IDEAS home Printed from https://ideas.repec.org/p/esy/uefcwp/16024.html
   My bibliography  Save this paper

Public-Private Partnerships as Collaborative Projects: testing the theory on cases from EU and Russia

Author

Listed:
  • Vinogradov, D
  • Shadrina, E

Abstract

Public-private partnerships (PPP) allow involvement of private parties in the provision of public goods. How does this differ from traditional public procurement? We view PPPs as collaborative projects with information frictions. Typical public procurement contracts tackle the problems of asymmetric information. However, not all projects are contractible; some are not profitable enough to ensure participation of the private partner. This is due, in part, to costly information verification, and in part to the profitability requirements of the private party. We demonstrate what specific features of a partnership can improve feasibility of projects, and thus both provide a justification of PPP as a form of public good provision, and demonstrate how and whether it differs from procurement. We then analyse real life examples of PPP projects from the perspective of optimal choice of contracts, involvement of both partners, and the features that make these PPP arrangements superior to public procurement.

Suggested Citation

  • Vinogradov, D & Shadrina, E, 2016. "Public-Private Partnerships as Collaborative Projects: testing the theory on cases from EU and Russia," Essex Finance Centre Working Papers 16024, University of Essex, Essex Business School.
    • Handle: RePEc:esy:uefcwp:16024
    as

    Download full text from publisher

    File URL: https://repository.essex.ac.uk/16024/
    File Function: original version
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Bos, Dieter, 1991. "Privatization: A Theoretical Treatment," OUP Catalogue, Oxford University Press, number 9780198283690.
    2. Martimort, David & Pouyet, Jerome, 2008. "To build or not to build: Normative and positive theories of public-private partnerships," International Journal of Industrial Organization, Elsevier, vol. 26(2), pages 393-411, March.
    3. Brinkerhoff, Jennifer M., 2002. "Assessing and improving partnership relationships and outcomes: a proposed framework," Evaluation and Program Planning, Elsevier, vol. 25(3), pages 215-231, August.
    4. Marina Doroshenko & Ian Miles & Dmitry Vinogradov, 2014. "Knowledge Intensive Business Services: The Russian Experience," Foresight and STI Governance (Foresight-Russia till No. 3/2015), National Research University Higher School of Economics, vol. 8(4), pages 24-39.
      • Marina Doroshenko & Ian Miles & Dmitry Vinogradov, 2014. "Knowledge Intensive business services: the Russian experience," Foresight-Russia Форсайт, CyberLeninka;Федеральное государственное автономное образовательное учреждение высшего образования «Национальный исследовательский университет «Высшая школа экономики», vol. 8(4 (eng)), pages 24-39.
    5. Alchian, Armen A & Demsetz, Harold, 1972. "Production , Information Costs, and Economic Organization," American Economic Review, American Economic Association, vol. 62(5), pages 777-795, December.
    6. Hoppe, Eva I. & Schmitz, Patrick W., 2010. "Public versus private ownership: Quantity contracts and the allocation of investment tasks," Journal of Public Economics, Elsevier, vol. 94(3-4), pages 258-268, April.
    7. Stiglitz, Joseph E., 2002. "New perspectives on public finance: recent achievements and future challenges," Journal of Public Economics, Elsevier, vol. 86(3), pages 341-360, December.
    8. Chen, Bin R. & Chiu, Y. Stephen, 2010. "Public-private partnerships: Task interdependence and contractibility," International Journal of Industrial Organization, Elsevier, vol. 28(6), pages 591-603, November.
    9. Bennett, John & Iossa, Elisabetta, 2006. "Building and managing facilities for public services," Journal of Public Economics, Elsevier, vol. 90(10-11), pages 2143-2160, November.
    10. Fehr, Ernst & Schmidt, Klaus M., 2001. "Theories of Fairness and Reciprocity," Discussion Papers in Economics 14, University of Munich, Department of Economics.
    11. Hans Van Ham & Joop Koppenjan, 2001. "BUILDING PUBLIC-PRIVATE PARTNERSHIPS: Assessing and managing risks in port development," Public Management Review, Taylor & Francis Journals, vol. 3(4), pages 593-616, December.
    12. Guillaume Roels & Uday S. Karmarkar & Scott Carr, 2010. "Contracting for Collaborative Services," Management Science, INFORMS, vol. 56(5), pages 849-863, May.
    13. John Vickers & George Yarrow, 1991. "Economic Perspectives on Privatization," Journal of Economic Perspectives, American Economic Association, vol. 5(2), pages 111-132, Spring.
    14. Fehr, Ernst & Schmidt, Klaus M., 2006. "The Economics of Fairness, Reciprocity and Altruism - Experimental Evidence and New Theories," Handbook on the Economics of Giving, Reciprocity and Altruism, in: S. Kolm & Jean Mercier Ythier (ed.), Handbook of the Economics of Giving, Altruism and Reciprocity, edition 1, volume 1, chapter 8, pages 615-691, Elsevier.
    15. de Bettignies, Jean-Etienne & Ross, Thomas W., 2009. "Public-private partnerships and the privatization of financing: An incomplete contracts approach," International Journal of Industrial Organization, Elsevier, vol. 27(3), pages 358-368, May.
    16. Vining, Aidan R & Boardman, Anthony E, 1992. "Ownership versus Competition: Efficiency in Public Enterprise," Public Choice, Springer, vol. 73(2), pages 205-239, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chih-Yao Huang & Ren-Jye Dzeng, 2019. "Evaluating Ancillary Business Scale for PPP-BOT Projects: A Social Housing BOT Case in Taiwan," Sustainability, MDPI, vol. 11(5), pages 1-17, March.
    2. Lei Yang & Longji Hu & Yifan Li, 2024. "Institutional Environment, Institutional Arrangements, and Risk Identification and Allocation in Public–Private Partnerships: A Multilevel Model Analysis Based on Data from 31 Provinces in China," Sustainability, MDPI, vol. 16(15), pages 1-28, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hoppe, Eva I. & Kusterer, David J. & Schmitz, Patrick W., 2013. "Public–private partnerships versus traditional procurement: An experimental investigation," Journal of Economic Behavior & Organization, Elsevier, vol. 89(C), pages 145-166.
    2. Benedetto Manganelli & Francesco Tajani, 2014. "Optimised management for the development of extraordinary public properties," Journal of Property Investment & Finance, Emerald Group Publishing Limited, vol. 32(2), pages 187-201, February.
    3. Schmitz, Patrick W., 2013. "Job design with conflicting tasks reconsidered," European Economic Review, Elsevier, vol. 57(C), pages 108-117.
    4. Schmitz, Patrick W., 2013. "Public procurement in times of crisis: The bundling decision reconsidered," Economics Letters, Elsevier, vol. 121(3), pages 533-536.
    5. Halonen-Akatwijuka, Maija, 2012. "Nature of human capital, technology and ownership of public goods," Journal of Public Economics, Elsevier, vol. 96(11), pages 939-945.
    6. Eva I. Hoppe & Patrick W. Schmitz, 2013. "Public-private partnerships versus traditional procurement: Innovation incentives and information gathering," RAND Journal of Economics, RAND Corporation, vol. 44(1), pages 56-74, March.
    7. Jean-Etienne de Bettignies & Thomas W. Ross, 2010. "The Economics of Public–Private Partnerships: Some Theoretical Contributions," Chapters, in: Graeme A. Hodge & Carsten Greve & Anthony E. Boardman (ed.), International Handbook on Public–Private Partnerships, chapter 7, Edward Elgar Publishing.
    8. Li, Sanxi & Sun, Hailin & Yan, Jianye & Yu, Jun, 2015. "Bundling decisions in procurement auctions with sequential tasks," Journal of Public Economics, Elsevier, vol. 128(C), pages 96-106.
    9. David Martimort & Flavio Menezes & Myrna Wooders & ELISABETTA IOSSA & DAVID MARTIMORT, 2015. "The Simple Microeconomics of Public-Private Partnerships," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 17(1), pages 4-48, February.
    10. Herrera Dappe,Matias & Melecky,Martin & Turkgulu,Burak, 2022. "Fiscal Risks from Early Termination of Public-Private Partnerships in Infrastructure," Policy Research Working Paper Series 9972, The World Bank.
    11. Kosuke Oshima, 2016. "Public-Private Partnerships, Dividing Operational Stage, and Optimal Governance Structures," Public Organization Review, Springer, vol. 16(4), pages 443-459, December.
    12. David Martimort & Flavio Menezes & Myrna Wooders & DANIEL DANAU & ANNALISA VINELLA, 2015. "Public-Private Contracting under Limited Commitment," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 17(1), pages 78-110, February.
    13. Chen, Zhenhua & Daito, Nobuhiko & Gifford, Jonathon L., 2014. "Do State Fiscal Constraints Affect Implementation of Highway Public-Private Partnerships? A Panel Fixed Logit Assessment," Journal of the Transportation Research Forum, Transportation Research Forum, vol. 53(2).
    14. David Martimort & Flavio Menezes & Myrna Wooders & LUCIANO GRECO, 2015. "Imperfect Bundling in Public–Private Partnerships," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 17(1), pages 136-146, February.
    15. David Martimort & Stéphane Straub, 2016. "How To Design Infrastructure Contracts In A Warming World: A Critical Appraisal Of Public–Private Partnerships," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 57(1), pages 61-88, February.
    16. Eva I. Hoppe & Patrick W. Schmitz, 2021. "How (Not) to Foster Innovations in Public Infrastructure Projects," Scandinavian Journal of Economics, Wiley Blackwell, vol. 123(1), pages 238-266, January.
    17. Ram Singh, 2018. "Public–private partnerships vs. traditional contracts for highways," Indian Economic Review, Springer, vol. 53(1), pages 29-63, December.
    18. Schmitz, Patrick W., 2015. "Government versus private ownership of public goods: The role of bargaining frictions," Journal of Public Economics, Elsevier, vol. 132(C), pages 23-31.
    19. Anke S. Kessler & Christoph Lülfesmann, 2002. "Monitoring and Productive Efficiency in Public and Private Firms," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 58(2), pages 167-187, February.
    20. Athena Roumboutsos & St�phane Saussier, 2014. "Public-private partnerships and investments in innovation: the influence of the contractual arrangement," Construction Management and Economics, Taylor & Francis Journals, vol. 32(4), pages 349-361, April.

    More about this item

    Keywords

    HG; public-private partnerships; public finance; contracting;
    All these keywords.

    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:esy:uefcwp:16024. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Nikolaos Vlastakis (email available below). General contact details of provider: https://edirc.repec.org/data/fcessuk.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.