Analisis Hubungan Desentralisasi Fiskal dan Pembangunan Wilayah Berkelanjutan di Indonesia

Abstract

This study aims to analiyze relationship between expenditure side fiscal decentralization and sustainable regional development across 38 provinces in Indonesia in 2014, 2019, and 2024. Sustainable regional development is measured using the Regional Sustainable Development Index (RSDI),  which include economic, social, and environmental pillars aggregated using the  geometric mean. This study uses secondary data from the Directorate General of Fiscal Balance (DJPK) of Ministry Of Finance, Statistic Indonesia (BPS), and the Ministry Of  Environment and Forestry (KLHK) The analysis uses Spearman’s rank correlation because the data are not normally distributed based on the Shapiro-wilk test. The result show that expenditure side fiscal decentralization is not signicant relationship with the economic pillars, social pillars, or RSDI across all observation periods. A consistently significant negative relationship is found between expenditure side fiscal decentralization and the environmental pillar. These finding demonsrates the existence of an ecological trade-off in the implementation of regional autonomy. The findings emphasize the importance of  implementing environmentally oriented budgeting and regional fiscal transfer incentive schemes to reduce the risk of environmental degradation resulting from development expansion.