CAPITAL EXPENDITURES AND PERFORMANCE OF LOCAL GOVERNMENT ADMINISTRATION

This study investigates how the realization of capital expenditure budget relates to the performance of local government administration. Findings of this study show that realization of capital expenditure budget is positively associated with the performance of the high-performance subsample. Contrary to the results, the realization of capital expenditure budget is negatively associated with performance of the low-performance subsample. The implication of the findings is that the realization of capital expenditure budget as an indicator of local government's success needs to be used more carefully because the high realization of capital expenditure budget does not necessarily relate the high-performance. This is contingent on the subsample (the high versus the low-performance subsamples) where the local government is included.