IDEAS home Printed from https://ideas.repec.org/p/coe/wpbeer/33.html
   My bibliography  Save this paper

State Aid to Infrastructure: Do Competitively Selected Operators Obtain an Undue Advantage?

Author

Listed:
  • Phedon Nicolaides
  • Nadir Preziosi

    (Scuola di Dottorato in Scienze Umane e Sociali
    Director, Department of European Economic Studies, College of Europe (Bruges))

Abstract

This paper reviews several cases where the Commission presumed that competitively selected operators of large infrastructure projects derived an undue advantage from state aid. The aid was granted to the owners of the infrastructure to supported investment in construction or upgrading. The practice of the Commission is not consistent or clear. The paper also shows that under reasonable assumptions,competitive selection of operators is indeed capable of eliminating any advantage above market rates of return or market rates of cost of capital. The paper demonstrates, both theoretically and with the use of numerical examples, that concession fees take into account any aid that is granted to the owners of infrastructure for its construction or upgrading.

Suggested Citation

  • Phedon Nicolaides & Nadir Preziosi, 2015. "State Aid to Infrastructure: Do Competitively Selected Operators Obtain an Undue Advantage?," Bruges European Economic Research Papers 33, European Economic Studies Department, College of Europe.
    • Handle: RePEc:coe:wpbeer:33
    as

    Download full text from publisher

    File URL: https://www.coleurope.eu/system/files_force/research-paper/beer33.pdf?download=1
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    State Aid; Competitive Selection; Auction Theory; Concession Fees; Funding Gap;
    All these keywords.

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • L38 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Policy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:coe:wpbeer:33. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Jessie Moerman (email available below). General contact details of provider: https://edirc.repec.org/data/eescebe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.