Blockchain Papers

Prayote Songklin

No abstract is available for this record.

Deni Ramdani

Indonesia’s fiscal decentralization framework has evolved substantially since the 1998 Reformasi era; however, its capacity to ensure equitable and sustainable development remains debatable. This study analyzes the intricate dynamics of fiscal decentralization within Indonesia’s development financi

Indira Devi Prasain

This study analyzes Kautilya’s Saptanga theory of the state as delineated in the Arthasastra, a seminal work in Eastern political philosophy by applying secondary data. Kautilya's Arthasastra is widely regarded as a cornerstone of Eastern political science due to its comprehensive examination of various aspects of governance, ranging from statecraft and warfare to diplomacy, ethics, and geopolitics. The text portrays a realistic governance portrayal, depicting a complex administrative structure, taxation systems, and an advanced intelligence apparatus. Kautilya advocated a strong state with a combination of seven limbs; every element is equally important for successive states. Kautilya posits that the state's primary objective is to elevate humanity from its natural state, allowing individuals to practice their religion and maintain private property rights. In Kautilya's conception, the king assumes the role of a moral guardian, ensuring his subjects' justice and welfare. Moreover, Arthasastra advocates for a decentralized governance model, wherein the state exercises control over autonomous organizations, and prevents absolute authority.

Februati Trimurni

Deconcentration is simply defined as the delegation of administrative authorities of the central government to the lower level of governments along with the transfer of funds to finance the implementation of the authorities. Deconcentration, in the perspective of public administration, is the transfer of administrative responsibility for specified functions to lower levels within the central government bureaucracy, generally on some spatial basis (Ferguson and Chandrasekharan, 2004). The policy and important decision still lays on the central government and the lower governments or units are merely the implementer of the policy and decision. The practice of the deconcentration in Indonesia has obviously been implementing since the independence of the country with some dynamism and adjustments particularly with the national interest, strategies, economic or even politic. The political reform of Indonesia in the year of 1998 is mainly generated by the demands of some provinces and regions to separate from the country for instance those of demands from Aceh, Papua and Maluku. To respond the demands, central government issued decentralization law notably by the Law No.22/1999 which the revision to the previous Law No.5/1974.

Takashi Shiraishi

Indonesia underwent enormous political and institutional changes in the wake of the 1997–98 economic crisis and the collapse of Soeharto's authoritarian regime. Yet something curious happened under President Yudhoyono: a politics of economic growth has returned in post-crisis decentralized, democratic Indonesia. The politics of economic growth is politics that transforms political issues of redistribution into problems of output and attempts to neutralize social conflict in favor of a consensus on growth. Under Soeharto, this politics provided ideological legitimation to his authoritarian regime. The new politics of economic growth in post-Soeharto Indonesia works differently. Decentralized democracy created a new set of conditions for doing politics: social divisions along ethnic and religious lines are no longer suppressed but are contained locally. A new institutional framework was also created for the economic policy-making. The 1999 Central Bank Law guarantees the independence of the Bank Indonesia (BI) from the government. The Law on State Finance requires the government to keep the annual budget deficit below 3% of the GDP while also expanding the powers of the Ministry of Finance (MOF) at the expense of National Development Planning Agency. No longer insulated in a state of political demobilization as under Soeharto, Indonesian technocracy depends for its performance on who runs these institutions and the complex political processes that inform their decisions and operations.

Ehtisham Ahmad, Ali Mansoor

The Indonesian authorities are exploring options for the establishment of subnational government endowment funds and the Ministry of Finance (MoF) has drafted regulations in that context. However, the motivations and objective for establishing an endowment fund at the subnational level diverge across various stakeholders. Clarity of the objectives and purpose of the endowment fund will be critical for informing features of its architecture, and the endowment fund should be aligned with the national fiscal policy objectives. Establishing such funds at a time of fiscal deficit entails a “borrowing-to-save” approach which is not optimal from a fiscal policy perspective. Currently, there is a misalignment between the design of inflow and outflow rules, the endowment fund’s objectives, and the fiscal/economic context. In addition, the current draft MoF regulations restrict the investment policy to conform with the law on decentralization enacted in 2022. This report emphasizes that regardless of the structure of the endowment fund, it needs to be fully integrated within the budget. The report also provides recommendations on assessing the full cost of the subnational government endowment fund, its design and implementation, and provides suggestions to improve the draft MoF regulations.