Trust in Government and Public-Private Partnership on Infrastructure Financing: Indonesian Experience

Abstract

There has been a huge shift in infrastructure development since the introduction of publicprivate partnership. However, one of the government's challenges continues to be the absence of private sector engagement in such an arrangement. Therefore, the purpose of this study is to explore non-financial factors that influence investors' decisions to fund PPP projects. This study specifically aims to present a conceptual examination of how private sector investment decisions in PPP in Indonesia are influenced by trust in government and its components, including government service quality, government transparency, and similarity of values. The findings show that trust in government and its attributes play important roles in PPP investment decision. Overall, the findings highlight the significance of non-financial variables in attracting the private sector to participate in government programs, including PPP.