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The Role of Natural Resources on Moderating the Relationship between Fiscal Decentralization and Corruption: Evidence from Indonesia

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  • Akhmad Samsul Ulum

    (Ph.D Student at the Faculty of Economics and Business, Diponegoro University, Semarang, Indonesia. Lecturer at Faculty of Economics, Pekalongan University, Indonesia,)

  • Abdul Rohman

    (Departement of Accounting, Faculty of Economics and Business, Diponegoro University, Semarang, Indonesia.)

  • Puji Harto

    (Departement of Accounting, Faculty of Economics and Business, Diponegoro University, Semarang, Indonesia.)

  • Dwi Ratmono

    (Departement of Accounting, Faculty of Economics and Business, Diponegoro University, Semarang, Indonesia.)

  • Imam Ghozali

    (Departement of Accounting, Faculty of Economics and Business, Diponegoro University, Semarang, Indonesia.)

Abstract

This study aims to provide empirical evidences about the influence of fiscal decentralization on the level of corruption in regional governments of district and city in Indonesia and the role of natural resources in that influence. Panel data is used in this study with the observation period from 2008 to 2014 and 514 population from regency and city governments. As many as 433 observations from the final sample was taken based on the purposive sampling method. Meanwhile, the hypothesis testing using PLS-SEM with WarpPLS. The results of the study found out that fiscal decentralization will increase the incidence of corruption in the district and city of regional governments. The second finding is that natural resources will increase the incidence of corruption when the regional autonomy system and fiscal decentralization are applied to local governments.

Suggested Citation

  • Akhmad Samsul Ulum & Abdul Rohman & Puji Harto & Dwi Ratmono & Imam Ghozali, 2019. "The Role of Natural Resources on Moderating the Relationship between Fiscal Decentralization and Corruption: Evidence from Indonesia," International Journal of Energy Economics and Policy, Econjournals, vol. 9(1), pages 67-75.
    • Handle: RePEc:eco:journ2:2019-01-9
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    References listed on IDEAS

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    Cited by:

    1. Vellayati Hajad, 2021. "The Dilemma of Natural Resources: Economic Opportunities and Challenges Post-Conflict," International Journal of Energy Economics and Policy, Econjournals, vol. 11(1), pages 426-432.

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    More about this item

    Keywords

    Fiscal decentralization; corruption; natural resources;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • Q34 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Natural Resources and Domestic and International Conflicts

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