The Effects of Regional Financial Ratios on Human Development Index (An Empirical Study in All Districts / Cities in Central Java Province During 2012–2017)

Abstract

This research examined the effects of fiscal decentralization ratio, regional financial dependency ratio, regional financial independence ratio, and expenditure allocation harmony ratio on Human Development Index (HDI). This study used the data on regional financial ratios in Central Java Province from the years 2012 to 2017. The data used was obtained from the Central Statistics Agency. This research generated several results. First, the fiscal decentralization ratio had a positive and significant effect on HDI. Second, the regional financial dependency ratio had a negative and significant effect on HDI. Third, the regional financial independence ratio had a positive and significant effect on HDI. And fourth, the expenditure allocation harmony ratio had a positive and significant effect on HDI.