Person:
Kaiser, Kai
Author Name Variants
Fields of Specialization
Public finance
Degrees
Externally Hosted Work
Contact Information
Last updated
January 31, 2023
Publication Search Results
1 - 3 of 3
-
Publication
Electoral Accountability and Local Government Spending in Indonesia
(World Bank, Washington, DC, 2014-02)This paper takes advantage of the exogenous phasing of direct elections in districts and applies the double-difference estimator to measure impacts on (i) human development outcomes and (ii) the pattern of public spending and revenue generation at the district level. The analysis reveals that four years after the switch to direct elections, there have been no significant effects on human development outcomes. However, the estimates of the impact of Pilkada on health expenditures at the district level suggest that directly elected district officials may have become more responsive to local needs at least in the area of health. The composition of district expenditures changes considerably during the year and sometimes the year before the elections, shifting toward expenditure categories that allow incumbent district heads running as candidates in the direct elections to "buy" voter support. Electoral reforms did not lead to higher revenue generation from own sources and had no effect on the budget surplus of districts with directly elected heads. -
Publication
Evaluating Fiscal Equalization in Indonesia
(World Bank, Washington, DC, 2006-05)This paper presents a methodology to evaluate fiscal decentralization focusing on the potential mis-targeting of intergovernmental fiscal equalization transfers. The approach builds on an explicit comparison and the summary measurement of different (horizontal) allocation distributions across states or localities. Whereas formula-based fiscal transfers have the merit of being transparent and promoting revenue predictability in fiscal decentralization, in practice, two challenges emerge: (1) What are the appropriate formula designs given the sub-national data constraints evident in most decentralizing developing countries? and (2) How costly in terms of mis-targeting to the presumed expenditure needs and fiscal capacity are deviations from these types of benchmark formulas (for example, due to historical factors or the need to meet establishment costs such as civil service wages)? The authors illustrate this approach by assessing Indonesia's evolving intergovernmental fiscal system instituted in the 2001 Big Bang decentralization. The discussion comes against Indonesia's recent policy decision to fully fund sub-national civil servant wages as part of the base general allocation grant (DAU) transfers, raising questions about both incentive effects for local governments and potential mis-targeting. The authors identify potential efficiency losses from the DAU's horizontal misallocation from half a dozen alternative scenarios found in the policy dialogue, ranging from 9 to 30 percent-on the order of US$ 3.9 billion-of the overall annual size of this large intergovernmental transfer. The scale of these tradeoffs highlights the importance of intergovernmental transfers in more general debates in public finance for decentralized countries. -
Publication
Agglomeration, Transport, and Regional Development in Indonesia
(World Bank, Washington, DC, 2005-01)How effective are public interventions in addressing significant regional disparities in formal manufacturing concentration in a developing economy? The authors examine the aggregate and sectoral geographic concentration of manufacturing industries for Indonesia, and estimate the impact of factors influencing location choice at the firm level. They distinguish between natural advantage, including infrastructure endowments, wage rates, and natural resource endowments, and production externalities, arising from the co-location of firms in the same or complementary industries. The methodology pays special attention to empirically distinguishing the impact of measured production externalities from unobserved local characteristics. Depending on the sector, the authors find that a mix of both forms of regional advantage explains the geographic distribution of firms. Based on the estimated location choice model, they illustrate the potential impacts of policy interventions on manufacturing distribution by simulating the effectiveness of transport improvements on relocation of firms. Their findings suggest that improvements in transport infrastructure may only have limited effects in attracting industry to secondary industrial centers outside of Java, especially in sectors already established in leading regions. The findings underscore the challenges for addressing the industrial fortunes of lagging regions, either through local decentralized policy interventions or national policies focused on infrastructure development.