Financing Costs and the Efficiency of Public-Private Partnerships

Besart Avdiu and Alfons Weichenrieder

VfS Annual Conference 2018 (Freiburg, Breisgau): Digital Economy from Verein für Socialpolitik / German Economic Association

Abstract: The paper compares provision of public infrastructure via public-private partnerships (PPPs) with provision under government management. Due to soft budget constraints of government management, PPPs exert more effort and therefore have a cost advantage. At the same time, hard budget constraints for PPPs introduce a bankruptcy risk and bankruptcy costs. Consequently, PPPs may be less efficient, although this does not result from PPPs’ higher interest costs.

JEL-codes: G33 H11 H54 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-cfn and nep-tre
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https://www.econstor.eu/bitstream/10419/181521/1/VfS-2018-pid-12615.pdf (application/pdf)

Related works:
Working Paper: Financing Costs and the Efficiency of Public-Private Partnerships (2020)
Working Paper: Financing costs and the efficiency of public-private partnerships (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc18:181521

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