Public–private partnerships versus traditional procurement: An experimental investigation

Eva Hoppe, David Kusterer and Patrick Schmitz

Journal of Economic Behavior & Organization, 2013, vol. 89, issue C, 145-166

Abstract: A government agency wants an infrastructure-based public service to be provided. Our experimental study compares two different modes of provision. In a public–private partnership, the two tasks of building the infrastructure and operating it are delegated to one private contractor (a consortium), while under traditional procurement, these tasks are delegated to separate contractors. We find support for the theoretical prediction that, compared to traditional procurement, a public–private partnership provides stronger incentives to make cost-reducing investments (which may increase or decrease service quality). In two additional treatments, we study governance structures which explicitly take subcontracting within private consortia into account.

Keywords: Public–private partnerships; Procurement; Incomplete contracts; Experiment (search for similar items in EconPapers)
JEL-codes: D86 H11 L33 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (61)

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Related works:
Working Paper: Public-private partnerships versus traditional procurement: An experimental investigation (2011)
Working Paper: Public-private partnerships versus traditional procurement: An experimental investigation (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:89:y:2013:i:c:p:145-166

DOI: 10.1016/j.jebo.2011.05.001

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