Efficiency, cost and benefits in contracts of public-private partnerships [Efficiency, cost and benefits in contracts of public-private partnerships]

Rodrigo Fernandez, Andre Carraro and Ronald Otto Hillbrecht
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Ronald Otto Hillbrecht: UFRGS

Nova Economia, 2016, vol. 26, issue 2, 369-392

Abstract: This paper presents a theoretical model in order to better understand the elaboration of Public-Private Partnership contracts. Starting from the model developed by Iossa and Martimort (2012), we consider an additional parameter that measures the sensibility of the effort made in between the stages of the project. We also delimitate the numerical range of the variable that determines the technology flexibility. In this regard, a bundling regime, under which the companies form a consortium, presents better results than when they are contracted separately. This is a consequence of the first model, in which the companies are able to internalize the externalities of the productive process. On the other hand, even though the bundling regime is more efficient, the government should seek mechanisms to monitor the quality of services.

Keywords: public-private partnerships; contracts (search for similar items in EconPapers)
JEL-codes: H54 L14 (search for similar items in EconPapers)
Date: 2016
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