IMPACT OF VILLAGE FUNDS ON POVERTY AND REGIONAL ECONOMIC GROWTH

Abstract

Law No. 6 of 2014 concerning Villages is a form of state recognition of villages, which aims to clarify the functions and authority of villages, and strengthen the position of villages and rural communities as the subject of development. To support the village's tasks and duties, in accordance with existing regulations, Law Number 6 of 2014 gives a mandate to the Government to allocate Village funds, which since 2015 have been allocated to the State Budget. The research objective is to determine the impact of village funds on poverty and regional economic growth. Using the fixed effect model with pooled data series 2015-2019. Village funds have a positive impact on regional economic growth and are statistically significant, and can reduce poverty but are not statistically significant. To provide a better impact on economic improvement in the village area, village assistance funds are directed towards financial activities and community empowerment