The Effect of Original Local Government Revenue, General Allocation Fund, and Specific Allocation Fund on Economic Growth with Capital Expenditures as a Moderating Variable in Regencies and Cities in North Sumatra Province

Abstract

This study aims to determine the effect of Regional Original Revenue (PAD), General Allocation Funds (DAU), and Special Allocation Funds (DAK) on economic growth with capital expenditure as moderating variables in regencies/cities in North Sumatra Province. This type of research is causal associative. The population of this study is all regency/city governments in North Sumatra Province, totaling 33 districts and cities consisting of 25 districts and eight cities. The sample was chosen using the saturated sample method using all 33 regencies/city research populations from 2011-2020. So the number of research samples is 330 samples. Data analysis methods use multiple linear regression and residual tests. This study's results indicate that PAD, DAU, and DAK simultaneously significantly influence economic growth in regencies/cities in North Sumatra Province. The PAD and DAU variables significantly positively affect economic growth in the regencies/cities in the province of North Sumatra. In contrast, the DAK variable partially has a significant negative effect on economic growth in the regencies/cities in the province of North Sumatra. Variable Capital Expenditures as Moderating Variables can moderate relationships Between PAD, DAU, and DAK to economic growth in regencies/cities in North Sumatra Province. Keywords: Regional Original Revenue (PAD), General Allocation Funds (DAU), Specific Allocation Funds (DAK), Economic Growth, and Capital Expenditures .