DOI: 10.36347/sjebm.2017.v04i06.002

Pages: 368-376

Local Own-Source Revenue (LOSR) of a regional is one source of revenue that aims to give authority to local governments to fund the implementation of autonomy in accordance with the potential of the region. The purpose of this study are: (1) To determine the elasticity of the LOSR in Central Maluku Regency; (2) To determine the effectiveness of the OSR in Central Maluku Regency; and (3) To determine the role of the LOSR to strengthening Fiscal Capacity in Central Maluku Regency. The method of research used in this research is descriptive quantitative analysis, using analysis tools, such as elasticity, fiscal effort (effectiveness), and the degree of fiscal decentralization (DFD). The results showed that: (1) The elasticity does not occur during the 2009-2012 period. It’s because the value < 1. Elasticity is only achieved in the period of 2013. (2) The effectiveness of LOSR is quite effective. (3) The role of OSR if measured by the DFD, shows the fiscal capacity is very low during the 2009-2013 periods. So, the pattern of relationships should be created between the local government of Central Maluku and the central government is instructive relationship patterns.