Jurnal Ekonomi Pembangunan Volume 17 (2): 125-134, December 2019 P-ISSN: 1829-5843; E-ISSN: 2685-0788 https://ejournal.unsri.ac.id/index.php/jep/index DOI: https://doi.org/10.29259/jep.v17i2.8992 125 The Influence of Local Revenue and Equalization Fund on Economic Growth in East Nusa Tenggara Province Safira Dini Aini 1 , Endah Kurnia 2 *, Sunlip Wibisono 2 1 Department of Development Economics, Universitas Jember, Indonesia * Correspondence author email: endahkurnia.feb@unej.ac.id Article Info: Received: 2019-07-15; Accepted: 2019-10-10; Published: 2019-12-26 Abstract: Fiscal decentralization is a policy made by the government to reduce fiscal dependence on the central government and create financial independence in the region. The independence of regional finance itself can be reflected through the high percentage of PAD revenue to total regional revenues. Where the existence of regional financial independence is expected to help implement regional development that can affect economic growth in the region. The purpose of this study was to determine the influence of the local revenue and equalization fund on economic growth of districts/cities in East Nusa Tenggara Province during 2012-2017. The study uses secondary data with the quantitative approach using the data panel Fixed Effect Model (FEM). The finding of this study indicates that the local revenue has a positive and significant effect on economic growth, while equalization funds an insignificant effect on economic growth in East Nusa Tenggara Province. Keywords: Local revenue, economic growth, equalization funds. JEL Classification: H27, H60 How to Cite: Aini, S. D., Kurnia, E., & Wibisono, S. (2019). The Influence of Local Revenue and Equalization Fund on Economic Growth in East Nusa Tenggara Province. Jurnal Ekonomi Pembangunan, 17(2): 125-134. DOI: https://doi.org/10.29259/jep.v17i2.8992. 1. INTRODUCTION Indonesia enters a new era after implementation of regional autonomy policy with law number 23 of 2014 on local government. The regional autonomy policy is the central government that provides the authority to govern more responsibility for local governments to meet the interests of the local community, both in political, economic, and socio-cultural affairs. For the implementation of this policy, regional autonomy policy is supported by the balance of funds between the central and local governments, as stated in law number 33 of 2004 on the balance of finance between the centre and district to provide new strengths of autonomy local governments. The purpose of the fiscal decentralization is to increase regional autonomy and to reduce the region's fiscal dependence on the central government. According to Enceng et al (2012) Fiscal decentralization is expected to create equitable distribution of financial capabilities between regions in accordance with the magnitude of government authorities submitted to autonomous regions. In the implementation of development, financial aspect is the basis to know the real ability of the area in regulating households. The regional financial self-reliance capability