ANALYSIS THE EFFECT OF GOVERNMENT DEVELOPMENT EXPENDITURE AND CREDIT EXPANSION ON GROSS REGIONAL DOMESTIC PRODUCT OF ACEH PROVINCE By. Dian Keumala Supervisors : Prof. Dr. Abubakar Hamzah Prof. Dr. Mohd Nur Syechalad, MS ABSTRACT The objective of this study is to examine the effect of government investment and credit expansion on GRDP. This study was using secondary data from the Aceh province, during 1984 to 2011. This study used multiple linear regression model, adapting from Gujarati (2009). After using econometric tools such as SPSS, It can be concluded that government development expenditure (APBN, APBD) has a negative significant effect on GRDP in Aceh province. The credit expansion has a positive significant effect on GRDP of Aceh province. The result of this study confirm that view of government development expenditure (APBN, APBD) in Aceh province has not been productive, but counter the widely held view the government expenditure is increasing GRDP. The credit expansion can boost the economy of Aceh on that model, probably because with the amount of money spent on the community it will increase government revenue, link taxes on economic activities. The government of Aceh province is expected to make good planning in the use of the budget so that government expenditure of Aceh province can be more efficient and effective to avoid unproductive budget. Keywords : Government Expenditure, Credit Expansion, GRDP of Aceh Province