The Effect of PAD, DAU, and SiLPA on Gross Regional Domestic Product in Aceh Province, 2019–2023

Abstract

This study aims to analyze the effect of Regional Original Revenue (PAD), General Allocation Fund (DAU), and Budget Surplus (SiLPA) on Gross Regional Domestic Product (GRDP) in Aceh Province. The research is motivated by the importance of utilizing regional fiscal instruments to drive economic growth at the local level. The study employs a quantitative approach using panel data regression analysis on 23 districts/cities in Aceh Province during the 2019–2023 period. The data used are secondary data obtained from the Central Bureau of Statistics and the Directorate General of Fiscal Balance. The results show that partially, PAD has a negative and insignificant effect on GRDP, DAU has a negative and significant effect on GRDP, while SiLPA has a negative but insignificant effect on GRDP. Simultaneously, the three variables significantly influence GRDP. These findings indicate that the management of regional finances particularly in optimizing expenditures and improving fiscal effectiveness needs to be strengthened to support more equitable and sustainable economic growth in Aceh Province.