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Inefficiency of road concessions in Russia: exception or rule?

Author

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  • Bushansky, S.

    (Central Economics and Mathematics Institute, Russian Academy of Sciences, Moscow, Russia)

Abstract

It explores the contradiction between the optimistic expectations of public-private partnership (PPP) and the estimated socio-economic unprofitability of road concessions in Russia. It is shown that special national guidelines for assessment of PPP efficiency are not a barrier to the approvement of inappropriate, from a public point of view, investment projects. The official approval of such regulations suggests that the Russian design system is skeptical about the possibility of a compromise between public efficiency and PPP projects. In foreign practice, the regulatory traditional requirements for the positive social effect from the development of toll roads are generally preserved, but the expediency of toll (in comparison with free road) is usually "confirmed" by listing its theoretical advantages. The systematic absence of correct calculations, including the examples in methodological documents, indicates the prevailing skepticism of the decision-making system towards rationale of tolling. The main conclusion of the article is that the theoretical notions of PPP as an effective mechanism and at the same time the limited practical choice of its schemes, with an obligatory direct user tolls, are the reason for the mimicry of the investment design system, which is forced to arrange inefficient solutions for road construction.

Suggested Citation

  • Bushansky, S., 2021. "Inefficiency of road concessions in Russia: exception or rule?," Journal of the New Economic Association, New Economic Association, vol. 50(2), pages 97-118.
    • Handle: RePEc:nea:journl:y:2021:i:50:p:97-118
    DOI: 10.31737/2221-2264-2021-50-2-5
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    public-private partnership; toll roads; socio-economic efficiency;
    All these keywords.

    JEL classification:

    • O22 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Project Analysis

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