Abstract
This research aim is to analyze local expenditure quality in East Java based on five construct variables. Each construct variables consist of 40 indicators. This research use secondary data is Local Government Management Evaluation Report each region in East Java. Data of local development use poverty, unemployment, Gini index, economic growth, GDP per capita, and Human Development Index. This research uses analysis Structural Equation Modeling. It uses to know appropriate indicators to improve spending quality. The result shows that from 40 indicators just there are 21 indicators which have reached criteria good expenditure quality. Effectively has influence to expenditure quality more than 50% to describe model variation in local expenditure quality. It means that East Java has high financial effectively in increase public service because quality expenditure increasing continuously each year.
Highlights
Development is a systematic effort and sustainable for create a condition that can provide a variety of alternatives for achieving the aspirations of every citizen (Rustiadi et al, 2011). Todaro (2006) explain that the development is seen as a multidimensional process that covers a wide range of fundamental changes on the social structure, the attitude of society and national institutions that pursue the acceleration of economic growth, overcome income inequality, and overcome poverty
Regional autonomy policy has been established that fiscal decentralization is based on the consideration that region is more aware of the needs and standards public service in the region
construct reliability (CR)> 0.6 is acceptable for exploratory research (Hair et al, 2011). These results indicate that the whole construct has value CR> 0.6
Summary
Development is a systematic effort and sustainable for create a condition that can provide a variety of alternatives for achieving the aspirations of every citizen (Rustiadi et al, 2011). Todaro (2006) explain that the development is seen as a multidimensional process that covers a wide range of fundamental changes on the social structure, the attitude of society and national institutions that pursue the acceleration of economic growth, overcome income inequality, and overcome poverty. Along with the implementation of regional autonomy and the change paradigms underlying development to the society, regional development requires a participatory approach, involving all of elements of society in the region. Implementation of regional autonomy, it means the region is given authority to manage the potential of the region in developing the potential its resources. Regional autonomy policy has been established that fiscal decentralization is based on the consideration that region is more aware of the needs and standards public service in the region. Each region is given authority and obligation to arrange the local budget (APBD). Local budget can maximize their local revenue of existing potential, spend those funds according the program and needs of the region has been set
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