Capital Expenditure, Social Expenditure and Economic Growth Versus Poverty Level: A Study in North Maluku, Indonesia

Abstract

Purpose: The following were the objectives of this study: 1. To determine the effects of capital expenditures on the poverty rate in Ternate City; 2. To determine the effects of social spending on the poverty rate in Ternate City; 3. To determine the effects of economic expansion on the poverty rate in the town of Ternate; and 4. To determine the combined effects of social spending, economic expansion, and capital expenditure on the poverty rate in the town of Ternate. Design/methodology/approach: The data used in this study are secondary data relevant to this study, including poverty and economic growth data obtained from the Agency. Central statistics for the city of Ternate and APBD data obtained from the BPKAD Office. And the data used in the PDBA is public expenditure data under the framework of capital expenditure and social spending officially published by the agency. The relationship between two or more variables is examined in this study using the well-established method of regression analysis. The dependent variable (poverty) and the independent variable (capital expenditure, social expenditure, and economic growth) are the two groups that comprise the studied variables. Findings: According to the findings of this study, negative behavior has a significant and negative impact on poverty. Partially capital expenditure has a positive but insignificant effect; social spending has a negative but insignificant effect; and economic growth has a negative effect. .Additionally, social spending, economic expansion, and capital expenditure alone have no effect on the poverty rate in Ternate City. Research, Practical & Social implications: It was found that the capital expenditure factor has an effect on the level of poverty, social spending has an effect on the level of poverty and the poverty rate in the city of Ternate is influenced by economic growth. Originality/value: This article is an academic contribution that enables understanding of the research developed and focuses on capital spending, social spending and poverty rates on economic growth, considering data from several reference research databases.