Influence Analysis of Monetary and Fiscal Policy to Price Stability and Regional Economic Growth in East Java : Period 1995 to 2004

This research analyzes the regional price stability in Indonesia, post the implementation of the UU No.23, 1999 and UU No.22, 1999. The first relates to the task of Bank Indonesia to stabilize the Rupiah, while the latter is about the fiscal decentralization from the center to the regional government. The panel estimation technique is utilized on the case of East Java data, covering 6 classified periods, namely before crisis, period of crisis, prior decentralization and the period after decentralization. The result shows several findings, first, the fiscal decentralization and economic crisis have influence the price stability and economic growth significantly. Second, the join monetary and fiscal policies, has a significant impact on the regional growth and the price stability. Furthermore, this study shows a higher impact of the monetary policy than the fiscal policy