Public-private partnerships: determinants of the type of governance structure (original) (raw)
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Public Performance & Management Review, 2016
Unlike the case of private hybrid organizational structures, the institutional dimension in a public-private partnership (PPP) is no longer exogenous to the decisions of the partners in a transaction. The public partner, in this type of contract, acts also as regulator and arbitrator when the regulatory bodies and the courts are subject to government influence. This article explores the impact of institutional quality on the expansion of PPP markets in developing countries. The analysis expands on Crocker and Masten's construct for choosing an appropriate organizational structure for the provision of public services. Institutional quality becomes a source of transaction costs on a par with asset specificity and uncertainty, on one hand, and, on the other, it affects the magnitude of the impact of an exogenous unforeseen event. Panel regressions, on a sample of 83 developing countries for the period 1999-2011, provide evidence on the positive impact of judicial independence and regulatory quality in attracting private investors to PPP markets regardless of the degree of uncertainty in the exchange environment.
Identification of barriers to Public Private Partnerships implementation in developing countries
2014
Public Private Partnerships (PPPs) have become an increasingly important method of delivering infrastructure projects in the last decade and are now used in over 40 countries. The adoption and implementation of PPPs in less mature economies can pose different challenges to that of mature economies. Thus, successful PPPs are designed with careful attention to the context or the enabling environment within which the partnerships will be implemented. The growth of PPPs has in many countries increased the availability of resources, the efficiency, and sustainability of public services especially in the fields of transport, energy, water, telecommunications, and health. In developing countries a number of barriers influencing the implementation of PPPs caused diminishing interests of both local and foreign private investors. The purpose of this paper is to identify the barriers in implementing PPPs in developing countries. The paper adopted past research studies and documentary reports a...
Success and failure mechanisms of public private partnerships (PPPs) in developing countries
International Journal of Public Sector Management, 2004
The concept of public private partnerships (PPPs) has attracted worldwide attention and acquired a new resonance in the context of developing countries. PPPs are increasingly heralded as an innovative policy tool for remedying the lack of dynamism in traditional public service delivery. However PPPs have also become mired in a muddle of conceptual ambiguities. This paper sheds light on the PPP concept and the rationale for invoking private participation in developing countries. It also identifies critical success factors and policy requirements for successful PPP implementation. Finally, the paper presents a case study assessment of a postwar PPP initiative in the Lebanese telecommunications sector and draws out lessons for improving the effectiveness and viability of PPP projects in the context of developing countries.
Water Policy (R&R), 2022
Indonesia is extensively promoting Public-Private Partnership (PPP) for infrastructure projects, including in the water sector. However, it is found that it takes two to eight years for water supply system (WSS) PPPs to be procured, likely prompting for higher transaction costs. This research offers an investigation of issues affecting transaction costs in Indonesian PPPs, specifically for water infrastructure project. A case study method was chosen for this paper as it helps explore existing theory in transaction cost in the Indonesian PPP context. Umbulan WSS was chosen as the subject of the case study. It is found that some of the key issues in Umbulan WSS are uncertainties, corruption, knowledge, trust, and coordination problems. Strategic suggestions to reduce transaction costs are developed based on lesson learned in the WSS cases and critical factors addressing broader institutional factors such as trust and coordination problems, which are found to be interlinked with opportunism and corruption. We argue transparent information provision and effective organisation can help to address high transaction cost issues. It is also suggested that appointing capable leaders, doing extensive capacity building to across public sector agencies, synchronizing regulations, and possibly streamlining stakeholders and regulations will help reduce uncertainty and transaction costs in WSS PPPs.
The Emerald Handbook of Public Private Partnerships in Developing and Emerging Economies
2017
The purpose of this chapter is to analyse Public Private Partnerships (PPPs) in the developing and emerging economies as a multifaceted challenge from viewpoint of the 10 keys ‘for’ and ‘against’ PPPs: feasibility; planning; optimization; modernization and development; financing; project delivery; project operation; supervision; user satisfaction and accounting issues. The conceptual model and the reasons were formulated by the authors some 10 years ago, based on the literature and case-study reviews. Relevance of those reasons was verified in practice. The knowledge and critical perspective on the above-stated reasons are relevant for the implementation of PPP projects in any national economy developed, emerging or developing, but it is quintessential for the implementation of PPPs in the economies that are at the early stage of implementation of PPPs. Although for
Public Management Review, 2022
This paper examines the impact of institutional forces – legal origin, current institutions, and institutional stability – and their relationship with the success of 6,805 public – private partnerships (PPPs) deployed in 57 developing economies in the period 1997–2017. The results indicate that better current institutions and higher stability influence the success of PPPs. Furthermore, when legal origin, current institutions, and stability are positively aligned, their interaction has a significant impact on PPPs’ performance. The findings are consistent with complementary and substitution institutional effects, which could help policymakers and practitioners to identify success factors for these agreements.
Public–Private Partnerships, Corruption and Inefficiency
Economics, Management and Sustainability
Governments around the world struggle to provide better services to their citizens on limited budgets. The search for new methods for the production and delivery of public services has given us new concepts such as alternative service delivery (ASD) mechanisms, and more specifically public-private partnerships (PPPs). ASD refers to the full sets of alternative arrangement of public goods and service provisioning and delivery, that would otherwise have been provided directly by the public enterprises alone. This will include PPPs, but will also include contracting out of services and outright privatization. By contrast, a PPP is a long-term contractual arrangement between a government and a private party for the provisioning of assets, and delivery of services that have been traditionally provided by the public sector. It also includes sharing of risk and rewards among the private and the public entities (Iossa and Martimort 2015). PPPs have been widely used in Europe, Canada and the USA as part of a general trend. Even in the developing countries, PPP arrangements have grown steadily since the 1990s. According to the World Bank's Private Participation in Infrastructure (PPI) database, during 1990-2003, about 1000 projects and 47% of investments in Latin American and Caribbean countries involved the use of PPPs. In the central and the This chapter draws on the authous'earlier work, Roy Chowdhury and Roy Chowdhury (2016).
2005
This Policy Discussion Paper should not be reported as representing the views of the IMF. The views expressed in this Policy Discussion Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Policy Discussion Papers describe research in progress by the author(s) and are published to elicit comments and to further debate. Prompted by tight budget constraints and by the desire to raise efficiency, governments around the world have increasingly delegated the provision of a variety of infrastructure services to the private sector. Involving the private sector, however, raises difficult legal and regulatory issues: public-private partnerships (PPPs) are more complex, entail longer-term arrangements than seen in traditional public procurement. This paper discusses four key questions: (i) What are the main legal issues that need to be addressed in order to create a favorable environment for PPPs, and how have these been tackled in various countrie...
An Excursion Into The Public-Private Partnership Jungle: Stop Standardizing But Keep On Mapping!
International Public Management Review, 2014
While the Private Finance Initiative (PFI) is doubtless the most visible Public-Private Partnership (PPP) in the public debate it is by no means the only one. A number of scholars have outlined the ambiguity of the PPP concept beyond PFIs and pointed to the multiplicity of differing types and understandings. Thus, when examining up close, the PPP concept seems to cover a jungle of arrangements and settings. However, inductive explorations across disciplinary and professional borders are still scarce. This article addresses this lack and reviews more than 100 publications for their PPP concepts and classifications. Following, the article first of all identifies the emergence of two dimensions that are differently emphasized by the proposed PPP definitions (1) the coresponsibility dimension and (2) the relational governance dimension. Second, the article finds two differing approaches within each dimension being the interventionist and marketization approach within the co-responsibility dimension and the structural and managerial approach in the relational governance dimension. Third, the reviewed variety of classifications illustrates the infinitive number of criteria that can be used to order the within-concept variety. Thus, while the developed map in this article highlights some (re)occurring and uniting patterns it also points to the inevitable ambiguity of the PPP concept and consequently encourages scholars to stay precise and keep on mapping.
Studies have shown that Public-Private Partnership (PPP) is being adopted globally as alternative to the traditional direct procurement for public goods and services. The synergy from the partnership is expected to produce benefits to all stakeholders, especially the end users. However, earlier studies have shown that there is little empirical work trying to answer why PPPs are more advantageous. Similarly, results of those available ones are contradictory and inconclusive, hence this study. The objective of the study is to evaluate, from the user " s perspectives, the effectiveness of PPP in achieving the envisaged benefits in the delivery of public goods compared to direct procurement. Drawing mainly from the Theory X-efficiency, this study adopted a descriptive survey research design with the Lagos Bus Rapid Transit (BRT) Project as a case study. Interview and questionnaire were used to generate primary data from a population of 100,000 daily averages of BRT passengers. Premised on the population " s homogeneity, 500 respondents were selected using Non-probability (Incidental) Sampling. Data were processed and analysed using both descriptive and inferential statistics with the aid of the Statistical Package for Social Sciences (SPSS). Results showed that PPP has effectively achieved the targeted benefits better than direct public procurement. The paper concluded that PPP has been more effective, and therefore a better option, than public procurement of public services. The study recommended among others that PPP option should be extended to other areas.