Title: The flypaper effect as political budget to achieve economic growth in Eastern Indonesia

Authors: Rudy Badrudin; Muhammad Rimawan

Addresses: Accounting Department, STIE YKPN School of Business, Jalan Seturan, Yogyakarta, 55281, DIY, Indonesia ' Accounting Department, STIE Bima, Jalan Monginsidi, Sarae, Rasanae Barat, Bima, 84118, Nusa Tenggara Barat, Indonesia

Abstract: The allocation of resources into the capital expenditure is a process that is loaded with political interests. This relates to the politics of local government budgets in managing the budget and how regional financial management can be audited by the Supreme Audit Agency through audit opinion statement as a control variable. The purpose of this study is to determine empirically the flypaper effect as political budget to achieve economic growth in Eastern Indonesia. The purposive sampling method was used resulting in a total of 86 samples for 10 years period observations. The analysing method is used E-views. The results of this study indicate that general allocation fund and own source revenue have a positive significant effect on capital expenditure; not occurs flypaper effect; and the audit opinion statement has a positive effect on economic growth in districts in Eastern Indonesia but not significant.

Keywords: general allocation fund; own source revenue; capital expenditure; growth; flypaper effect; political budget; audit opinion.

DOI: 10.1504/IJTGM.2022.10046797

International Journal of Trade and Global Markets, 2022 Vol.15 No.3, pp.313 - 331

Accepted: 13 Feb 2020
Published online: 12 Jul 2022 *

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