IDEAS home Printed from
   My bibliography  Save this paper

Ecological fiscal transfers at the provincial level in Indonesia


  • Mumbunan, Sonny
  • Ring, Irene
  • Lenk, Thomas


A region of ecological importance which generates uncompensated cross-territorial positive spillovers has a comparatively higher fiscal need due to the direct and indirect costs it incurs for nature conservation. In order adequately to acknowledge fiscal needs relating to nature conservation, we propose an indicator based on protected area as a means of distributing general-purpose transfers and model the consequences of this for Indonesia's current system of fiscal transfer from the national to the provincial level. The results suggest that about a third of the country's provinces would benefit from the new transfer regime and that the equalizing effect of the transfers increases as the proportion of protected area increases.

Suggested Citation

  • Mumbunan, Sonny & Ring, Irene & Lenk, Thomas, 2012. "Ecological fiscal transfers at the provincial level in Indonesia," UFZ Discussion Papers 06/2012, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).
  • Handle: RePEc:zbw:ufzdps:062012

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Daniel C. Morgan, Jr., 1974. "Fiscal Neglect of Urban Areas by a State Government," Land Economics, University of Wisconsin Press, vol. 50(2), pages 137-144.
    2. Kaul, Inge & Conceicao, Pedro & Le Goulven, Katell & Mendoza, Ronald U. (ed.), 2003. "Providing Global Public Goods: Managing Globalization," OUP Catalogue, Oxford University Press, number 9780195157413, June.
    3. Engel, Stefanie & Palmer, Charles, 2008. "Payments for environmental services as an alternative to logging under weak property rights: The case of Indonesia," Ecological Economics, Elsevier, vol. 65(4), pages 799-809, May.
    4. Kumar, Surender & Managi, Shunsuke, 2009. "Compensation for environmental services and intergovernmental fiscal transfers: The case of India," Ecological Economics, Elsevier, vol. 68(12), pages 3052-3059, October.
    5. Hajkowicz, Stefan, 2007. "Allocating scarce financial resources across regions for environmental management in Queensland, Australia," Ecological Economics, Elsevier, vol. 61(2-3), pages 208-216, March.
    6. Silvana Dalmazzone, 2006. "Decentralization and the Environment," Chapters,in: Handbook of Fiscal Federalism, chapter 18 Edward Elgar Publishing.
    7. Baumol,William J. & Oates,Wallace E., 1988. "The Theory of Environmental Policy," Cambridge Books, Cambridge University Press, number 9780521322249, March.
    8. Arild Vatn & Daniel Bromley, 1997. "Externalities — A market model failure," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 9(2), pages 135-151, March.
    9. Hal Hill & Budy Resosudarmo & Yogi Vidyattama, 2008. "Indonesia'S Changing Economic Geography," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 44(3), pages 407-435.
    10. List, John A & Bulte, Erwin H & Shogren, Jason F, 2002. ""Beggar Thy Neighbor": Testing for Free Riding in State-Level Endangered Species Expenditures," Public Choice, Springer, vol. 111(3-4), pages 303-315, June.
    11. Ring, Irene, 2002. "Ecological public functions and fiscal equalisation at the local level in Germany," Ecological Economics, Elsevier, vol. 42(3), pages 415-427, September.
    12. Blane D. Lewis, 2005. "Indonesian Local Government Spending, Taxing and Saving: An Explanation of Pre- and Post-decentralization Fiscal Outcomes ," Asian Economic Journal, East Asian Economic Association, vol. 19(3), pages 291-317, September.
    Full references (including those not matched with items on IDEAS)

    More about this item


    ecological fiscal transfers; intergovernmental fiscal transfer; biodiversity conservation; protected areas; fiscal equalization; Indonesia;

    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:ufzdps:062012. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.