The Simple Microeconomics of Public-Private Partnerships

摘要: We build on the existing literature in public-private partnerships (PPP) to analyze main incentive issues PPPs and shape of optimal contracts those contexts. present a basic model procurement multitask environment which risk-averse firm chooses noncontractible efforts cost reduction quality improvement. first consider effect incentives risk transfer bundling building management stages into single contract, allowing for different assumptions feasible information available government. Then we extend novel directions. study relationship between operator its financiers impact private finance. discuss trade-off flexibility PPP agreements dynamics PPPs, including overruns. also how institutions, specifically regulatory opportunism, affect contract design incentives. The conclusion summarizes policy implications desirability PPPs.