Resource title

The basic public finance of public-private partnerships

Resource image

image for OpenScout resource :: The basic public finance of public-private partnerships

Resource description

Public-private partnerships (PPPs) cannot be justified because they free public funds. When PPPs are justified on efficiency grounds, the contract that optimally balances demand risk, user-fee distortions and the opportunity cost of public funds, features a minimum revenue guarantee and a revenue cap. However, observed revenue guarantees and revenue sharing arrangements differ from those suggested by the optimal contract. Also, this contract can be implemented via a competitive auction with realistic informational requirements. Finally, the allocation of risk under the optimal contract suggests that PPPs are closer to public provision than to privatization.

Resource author

Eduardo M. R. A. Engel, Ronald D. Fischer, Alexander Galetovic

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/26996

Resource license

Adapt according to the presented license agreement and reference the original author.