From Public Money to Public Action: Policy-Translation Capacity in Southeast Sulawesi, Indonesia

Public money does not become developmentally consequential through allocation alone; its effects depend on how fiscal choices are translated into coordinated and implementable public action. This article develops policy-translation capacity to explain that conversion by focusing on functional connectivity among institutional capabilities. It asks how policy-translation capacity conditions the conversion of fiscal choices into public action and helps explain differentiated trajectories of inclusive development in Southeast Sulawesi, Indonesia. The study uses an explanatory mixed-methods design combining longitudinal fiscal and development evidence for 2015–2024 with planning and policy documents, fiscal and governance reports, audit findings, institutional assessments, field observations, and 22 semi-structured interviews with senior officials involved in planning, fiscal management, programme implementation, and internal oversight. The findings show persistent dependence on intergovernmental transfers alongside divergent developmental trajectories: poverty improved but diverged from the national trend, inequality declined non-linearly, and human development substantially converged toward the national benchmark. Institutional analysis identifies uneven connectivity across four interfaces linking fiscal authorization to operational readiness, distributed responsibility to coordinated action, implementation experience to adaptation, and identified weakness to substantive correction. Formal institutional functions were generally present, but their outputs did not consistently become usable inputs for subsequent action. The article contributes to institutional-capacity research by conceptualizing policy-translation capacity as a process-oriented mechanism rather than an additional capacity category. It demonstrates that the developmental effectiveness of public money depends not only on resources, fiscal discretion, or the strength of individual capabilities, but also on the institutional interfaces through which budgeting, implementation, coordination, evidence use, and correction remain connected. Strengthening these interfaces may improve the capacity of decentralized governments to convert fiscal opportunities into adaptive, coordinated, and developmentally consequential public action across successive policy implementation cycles.

public money; policy-translation capacity; functional connectivity; public financial management; fiscal decentralization; institutional capacity; public action; Indonesia

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