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This study aims to analyze the fiscal and poverty performance, to analyze the fiscal policy impact on poverty performance, and to determine strategic policy on poverty in North Sumatra Province. Model of fiscal policy in Province of North Sumatra was built with the dynamic simultaneous equations system and used 2SLS with SYSLIN and SIMNLIN procedures. We used pooled data in 1990-2007 period. The results are (1) factors of fiscal performance in North Sumatra which were local tax and tax sharing were influenced by local GDP positively, otherwise general alocation funds and local retribution were not influenced by local GDP, and (2) during fiscal policy, poverty performance decreased, which was interpreted with number of poor people in rural areas and number of poor in urban-poverty condition in urban area trend to decreased and fluctuated, (3) in simulation section, decreasing of literacy and health expenditure gave better impact on poverty and also increasing local GDP in North Sumatra than other simulation. Fiscal policy, especially in health and education sector, will stimulate quality social life in the future. |
