THE EFFECT OF DISCRETIONARY SPENDING ON INCUMBENT VICTORIES IN ELECTIONS

Abstract

Purpose of the study: This study aims to investigate the opportunistic behavior of local government heads in Indonesia using discretionary spending (grant spending, social assistance, and financial assistance) to win an election. Methodology: The study uses logistic regression on 133 samples of district/municipal governments in Indonesia prior to the election period. Main findings: The study finds no evidence that the average proportion and growth of discretionary expenditure affects the electability of incumbents in Indonesia’s local government head elections. That is, the use of discretionary spending is not sufficiently effective to attract sympathy from voters. Applications of the study: The results of the study provide inputs, especially for incumbents, to help focus more on performance, as it is proven that it leads to a higher probability of being re-elected, rather than the use of discretionary spending as an election-winning strategy. Government and NGOs should inform voters to be more cautious about the opportunistic behavior of their leaders. Novelty/originality of the study: Although some previous studies have examined the use of discretionary spending by incumbents, there has been little research, which provides evidence that such spending for political purposes can in fact help to win elections.