Public-private partnerships versus traditional procurement: Innovation incentives and information gathering

Patrick Schmitz and Eva Hoppe

No 7681, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: A government agency wants a facility to be built and managed to provide a public service. Two different modes of provision are considered. In a public-private partnership, the tasks of building and managing are bundled, while under traditional procurement, these tasks are delegated to separate private contractors. The two modes differ in their incentives to innovate and to gather private information about future costs to adapt the service provision to changing circumstances. Depending on the potential benefits of such adaptations, the government agency's preferred mode of provision may be different from the one that should be chosen from a welfare perspective.

Keywords: Incomplete contracts; Information gathering; Integration versus separation; Public-private partnerships (search for similar items in EconPapers)
JEL-codes: D86 H11 L33 (search for similar items in EconPapers)
Date: 2010-02
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Related works:
Journal Article: Public-private partnerships versus traditional procurement: Innovation incentives and information gathering (2013)
Working Paper: Public-private partnerships versus traditional procurement: Innovation incentives and information gathering (2012)
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