Determinants of Regional Financial Independence with Capital Expenditure as a Moderating Variable (An Empirical Study on Regencies/Municipalities in Central Sulawesi Province) Dewi Salmita
Universitas Islam Negeri (UIN) Datokarama Palu
Abstract
ABSTRACT
This study aims to analyze the effect of regional investment, the size of local government, and leverage on regional financial independence, with capital expenditure as a moderating variable in regency and city governments in Central Sulawesi Province for the period 2020-2024. The research employs a quantitative approach using the Structural Equation Modeling-Partial Least Square (SEM-PLS) method through WarpPLS 8.0 software, with a total of 65 observations. The results indicate that regional investment has a positive and significant effect on regional financial independence, while the size of local government and leverage have no significant effect. In the moderation test, capital expenditure does not strengthen the effect of regional investment or leverage on regional financial independence but does strengthen the effect of local government size on regional financial independence.
Keywords: Regional Financial Independence, Regional Investment, Local Government Size, Leverage, Capital Expenditure
