Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/123852
Authors: 
REGE, Sameer
FORTUNA, Mario
Year of Publication: 
2013
Series/Report no.: 
53rd Congress of the European Regional Science Association: "Regional Integration: Europe, the Mediterranean and the World Economy", 27-31 August 2013, Palermo, Italy
Abstract: 
This paper analysis the welfare changes arising from a road project, undertaken as a public-private partnership, measured as the variation in utility, using a sequentially dynamic general equilibrium model. To circumvent the budget restriction imposed by the central government, the Azorean Regional Government embarked on a partnership to build a major road. The initial investment is supported by the private partner and, subsequently, amortised over a period. Payments are simulated through an increase in income taxes or a reduction in transfer payments, while taking into account the impact of the more efficient infrastructure through a reduction in the transport margins. It is found that under any type of repayment scheme the welfare benefits do not justify the road construction thus making it a poor investment decision.
JEL: 
D58
H40
R15
R58
Document Type: 
Conference Paper

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