The Effect of Gross Regional Domestic Product on Regional Original Revenue in East Java Province

Abstract

This study aims to analyze the influence of Gross Regional Domestic Product (GDP) on Regional Original Revenue in districts in East Java Province. The approach used is quantitative with a simple linear regression method using secondary data from 2021 obtained from the Central Statistics Agency and the Directorate General of Financial Balance. The analysis was carried out with the help of SPSS software to test the significance of the relationship between the two variables. The results showed that Gross Regional Domestic Product had a positive and significant effect on Regional Original Revenue, with a determination coefficient value (R²) of 0.930, which means that 93% of Regional Original Revenue variations were explained by Gross Regional Domestic Product. The calculated t-value of 18.876 and the significance of 0.000 < 0.05 indicate a strong and significant relationship between the two variables. These findings confirm that regional economic growth, which is reflected in the increase in Gross Regional Domestic Product, plays an important role in strengthening regional fiscal independence through increasing Regional Original Revenue in East Java Province.