Electoral Accountability, Fiscal Decentralization and Service Delivery in Indonesia

56 Pages Posted: 20 Apr 2016

See all articles by Emmanuel Skoufias

Emmanuel Skoufias

World Bank

Ambar Narayan

World Bank, Poverty Global Practice

Basab Dasgupta

World Bank

Kai Kaiser

World Bank - Indonesia Resident Mission

Date Written: March 1, 2011

Abstract

This paper takes advantage of the exogenous phasing of direct elections in districts and applies the double difference estimator to: (i) measure impacts on the pattern of public spending and revenue generation at the district level; and (ii) investigate the heterogeneity of the impacts on public spending. The authors confirm that the electoral reforms had positive effects on district expenditures and these effects were mainly due to the increases in expenditures in the districts outside Java and Bali and the changes in expenditures brought about by non-incumbents elected in the districts. Electoral reforms also led to higher revenue generation from own sources and to higher budget surplus. Finally, the analysis finds that in anticipation of the forthcoming direct elections, district governments tend to have higher current expenditures on public works.

Keywords: Subnational Economic Development, Public Sector Expenditure Policy, Parliamentary Government, E-Government, Debt Markets

Suggested Citation

Skoufias, Emmanuel and Narayan, Ambar and Dasgupta, Basab and Kaiser, Kai, Electoral Accountability, Fiscal Decentralization and Service Delivery in Indonesia (March 1, 2011). World Bank Policy Research Working Paper No. 5614. Available at SSRN: https://ssrn.com/abstract=1799161

Emmanuel Skoufias (Contact Author)

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Ambar Narayan

World Bank, Poverty Global Practice ( email )

1818 H Street, NW
Washington, DC 20433
United States

Basab Dasgupta

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Kai Kaiser

World Bank - Indonesia Resident Mission ( email )

JI. Jenderal Sudirman Kav. 52-53
Jakarta 12190
Indonesia

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