Public finances and Public Private Partnerships in the European Union

Alessandra Cepparulo, Giuseppe Eusepi and Luisa Giuriato

MPRA Paper from University Library of Munich, Germany

Abstract: We analyse the Public Private Partnerships (PPPs) in order to account for their uneven distribution among the European Union countries and to identify the motivations of the public actor in selecting PPPs. We focus on the fiscal incentives to overcome budget and borrowing constraints, taking also into account of the political features and institutional frameworks of the countries. Using IMF data over the years 1990-2015, we confirm that the state of public finances impacts on the government’s choice of PPPs: financially constrained governments find the PPP option more attractive due to the possibility of off-balance accounting, while high-debt countries reduce the private investors’ interest in PPP. Fiscal rules increased the PPP bias in the pre-crisis period, while the post-crisis reforms and the increased surveillance seem to better discipline PPP employment. PPPs are, also, confirmed to be under the influence of political competition and government’s preferences for current expenditures.

Keywords: PPPs; fiscal incentives; fiscal rules; political competition; EU (search for similar items in EconPapers)
JEL-codes: H00 H11 H54 H62 H63 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-eec
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Working Paper: Public finances and Public Private Partnerships in the European Union (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:103918

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