Impact analysis of shopping area on the improvement of education and index health districts in South Sumatra, Indonesia

Monetary and economic crisis of 1997 has brought great changes in the life of society and the nation of Indonesia. In this period, GDP declined by 20% per year, the exchange rate becomes more than IDR 16,000 per US dollar and inflation almost approaching 100%. Anticipating lowering economic consequences of the crisis, the government implemented the concept of regional autonomy in early 2001 through Act No. 22 year 2009 on local government and Act No. 25 Year 2009 on financial balance between central and local governments, as last amended by Act No. 23 year 2014 and Act No. 33 of 2004. The important implication of regional autonomy concept is fiscal decentralization that gives authority to local governments to regulate and manage their own governmental affairs in the Republic of Indonesia, which aims to improve the welfare of the community through a variety of measures of development success. UNDP set one of the measures of development success with the concept of HDI (Human Development Index). Indonesia is ranked 121 of 187 countries. Compared with the ASEAN countries, Indonesia is still ranked below the member countries of ASEAN. HDI differences between provinces and districts /cities still show the varied numbers. This study analyzes the impact of the district spending to the improvement of education index and health index as a component of IPM, the total expenditure and the GDP impact to the IPM and analyze the impact of the balance funds to the GDP. The analysis showed a significant relationship between exogenous and endogenous variables in four models were formed and the characteristics of each district / city.