An Analysis of Financial Performance and Regional Capability Mapping in Regencies and Cities of Nusa Tenggara Barat Province (2018-2022)

Authors

DOI:

https://doi.org/10.59535/efe.v2i2.256

Keywords:

Regional Autonomy, Financial Performance, Financial Capability Map

Abstract

The successful implementation of regional autonomy is closely linked to financial performance, which serves as a key indicator in assessing the effectiveness of regional autonomy. The relatively low Local Original Revenue (PAD) in the regencies and cities of Nusa Tenggara Barat Province is attributed to limited capacity in exploring income sources compared to their potential. This study employs a descriptive quantitative approach, using secondary data sourced from the Ministry of Finance’s official portal for the years 2018-2022. The data analysis techniques used include Financial Performance Analysis, Financial Capability Index (IKK) Analysis, and the Quadrant method for mapping regional financial capability. The findings reveal that the average Independence Ratio of regencies and cities during the five-year period remains in the instructive (very low) category, with only Mataram City demonstrating a consultative (low) relationship pattern. Mataram City also exhibited the highest degree of fiscal decentralization, at 26.74%. The PAD Effectiveness Ratio is categorized as highly effective for Lombok Barat Regency, Dompu Regency, Sumbawa Barat Regency, Mataram City, and Bima City. However, regional financial performance in most districts/cities of Nusa Tenggara Barat Province from 2018 to 2022 is relatively inefficient. Six districts/cities, including Lombok Timur Regency, Mataram City, and Bima City, are categorized as having high financial capability, with an IKK above 43%. According to the Quadrant method, three districts/cities—Lombok Timur Regency, Lombok Barat Regency, and Mataram City—are positioned in Quadrant I, with a Share value greater than 12.1% and a Growth value greater than -0.6%.

Downloads

Download data is not yet available.

References

R. R. Aulia, W. Wahyunadi, and E. Agustiani, ‘The Influence of Capital Expenditures and Investment on Economic Growth in West Nusa Tenggara Province 2012-2022’, Economy and Finance Enthusiastic, vol. 2, no. 1, Art. no. 1, Mar. 2024, doi: 10.59535/efe.v2i1.188.

T. Talitha, T. Firman, and D. Hudalah, ‘Welcoming two decades of decentralization in Indonesia: a regional development perspective’, Territory, Politics, Governance, vol. 8, no. 5, pp. 690–708, Oct. 2020, doi: 10.1080/21622671.2019.1601595.

R. M. Moonti, ‘Regional Autonomy in Realizing Good Governance’, Substantive Justice International Journal of Law, vol. 2, no. 1, pp. 43–53, 2019.

A. Arifin, N. Hamzah, and M. Nasir, ‘The Influence of Original Local Government Revenue and Human Development Index on Economic Growth in Kabupaten Gowa’, Quantitative Economics and Management Studies, vol. 4, no. 5, pp. 994–1002, Aug. 2023, doi: 10.35877/454RI.qems1952.

A. E. Alfian, S. Hadi, and Ismail, ‘Mandalika Special Economic Zone and the Potential for Regional Economic Development of Central Lombok Regency through Investment’, JER, vol. 5, no. 2, Art. no. 2, Sep. 2022, doi: 10.57178/jer.v5i2.371.

N. Sari, S. Abdullah, and L. Maryasih, ‘The Effect of Fiscal Stress on Changes in Social Aid Shopping with Legislature Size as Moderating Empirical Evidence from Regency/City Governments in Sumatra’, Riset Akuntansi dan Keuangan Indonesia, vol. 7, no. 3, Art. no. 3, Apr. 2023, doi: 10.23917/reaksi.v7i3.19823.

A. David et al., ‘Understanding Local Government Digital Technology Adoption Strategies: A PRISMA Review’, Sustainability, vol. 15, no. 12, Art. no. 12, Jan. 2023, doi: 10.3390/su15129645.

K. D. Dzigbede, S. B. Gehl, and K. Willoughby, ‘Disaster Resiliency of U.S. Local Governments: Insights to Strengthen Local Response and Recovery from the COVID-19 Pandemic’, Public Administration Review, vol. 80, no. 4, pp. 634–643, 2020, doi: 10.1111/puar.13249.

S. Hasyim, S. R. Juniati, I. Noor, and K. Insan, ‘Implementation of Public Policy Regarding the Collection of Regional Taxes and Levies at the Sinjai Regency Regional Revenue Agency’, Socio-Economic and Humanistic Aspects for Township and Industry, vol. 1, no. 4, Art. no. 4, 2023, doi: 10.59535/sehati.v1i4.191.

W. Maulia, P. Basuki, and E. Salmah, ‘Analysis of Community Perspectives on the Development of Green Open Space to Support the Growth of MSMEs in Pagutan, Mataram City’, Journal of Social and Humanities, vol. 2, no. 1, Art. no. 1, Mar. 2024, doi: 10.59535/jsh.v2i1.244.

N. Salsabila, A. Daeng, A. B. Singandaru, and N. D. Poudel, ‘The Influence of Quality Work of Life, Workload, Work Stress, Lifestyle and Environment on the Productivity of the Millennial Workforce in Mataram City’, International Journal of Management Science, vol. 2, no. 1, Art. no. 1, Feb. 2024, doi: 10.59535/ijms.v2i1.223.

S. Handayani, S. Suharno, and L. S. Badriah, ‘The Effectiveness of Local Government Spending on Poverty Rate Reduction in Central Java, Indonesia’, Eko-Regional: Jurnal Pembangunan Ekonomi Wilayah, vol. 17, no. 1, 2022.

S. M. Putra, A. Manan, and T. Yuniarti, ‘Analysis of the Influence of Local Revenue Balancing Fund and Gross Regional Domestic Product on the Human Development Index in West Nusa Tenggara Province in 2008-2022’, Socio-Economic and Humanistic Aspects for Township and Industry, vol. 1, no. 3, Art. no. 3, Dec. 2023, doi: 10.59535/sehati.v1i3.155.

N. N. A. Mahitna, A. Manan, and E. Agustiani, ‘Analysis of the Financial Performance of the Regional Government of West Lombok Regency’, Socio-Economic and Humanistic Aspects for Township and Industry, vol. 1, no. 3, Art. no. 3, Dec. 2023, doi: 10.59535/sehati.v1i3.153.

L. R. de Mello, ‘Fiscal Decentralization and Intergovernmental Fiscal Relations: A Cross-Country Analysis’, World Development, vol. 28, no. 2, pp. 365–380, Feb. 2000, doi: 10.1016/S0305-750X(99)00123-0.

A. Garcia-Bernabeu, J. M. Cabello, and F. Ruiz, ‘A Multi-Criteria Reference Point Based Approach for Assessing Regional Innovation Performance in Spain’, Mathematics, vol. 8, no. 5, Art. no. 5, May 2020, doi: 10.3390/math8050797.

B. U. Paradintya and H. H. Fauzi, ‘The Effect Of Regional Financial Performance On Regional Financial Independence In The Province Of Central Java’, JOURNAL OF MANAGEMENT, ACCOUNTING, GENERAL FINANCE AND INTERNATIONAL ECONOMIC ISSUES, vol. 2, no. 1, Art. no. 1, Sep. 2022, doi: 10.55047/marginal.v2i1.386.

Mubarokah and A. Munandar, ‘Analysis of Regional Financial Management Performance and Level of Regional Independence in the Era of Regional Autonomy: Case Study of Semarang City in 2009-2013’, 1, vol. 5, no. 2, Art. no. 2, Mar. 2022, doi: 10.37275/oaijss.v5i2.112.

A. Sessu and Imaduddin, ‘Financial Ratio Analysis of Regional Revenue and Expenditure Budgets on Financial Performance in Regional Governments’, JER, vol. 5, no. 1, Art. no. 1, Mar. 2022, doi: 10.57178/jer.v5i1.280.

G. E. Putri, A. Ismaya, M. Taqi, and I. A. Hanifah, ‘Does Regional Autonomy Guarantee a Good Financial Performance?’, presented at the International Conference on Sustainability in Technological, Environmental, Law, Management, Social and Economic Matters (ICOSTELM 2022), Atlantis Press, Dec. 2023, pp. 175–189. doi: 10.2991/978-2-38476-112-8_17.

J. Liu, X. Hu, and J. Wu, ‘Fiscal decentralization, financial efficiency and upgrading the industrial structure: an empirical analysis of a spatial heterogeneity model’, Journal of Applied Statistics, vol. 44, no. 1, pp. 181–196, Jan. 2017, doi: 10.1080/02664763.2016.1252733.

J. Liu, X. Hu, and H. Tang, ‘Fiscal Decentralization and Regional Financial Efficiency: An Empirical Analysis of Spatial Durbin Model’, Discrete Dynamics in Nature and Society, vol. 2016, no. 1, p. 6597138, 2016, doi: 10.1155/2016/6597138.

D. Antoni, M. Siregar, and S. Heno, ‘Financial Capability Analysis in Central Kalimantan Province Before and After Regional Autonomy’, Journal Magister Ilmu Ekonomi Universtas Palangka Raya : GROWTH, vol. 4, no. 2, Art. no. 2, Dec. 2018, doi: 10.52300/grow.v4i2.2264.

M. Nugroho, A. Halik, and D. Arif, ‘Effect of CAMELS Ratio on Indonesia Banking Share Prices’, The Journal of Asian Finance, Economics and Business, vol. 7, no. 11, pp. 101–106, 2020, doi: 10.13106/jafeb.2020.vol7.no11.101.

M. S. Alam, M. J. Ali, A. B. Bhuiyan, M. Solaiman, and M. A. Rahman, ‘The impact of covid-19 pandemic on the economic growth in Bangladesh: a conceptual review’, American Economic & Social Review, vol. 6, no. 2, pp. 1–12, 2020.

S. Rohima, M. Riswan, Liliana, and M. K. Yusuf, ‘Mapping of Human Development Index in Regencies/City Over South Sumatera’, presented at the 5th Sriwijaya Economics, Accounting, and Business Conference (SEABC 2019), Atlantis Press, May 2020, pp. 120–126. doi: 10.2991/aebmr.k.200520.021.

J. J. Xiao and P. Bialowolski, ‘Consumer Financial Capability and Quality of Life: a Global Perspective’, Applied Research Quality Life, vol. 18, no. 1, pp. 365–391, Feb. 2023, doi: 10.1007/s11482-022-10087-3.

T. Potocki and M. Cierpiał-Wolan, ‘Factors shaping the financial capability of low-income consumers from rural regions of Poland’, International Journal of Consumer Studies, vol. 43, no. 2, pp. 187–198, 2019, doi: 10.1111/ijcs.12498.

A. H. Mashum and M. Marlina, ‘Nusantara Syariah Economy (Construction of Economic Cooperation between The Indonesian Muslim Community)’, IQTISHODUNA: Jurnal Ekonomi Islam, vol. 9, no. 2, pp. 197–224, Oct. 2020, doi: 10.36835/iqtishoduna.v9i2.490.

H. Hasim, M. Mediaty, and A. I. Anwar, ‘Implementing Accrual-Based SAP and Promoting Good Financial Governance More Effectively in South Buton Regency’, Journal of Social and Humanities, vol. 1, no. 2, Art. no. 2, Sep. 2023, doi: 10.59535/jsh.v1i2.107.

M. D. Arkaanjani, ‘The Influence of Poverty Levels, GRDP Per Capita and Number of Schools on School Enrollment Rates in West Nusa Tenggara Province’, Socio-Economic and Humanistic Aspects for Township and Industry, vol. 1, no. 2, Art. no. 2, Nov. 2023, doi: 10.59535/sehati.v1i2.136.

S. Amar and I. Pratama, ‘Exploring the link between income inequality, poverty reduction and economic growth: An ASEAN perspective’, International Journal of Innovation, Creativity and Change, vol. 11, no. 2, pp. 24–41, 2020.

I. Rudiarto, R. Hidayani, and M. Fisher, ‘The bilocal migrant: Economic drivers of mobility across the rural-urban interface in Central Java, Indonesia’, Journal of Rural Studies, vol. 74, pp. 96–110, Feb. 2020, doi: 10.1016/j.jrurstud.2019.12.009.

M. Malinowski and J. Smoluk-Sikorska, ‘Spatial Relations between the Standards of Living and the Financial Capacity of Polish District-Level Local Government’, Sustainability, vol. 12, no. 5, Art. no. 5, Jan. 2020, doi: 10.3390/su12051825.

Downloads

Published

2024-09-21

How to Cite

Sadaruddin, S., Abdul Manan, Siti Sriningsih, Driss Tsouli, Samuel Asuamah Yeboah, Bazira Bigawa Abel, Mohammed Ahmar Uddin, Farid Ahmad, & Falah Abdul Redha Al Kharassani. (2024). An Analysis of Financial Performance and Regional Capability Mapping in Regencies and Cities of Nusa Tenggara Barat Province (2018-2022). Economy and Finance Enthusiastic, 2(2), 83–98. https://doi.org/10.59535/efe.v2i2.256