Urban politics on housing policy transformation in Indonesia: an institutional perspective

This study develops a model of urban politics on public policy transformation using an institutionalist perspective, examining Indonesia’s inclusionary housing policy. It addresses the question: to what extent does the interplay between public and private sector actors influence affordable housing policy in Indonesia? Urban politics is examined through the evolving interplay among key actors involved in housing provision. We argue that these dynamics shape the design and implementation of the Lingkungan Hunian Berimbang (LHB) regulation as Indonesia’s key inclusionary housing policy which has endured for over three decades. Using interviews and content analysis of regulations and reports, we observe policy shifts shaped by changing institutional logics: from state-driven mandates to market-oriented governance. Our findings demonstrate how neoliberalism has reconfigured housing policy, with increasing reliance on private sector participation. This study contributes to understanding how institutional change and political negotiations transform housing policy frameworks, highlighting the strategic role of urban politics in shaping affordable housing outcomes in the Global South.