M. Harry Mulya Zein, Sisca Septiani
Sound financial management will affect regional progress. Local governments must explore the potential to increase regional financial resources so that financial performance increases and encourages economic growth, improves the human development index, and reduces poverty. This study examines the effect of financial performance on capital expenditure, economic growth, human development index, and poverty. The study used a quantitative approach with path analysis, using secondary data on city/district government finances in Banten Province in 2018-2022. The study's financial performance results significantly affect economic growth as measured by the independence, effectiveness, fiscal decentralization, and dependency ratios. Financial performance, as measured by the independence ratio, effectiveness ratio, fiscal decentralization ratio, and dependency ratio, has an influence and is not significant on poverty. Financial performance, as measured by the independence ratio, effectiveness ratio, fiscal decentralization ratio, and dependency ratio, has an impact and is not significant on the human development index. Capital expenditure significantly influences financial performance measured by the independence ratio, effectiveness ratio, fiscal decentralization ratio, and dependency ratio on economic growth. It has a significant impact on mediating the human development index. Capital expenditure does not significantly judge financial performance as measured by the independence ratio, effectiveness ratio, fiscal decentralization ratio, and dependency ratio to poverty. Economic growth has no significant effect on mediating finance as measured by the independence, effectiveness, fiscal decentralization, and poverty dependency ratios. The human development index does not significantly mediate finance measured by autonomy, energy, fiscal decentralization, and dependency on poverty ratios. © 2024, SRAC - Romanian Society for Quality. All rights reserved.
Governance Institute of Home Affairs (IPDN), Jakarta, Indonesia; State University of Semarang, Indonesia
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