Analisis Pengaruh Kemandirian Keuangan Daerah terhadap Pertumbuhan Ekonomi Kabupaten dan Kota di Provinsi Jambi

ABSTRACT The main objectives of this research are to analyze self-relience of local financial independence and its impact on economic growth on municipalities and cities in the Province of Jambi. The research object is composed of 10 districts and cities in the Province of Jambi. The data of PAD, GDP, TPD, Balance Funds, and Economic Growth are analised by using two approaches. Firstly, data are used to analyse of financial independence ratio (to calculate the ratio of local financial independence) and secondly, utilised simple linear regression analysis with panel data (to analize the influence of local financial independence to economic growth municipalities and cities in the Province of Jambi). Based on data analysis, this study was obtained two conclussio. First, the financial independence of citydan district in Jambi Province during the period of research is still in the very low category with an average percentage below the 10% figure. Second, the results from simple linear regression analysis with panel data approach using fixed effect method found that financial independencehas positive effect on the economic growth of regions and satistically significant (with α:10%). This emprical finding shows that the higher the ratio of local financial independenc, the higher the increasing of economic growth on municipalities and cities in the Province of Jambi. These also explain that economic growth must be supported by an increase in the area of financial independence. Initiative and the willingness and hard work of the local government should be there to increase revenue. In addition, it is also necessary to evaluate the use of matching funds to increase self-relience.Keywords: Independence, Local Finance, Economic Growth, Liniear Regression Panel Dat