Largely undetected under the Soeharto era, Indonesia’s recent democratisation led to recognition of the severity of corruption and a massive anti-corruption agenda, particularly through the establishment of the Corruption Eradication Commission (KPK).

This speaker uses a newly developed database of corruption cases to assess the determinants of corruption in Indonesian districts from 2001 to 2016, and analyses their effects on fiscal and audit outcomes. District location is a strong determinant of corruption, and districts farther from Jakarta and closer to provincial capitals are more corrupt. More corruption led to higher personnel spending, lower capital spending, and worse audit opinions.