The Influence of the Factors of Democracy, Politics, Corruption, and Government Governance on Local Own-Source Revenue of Provinces in Indonesia

This study aims to analyse the influence of democracy, politics, corruption, and government governance on local own-source revenue in all provinces in Indonesia. This study uses a quantitative approach method. The data analysed is a data series from 2010 to 2017 for 30 provinces in Indonesia. This study is analysed using the Random Effect Model (REM) and from the test results that are obtained, it is found that the factors of democracy and government governance have a significant and positive effect on local own-source revenue. The political factor has a positive but not significant influence on local own-source revenue, while the corruption factor has a negative and significant influence on local own-source revenue. In general, the results show that there is a close relationship between democracy, politics, corruption, and government governance. This can happen because the means of democracy can be done together with public participation in political parties through public services that run well, with reorientation toward the government through one-stop service and e-systems, therefore they are able to perform well, which in turn can reduce corruption. The people’s trust will lead to a conducive and growing business climate, and there will be development and increase in investments from inside and outside the province. Thus, the government will be able to collect taxes, levies, and other sources of revenue that will belong to local governments and that can be used for the development of the region that is concerned.