A Note on the Indonesian Sub-National Government Surplus, 2001-2006

The Indonesian government has devolved significant expenditure authority to sub-national units since 2001. New sub-national government expenditure assignments have been paid for by a substantial increase in intergovernmental transfers to lower levels of government. The center has decided against devolving any significant new tax authority to the regions, at least for the time being. This note examines some fundamental issues related to these unspent funds. The paper has two particular objectives. First, the paper describes the basic features of sub-national government surplus and reserves since decentralization, including their size and spatial distribution. Second, it seeks to explain the observed variation in surplus across sub-national governments, according to some standard hypotheses. The paper proceeds as follows. First, some basic information regarding the buildup and geographic distribution of sub-national reserves is offered. Second, the methodological approach to the study of sub-national government surpluses is detailed. Third, the results of the econometric examination are presented and discussed. Finally, the note closes with a summary of the main findings and a proposal for some additional research that might be useful in the continuing development of central policy in this area.

Bibliographic Details

Main Author:	Lewis, Blane D.
Format:	Report biblioteca
Language:	English en_US
Published:	World Bank, Washington, DC 2008-01
Subjects:	ALLOCATION FORMULA, BANK DEPOSITS, BLOCK GRANTS, CAPITAL EXPENDITURE, CAPITAL SPENDING, CASH BALANCES, CASH RESERVES, CENTRAL GOVERNMENT, CENTRAL POLICY, CERTIFICATES OF DEPOSIT, COEFFICIENTS, COMMERCIAL BANKS, CONSUMER PRICE INDEX, CORRUPTION, DECENTRALIZATION, DISTRICTS, ECONOMIC ACTIVITY, EXPENDITURE, EXPENDITURE ASSIGNMENTS, EXPENDITURE NEED, EXPENDITURE NEEDS, FEDERAL GRANT, FINANCIAL INSTRUMENTS, FISCAL CRISIS, FISCAL NEEDS, FISCAL OUTCOMES, FISCAL SYSTEM, FISCAL TRANSFERS, GOVERNMENT BANK, GOVERNMENT BUDGET, GOVERNMENT SAVINGS, GOVERNMENT SPENDING, INSTRUMENT, INTERGOVERNMENTAL TRANSFERS, INTERNATIONAL DEVELOPMENT, ISSUANCE, LEVEL OF TRANSFERS, LEVELS OF GOVERNMENT, LOCAL FISCAL CRISIS, LOCAL GOVERNMENT, LOCAL GOVERNMENT SPENDING, LOCAL GOVERNMENTS, MINIMUM WAGE, MINIMUM WAGES, MINISTRY OF FINANCE, NATIONAL BUDGET, NATIONAL BUDGETS, NATIONAL REVENUES, OIL PRICE, POLICY DISCUSSION, PROVINCE, PROVINCES, PROVINCIAL GOVERNMENT, PROVINCIAL GOVERNMENTS, PROVINCIAL LEVEL, PROVINCIAL POPULATION, PUBLIC SERVICES, PUBLIC SPENDING, REGIONAL GOVERNMENTS, RESERVE, RESERVE FUNDS, REVENUE ASSIGNMENTS, REVENUE SHARING, RURAL BANKS, SERVICE DELIVERY, STATE BUDGET, SUB-NATIONAL, SUB-NATIONAL EXPENDITURE, SUB-NATIONAL EXPENDITURES, SUB-NATIONAL GOVERNMENT, SUB-NATIONAL GOVERNMENT EXPENDITURE, SUB-NATIONAL GOVERNMENTS, SUB-NATIONAL UNITS, SUBNATIONAL, SUBNATIONAL GOVERNMENT, SUBNATIONAL GOVERNMENTS, TAX, TAX AUTHORITY, TAX REVENUES, TREASURIES, URBAN AREAS, URBANIZATION,
Online Access:	http://documents.worldbank.org/curated/en/273761468283517075/A-Note-on-the-Indonesian-sub-national-government-surplus-2001-2006 https://hdl.handle.net/10986/28246
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