Abstract

This research investigates determine the level of technical efficiency of Infastructure spending in districts/ municipalities and its effect on economic growth of Jambi Province at periode 2013 to 2017. Using 2 (two) research methods, Data Envelopment Analysis (DEA) with VRS optimization and output oriented to answer the first research objective, which is trying to measure technical efficiency of local government (the most efficient local government is considered to have 100% efficiency) as a reference from all DMUs being compared. The output variables are the percentage of steady roads, electrification ratios and community access to clean water (chosen as the Government’s Main Performance Indicator in infrastructure) with infrastructure expenditure (local government infrastructure spending plus provincial infrastructure spending in each regencies/ municipalities plus infrastructure spending from state budget in each regencies/municipalities). Regression using OLS to answer the second research objective is to determine the effect of the technical efficiency of infrastructure spending on unemployment in regencies/municipality in Jambi Province. The result show that the technical efficiency of infrastructure spending has a significant effect on unemployment of regencies/municipality in Jambi Province, its reduce unemployment.

Technical Efficiency, DEA, OLS, Public Finance, unemployment