The Impact of Local Government Capacity on Public Service Delivery: Lessons Learned from Decentralized Indonesia

The issue of poor local government capacity has been considered one the problems impeding implementation decentralization, especially in developing countries. This study addresses this case Indonesia, a country that implemented massive decentralization (administrative, fiscal, and political) over last two decades. aims to provide empirical evidence for impact on public service delivery regime. Local is measured based policy framework at organizational level includes three types capacities: analytical, operational, political. regression panel data model, estimated with Hausman–Taylor method, reveals terms interactions capacities positive delivery. finding indicates are complementary effectively improve government’s achievement delivering services. While operational (including fiscal capacity) long reckoned designing result gives other critical should be well considered, political analytical capacities. It underpins efforts internalize implementing programs.