Flypaper on Regional Expenditures, the Region has Achieved Financial Independence

Abstract

This article investigates the impact of Regional Original Income (ROI), Generally Allocate Funding (GAF), and Specially Allocate Funding (SAF) on Regionally Expenditure (RE), as well as the implications for the amount of regional financial independence. The data used is the Budget Realization Report (BRR) in the district/city government financial statements of South Sumatra Province. The saturated sampling approach of 85 observation units were used, the population is BRR for five years in seventeen regencies/cities. ROI has a large influence on local spending, GAF has no and no significant influence on local spending, and ROI, GAF, and SAF all have an effect on RE at the same time. ROI, GAF, SAF, and RE all have an impact on the region financiing authonomy. ROI, GAF, SAF, and RE all have an impact on and the incidence of the flypaper impact on RE in the regency/city of South Sumatra Province. Furthermore, enhancing ROI may help the government overcome obstacles and prevent the flypaper effect.