Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/198809 
Year of Publication: 
2019
Series/Report no.: 
CESifo Working Paper No. 7449
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We investigate yardstick competition between local jurisdictions in which pure rent-seeking incumbents undertake an identical infrastructure project choosing be- tween two contractual arrangements with different financing profiles, namely traditional procurement (TP) and public-private partnership (PPP). We show that a mixed regime, in which TP is used in one jurisdiction and PPP in the other, is likely to arise when projects are mildly lucrative, and/or jurisdictions have a moderate fiscal capacity. We find that, in the mixed equilibrium, incumbents provide different levels of public services, face different probabilities of re-election, and obtain different rents. The adoption of different forms of project governance permits incumbents to disguise themselves and undermine voters' ability to assess their performances. Therefore, yardstick competition is hindered, even if jurisdictions display identical revenue capacities.
Subjects: 
political yardstick competition
rent seeking
infrastructure projects
traditional procurement
public-private partnership
JEL: 
D72
H77
Document Type: 
Working Paper
Appears in Collections:

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.