Preference heterogeneity of local government for implementing ICT infrastructure and services through public-private partnership mechanism

Abstract

The government addresses the demand for information and communication technology (ICT) infrastructure based on strategic economic planning. However, financial resources, as well as government inefficiencies handling the public infrastructure are the most prominent constraints hindering the development of infrastructure. In such a case, incorporating the private sector would strengthen the government strategy to implement the public ICT infrastructure. This study analyses the government perception to implement the public ICT infrastructure incorporating the private sector and finds strong heterogeneity to implement the public ICT infrastructure through public-private partnership (PPP) mechanisms. The main results are that the government agencies (decision makers) in Nepal positively prefer foreign companies and tend to share financial risks with the private sector in implementing ICT projects through PPP. However, there is relatively high heterogeneity in preferences of the government agencies for these attributes. The results of this study imply that public and private sectors might exhibit opportunistic behavior from the development to the operation of the project, ultimately risking the successful outcome of the project.