THE EFFECT OF VILLAGE FUND, PAD, AND EDUCATION ON ECONOMIC GROWTH AND POVERTY LEVEL OF DISTRICT / CITY IN BALI PROVINCE, INDONESIA

Abstract

Poverty is global problem that faced by all country, especially in developing countries such as Indonesia, including Bali Province. Although Bali Province has a good economic growth rate and poverty rate on a national scale, but there is imbalance at districts/cities level. Lack of development capital to create jobs and implement welfare improvement programs, as well as the low quality of education in human resources (HR) are the causes of imbalance economic growth and poverty. Village Fund (DD) is a government policy to accelerate equitable development by creating jobs. Regional Original Income (PAD) is one of the sources used to finance welfare improvement programs. The quality of human resource education is an important factor in increasing economic growth and poverty alleviation. This study aims to analyze the effect of village funds (DD), Regional Original Income (PAD), and education on economic growth and poverty in districts/cities in Bali by using secondary data sourced from the Central Statistics Agency (BPS) and the Directorate General of Finance Region (DJKP) of the Indonesia Ministry of Finance, by time series data of 2015-2019 which analyzed using path analysis techniques. The results of this study indicate that DD significantly has no positive effect on economic growth, PAD and education level have a positive effect but insignificant on economic growth. DD has negative and insignificant effect on the poverty level, PAD and education level has negative effect significantly on the poverty level. Indirectly, the variables DD, PAD, and education level did not significantly effect to the poverty level through economic growth.