The Effect of Economic Growth and Local Own Income on the Level of Regional Financial Independence (A Case Study in a Regency / City in North Sumatra)

Abstract

This study aims to examine the economic growth of district and municipal governments in North Sumatra Province. Based on this type of research, this research is qualitative research. The population in this study were districts and cities in the province of North Sumatra. The sample in this study were all districts and cities in North Sumatra. Secondary data were obtained from the Central Statistics Agency of North Sumatra Province. The data analysis technique used is the ratio analysis technique to measure economic growth.

The results of this study indicate that the Economic Growth variable partially has no and insignificant effect on Financial Independence which is registered in the North Sumatra Central Statistics Agency for the period 2014-2016 with a significant value of 0.390, Regional Original Income partially has a positive and significant effect on Financial Independence listed in North Sumatra Central Statistics Agency for the period 2014-2016 with a significant value of 0.000. The coefficient of determination generated in this study is valued at 0.624. Which means that 62.4% of variable X affects variable Y, while the remaining value is 37.6 which is influenced by other variables.