Abstract
The purpose of this study was to find out and analyze: (1) To what extent does the
degree of fiscal decentralization influence economic growth in North Sumatra,
(2) To what extent does transfer dependency influence economic growth in North
Sumatra, (3) To what extent does the capital expenditure ratio influence
economic growth in North Sumatra, (4) How far is the degree of fiscal
decentralization, transfer dependence, and the ratio of capital expenditure to
economic growth in North Sumatra. The data used is panel secondary data for
33 regencies/cities in North Sumatra from 2014-2019, data obtained from
institutions related to the research variables which are grouped into two parts,
namely the dependent variable which in this study uses economic growth and the
independent variables which consist of degree of fiscal decentralization, transfer
dependency, and capital expenditure ratio. This study uses panel data regression
analysis using the fixed effect model (FEM). The results of this study indicate that
simultaneously, fiscal decentralization has a significant effect on economic
growth in North Sumatra. while partially (1) The degree of fiscal decentralization
has a negative and significant effect on economic growth (2) transfer dependence
has a positive and insignificant effect on economic growth (3) the ratio of capital
expenditure has a positive and insignificant effect on economic growth in North
Sumatra.
degree of fiscal decentralization influence economic growth in North Sumatra,
(2) To what extent does transfer dependency influence economic growth in North
Sumatra, (3) To what extent does the capital expenditure ratio influence
economic growth in North Sumatra, (4) How far is the degree of fiscal
decentralization, transfer dependence, and the ratio of capital expenditure to
economic growth in North Sumatra. The data used is panel secondary data for
33 regencies/cities in North Sumatra from 2014-2019, data obtained from
institutions related to the research variables which are grouped into two parts,
namely the dependent variable which in this study uses economic growth and the
independent variables which consist of degree of fiscal decentralization, transfer
dependency, and capital expenditure ratio. This study uses panel data regression
analysis using the fixed effect model (FEM). The results of this study indicate that
simultaneously, fiscal decentralization has a significant effect on economic
growth in North Sumatra. while partially (1) The degree of fiscal decentralization
has a negative and significant effect on economic growth (2) transfer dependence
has a positive and insignificant effect on economic growth (3) the ratio of capital
expenditure has a positive and insignificant effect on economic growth in North
Sumatra.