ANALYSIS OF THE ROLE OF MANAGERIAL ECONOMICS IN STRATEGIC DECISION-MAKING IN LOCAL GOVERNMENT
Keywords:
Managerial Economics, Strategic Decision, Local Government, Public Policy, Good GovernanceAbstract
Strategic decision-making is one of the primary functions of local governments in achieving effective, efficient, transparent, and accountable governance. The complexity of regional development issues, limited resources, and increasing public demands for quality public services call for a more rational and data-driven approach to the decision-making process. This study aims to analyze the role of managerial economics in supporting strategic decision-making in local governments. The study employs a library research method with a qualitative descriptive approach through the analysis of various books, scientific articles, regulations, and research findings related to managerial economics, public management, and strategic decision-making. The findings indicate that managerial economics serves as an analytical tool for optimizing resource allocation, conducting cost-benefit analyses, assessing community needs, evaluating policy alternatives, managing risks, and enhancing the effectiveness of regional development planning. The application of managerial economics principles also supports the formulation of public policies that are more adaptive to changes in the strategic environment and strengthens the accountability of local government performance. Thus, managerial economics is an important approach for improving the quality of local government strategic decisions toward good governance.
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