Title:
Measuring and Mapping Fiscal Imbalance Regionally in Bangka Belitung Island Province

Authors:
Devi Valeriani, Edih Mulyadi, Zamrud Utami, Willa Fatika Sari, Berandi Suaryansyah, Indonesia

Abstract:

Fiscal decentralisation aims to improve the efficiency of resource allocation, income distribution, and economic stabilisation. However, its implementation in the Bangka Belitung Islands Province has encountered challenges in supporting regional economic development, particularly in the form of vertical and horizontal fiscal imbalances. This study employs quantitative data comprising the Special Allocation Fund, General Allocation Fund, regional loans, total regional government expenditure, loan repayments, regional revenue, tax and non-tax revenue-sharing funds, Locally Generated Revenue per capita, Gross Regional Domestic Product per capita, and per capita expenditure. The analysis applies the correlation coefficient approach to measure vertical fiscal imbalance and the Theil Index to assess horizontal fiscal imbalance. The findings indicate that 57.15% of the regencies and municipality experienced a moderate level of vertical fiscal imbalance, while 42.85% exhibited a low level of imbalance. All regions experienced substantial expenditure shortfalls, resulting in a high dependence on fiscal transfers from the central government. In terms of horizontal fiscal imbalance, most regions displayed relatively low levels of disparity, with the exception of Pangkalpinang Municipality, which recorded a comparatively high level of fiscal inequality. These findings highlight the importance of strengthening Locally Generated Revenue, improving public expenditure efficiency, promoting economic diversification, and enhancing interregional collaboration to reinforce local fiscal independence.

DOI: https://doi.org/10.51505/IJEBMR.2026.10721