Does fiscal decentralization in a politically decentralized less developed country help strengthen democratic institutions at the grass root level? And is the impact of such decentralization on local politics important in determining local development? Our study on Indonesia suggests that fiscal...

Does fiscal decentralization in a politically decentralized less developed country help strengthen democratic institutions at the grass root level? And is the impact of such decentralization on local politics important in determining local development? Our study on Indonesia suggests that fiscal...

This paper examines how the introduction of the Fiscal Decentralization (FD) at the turn of the Century that offered greater freedom in local governance affected grassroots politics and local development in Indonesia. We find that socio-culturally homogenous communities are more likely to...