The Influence of Regional Income on Economic Growth and its Implications for the Human Development Index in East Java

Abstract

Financing of government administration based on the principle of decentralization is carried out at the expense of the APBD. In the context of implementing government and services to the community based on the principle of decentralization, the regions are given the authority to collect taxes / levies and manage natural resources, the source of funds for the regions consists of Regional Original Revenue, General Allocation Funds, and Special Allocation Funds. This study aims to determine the effect of PAD, DAU, DAK, Village Funds and Revenue Sharing Funds on Economic Growth and its impact on the Human Development Index in East Java Province. This research was conducted using quantitative description analysis and analyzed using path analysis. The data used in this study used secondary data obtained from the financial statements of the East Java Provincial Government or the website of the East Java Provincial Government and the Regional Statistics Planning Agency of East Java Province. The results of this study indicate that PAD, DAU, DAK, Village Funds and Revenue Sharing Funds on Economic Growth in East Java Province means that there are 5 factors that can affect economic growth the higher and the value of funds obtained can increase economic growth. PAD, DAU, DAK, Village Funds and Revenue Sharing Funds affect the Human Development Index in East Java Province where the higher the value of funds obtained by the city / district area can increase the human development index in the area itself. Economic Growth affects the Human Development Index, meaning that economic growth that occurs due to economic activity in a region affects the human development index due to economic activity. PAD, DAU, DAK, Village Funds and Revenue Sharing Funds affect Economic Growth and the impact of the increase in the Human Development Index, this happens because the 5 factors that are the source of funds in each region are managed to increase economic growth and are accompanied by an increase in the human development index.