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Does Intergovernmental Transfers Cause Flypaper effect on Local Spending?

Economic Journal of Emerging Markets

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Title Does Intergovernmental Transfers Cause Flypaper effect on Local Spending?
 
Creator Widarjono, Agus
 
Description The local expenditure in Indonesia either province level or district level rely upon intergovernmental transfers. Theoretically, if the lump sums transfers have more stimulate effect on the local expenditure rather than local private income, they can cause the flypaper effect phenomenon. This study investigates whether the intergovernmental transfer leads to the flypaper effect in the province level during 1995-2002. By using the panel data, the results demon-strate that intergovernmental transfers cause the flypaper effect. Our findings also show that the flypaper effect exists heavily at east region as a backward area than west region as a well-developed area. This finding supports the previous research in districts and municipali-ties.Keyword: Intergovernmental transfers, Local government, Flypaper Effect, panel data
 
Publisher Universitas Islam Indonesia
 
Contributor
 
Date 2009-06-25
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion

 
Format application/pdf
 
Identifier https://journal.uii.ac.id/JEP/article/view/529
10.20885/ejem.v11i2.529
 
Source Economic Journal of Emerging Markets; Volume 11 Issue 2, 2006
2502-180X
2086-3128
 
Language eng
 
Relation https://journal.uii.ac.id/JEP/article/view/529/441