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This is a Quantitative Study study.

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October 16, 2025

The Influence of Local Government Financial Performance on Public Welfare in Banten, Indonesia

Key Points

Local government financial performance significantly influences public welfare indicators like human development index.
Key metrics such as unemployment and poverty rates show a notable correlation with financial performance from 2010 to 2023.
The spending alignment ratio serves as a crucial moderator, enhancing the relationship between financial performance and public welfare.
The expenditure harmony ratio does not significantly affect the link between financial performance and public welfare outcomes.

Abstract

The purpose of this research is to investigate how public wellbeing in Banten Province is impacted by local governments' financial performance between 2010 and 2023. Public welfare as shown by the Human Development Index (HDI), unemployment rate, and poverty rate is significantly impacted by the financial performance as determined by the regional independence ratio, fiscal decentralization ratio, and regional dependency ratio. Public wellbeing is also significantly impacted by the spending alignment ratio as a moderator variable. Public welfare is not significantly impacted by the relationship between the expenditure harmony ratio and local government financial performance.

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