Abstract:

This study uses panel data for 23 districts in Aceh from 2008 to 2018 with a total of 253 samples and panel ARDL is utilized to examine the dynamic poverty response to government expenditures in Aceh Province. The results show that government budget on capital spending has no significant effect on poverty reduction in the long-run, but significant in the short-run.  Meanwhile, the government budget on personnel expenditure has a significant effect on poverty reduction in the long-run.  It is recommended that budget allocation on capital expenditure should be added to reduce poverty in Aceh Province because this budget is relatively small compared to personnel expenditure.