What Influences Subnational Competitiveness in a Decentralized Indonesia?

One of the objectives of Indonesia’s 2001 decentralization reform was to enable the country’s subnational regions (provinces, cities and regencies) to realize their unique potential and, thus, implicitly, maximize their competitive advantage. While we have seen some improvements in socio-economic de...

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Bibliographic Details
Published in:ASEAN economic bulletin 2021-12, Vol.38 (3), p.336-357
Main Authors: Amri, Puspa Delima, Amri, Mulya
Format: Article
Language:English
Subjects:
Accountability
Citizen participation
Comparative advantage
Competition
Competitive advantage
Competitiveness
Corruption in government
Decentralization
Democracy
Economic development
Expenditures
Government spending
Indonesia
Politics
Provinces
Regions
Socioeconomic development
Socioeconomic factors
Taxes
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Summary:One of the objectives of Indonesia’s 2001 decentralization reform was to enable the country’s subnational regions (provinces, cities and regencies) to realize their unique potential and, thus, implicitly, maximize their competitive advantage. While we have seen some improvements in socio-economic development and democratic accountability, stark variations in economic outcomes across regions remain. Why are some more successful than others in achieving competitiveness? Focusing primarily on district-level data from 1998 to 2016, this paper systematically examines the factors that may influence variations in subnational competitiveness in Indonesia. We found significant correlations between competitiveness and fiscal decentralization measures and, separately, between competitiveness at the province level and elements of democracy.
ISSN:2339-5095
2339-5206
DOI:10.1355/ae38-3d