PENGARUH RASIO KEUANGAN DAERAH TERHADAP PERTUMBUHAN EKONOMI (Studi Kasus 32 Pemerintah Kabupaten Dan Kota Sumatera Utara)

Abstract

Economic growth is the performance of the results of the regional government in obtaining an increase in the output per capita of the region. During the COVID-19 period, local governments experienced a drastic decline in economic growth. Indicators in increasing economic growth other than from a macroeconomic perspective need to be examined from a financial perspective. The purpose of this study was to examine the Regional Financial Independence Ratio, Regional Financial Dependence, Regional Income Growth Analysis, Regional Expenditure Ratio to Gross Regional Domestic Product and Regional Debt Ratio to Gross Regional Domestic Product effect on Gross Regional Domestic Product in Constant Prices at City/Regency Governments in North Sumatra. Research method with causal associative approach with panel data. The research sample is in the form of panel data from 32 City and Regency Governments during 2019 to 2020. The results of this study use the Fixed Effect Model, showing partial results that the Regional Financial Independence Ratio, Regional Financial Dependence, Regional Income Growth Analysis, Regional Expenditure Ratio to Product Gross Regional Domestic Product and the Ratio of Regional Debt to Gross Regional Domestic Product do not have a positive effect on Gross Regional Domestic Product in Constant Prices at City/Regency Governments in North Sumatra. Economic growth during the COVID-19 period experienced a decline because there was no achievement of regional income in 32 city and district governments in North Sumatra. Local government policies really need to be carried out in evaluating regional financial performance such as making payments for taxes and regional levies online, because technological advances are fully used in improving local financial management for City and Regency governments in order to increase economic growth and ultimately create a prosperous society.