Delegation of Contracting in the Private Provision of Public Services

John Bennett () and Elisabetta Iossa ()

Economics and Finance Discussion Papers from Economics and Finance Section, School of Social Sciences, Brunel University

Abstract: We use an incomplete-contract approach to compare contracting out by a public sector agency with the delegation of contracting out to a public-private partnership(PPP) that is a joint venture between private and sector agents. The PPP maximizes a linear combination of profit and social benefit. Such delegation may be desirable to curb innovations that reduce the coset of provision but also reduce social benefit. Delegation may be undesirable for innovations that increase social benefit but also raise costs. Our results are explained in term of the shadow cost of public funds and the negociating stance of the PPP.

New Economics Papers: this item is included in nep-pbe
Date: 2005-06
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Related works:
Working Paper: Delegation of Contracting in the Private Provision of Public Services (2005)
Journal Article: Delegation of Contracting in the Private Provision of Public Services (2006)
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Persistent link: http://EconPapers.repec.org/RePEc:bru:bruedp:05-15

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