Does Fiscal Decentralization Good For Reducing Communal Conflict?

Abstract

Whether fiscal decentralization is good for reducing communal conflict is still debatable. This study examines the linkage between fiscal decentralization and communal conflict in Indonesia, administrative decentralization, and political decentralization is examined as well. Data come from the Village National Census (Podes) 2008-2014 (N=234,717). Results of twolevel logit regression show that fiscal decentralization not significantly associated with reducing communal conflict. The findings suggest that decentralization work for reducing communal conflict through better capacity of local bureaucrats rather than through financing capacity in delivering public services and the enhanced opportunities for channeling citizen participation in direct political participation.