Under Indonesia’s Village Law, significant resources and responsibilities are devolved to village governments. These small bureaucracies manage relatively large budgets by international standards, amounting to 3% of government spending nationally. Between 2015 and 2018, the central government transferred approximately US$14 billion to more than 75,000 villages across Indonesia, and transfers to villages increased nearly five-fold between 2013 and 2018 (World Bank, 2020). In our data, village heads report annual village budgets averaging 1.26 billion IDR (approximately USD 83,000). Budgets require agreement between the village head and the village consultative body ( _Badan Perwakilan Desa_ or BPD), and are subsequently submitted for approval to the district government.

The vast majority of village heads in our data are male (95%). On average, they are 48 years old and have 13.2 years of education. Most (96%) were elected as required by law, while the rest were appointed. The average village head reported having served for 5.2 years.

**Composition of Village Governments.** Village heads appoint members of the village government ( _aparatur desa_ ), which includes four key positions: a village secretary and three heads of affairs responsible for general matters, finances, and planning (see Appendix Figure B.1 for an illustration). These officials are selected by the village head among village residents after consultation with the subdistrict head. By law, they can only leave their positions under specific circumstances, such as death, resignation, retirement, or criminal conviction. In our sample, village officials, on average, are 38.5 years old, have 13.6 years of education, and have served in the village bureaucracy for 5.4 years. Most (76%) report having permanent tenure. Family ties play a notable role in appointments: 22% have a parent who served in the village government, and 5% have a parent who was a village head.<sup>1</sup>

**Political Economy of Village Governance.** Local democracy is vibrant across Indonesia. Aspinall and Rohman (2017) and Berenschot et al. (2021) provide extensive qualitative evidence and case studies highlighting the intensity of electoral competition in village elections. These elections are highly contested, and incumbents do not enjoy a systematic advantage. Even before the Village Law era, the democratic transition in 1998 created new pathways for individuals outside traditional elite networks—in particular, aristocratic elites associated with the prior Suharto regime (Berenschot et al., 2021)—to attain leadership positions: _“The breakdown of centralised mechanisms of control has opened space for sometimes unruly political contestation in the villages . . . established elites have lost their former monopoly on village power”_ (Aspinall and Rohman, 2017, p.32). Other evidence highlights that _“village politics [are] sometimes marked by intense political competition and close margins of victory in village head elections”_ (World Bank, 2023, p.v).

However, despite intense electoral competition at the local level, significant challenges remain in establishing village governments that operate with full accountability and transparency. The ongoing process of elite renewal initiated in 1998 remains incomplete due to the resilience of strong patronage networks associated with well-established family dynasties. Despite substantial variation across villages, a key challenge stems from the continued practice of village heads appointing friends and relatives in the village government, reflecting broader patterns of elite capture in formal deliberative institutions.

> 1Beyond the village secretariat, the village governance structure also includes the chairperson of village representative bodies (BPD) and BPD members, as well as local leaders of hamlets or neighborhoods ( _dusun_ ). Our analysis focuses on the main officials in the village government: village secretaries and heads of affairs for general, financial, and planning matters.

5