The Factors Affecting of the Capital Expenditure Allocation Case: The Local Government of Indonesia

Abstract

T test results showed that the variables of GDP, population density and per capita income has a significant effect on capital expenditure. This means that, in determining the amount of income allocated for capital expenditures, local governments will consider regional growth rates, population density, per capita income. But,  Variable PAD and DAU do not have significant effect on capital expenditure. It can be interpreted that to finance capital expenditures, the local governments will use other sources of funds, not from the PAD and DAU

Keywords: Capital Expenditure, income per capita, population density, the General Allocation Fund (DAU), Gross Domestic Product (GDP), PAD