Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/50538 
Authors: 
Year of Publication: 
2011
Series/Report no.: 
Working Paper No. 98
Publisher: 
Universität Leipzig, Wirtschaftswissenschaftliche Fakultät, Leipzig
Abstract: 
The application and design of public-private partnerships between the extremes of purely public or purely private task fulfilment in public services is, in practice, subject to political processes. Decisions about PPPs (realisation, arrangement) are taken in the political arena and are therefore not theoretical optimisation exercises. The interests and resources of the actors who participate in the political decision-making process as well as the rules of the political process have a powerful influence on whether, in what areas, and in what form PPPs are realised. The distance between this output and solutions that are theoretically desirable given certain ideal goals (e.g. efficiency) and conditions can be referred to as political bias. So what role does the political process play in the realisation of PPPs, in the actual design of PPPs, and in their performance? Using public choice and institutional economics theory this paper analyses what chances of success PPPs have given the existing decision-making structures and the inherent incentives for participating actors, and in what way political influence is brought to bear in the first place. Furthermore, aspects of political science in this field (legitimacy, democratic control) are considered as well. Using PPPs there might be a trade-off between reduced democratic control, but also reinforced market control. It turns out that political involvement might be both an important driver as well as an obstacle for (efficient) PPPs and that it is likely to decrease efficiency either way. A case study for userfinancing PPPs in the transport sector highlights the problems of political renitency.
Subjects: 
public-private partnership
politics
bureaucracy
public choice
contract theory
agency
tax state
transaction cost
governance
legitimacy
transport infrastructure
user financing
JEL: 
D72
D73
D78
H11
H44
H63
H83
Document Type: 
Working Paper

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