Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. This paper presents the results of one of the first systematic analyses of the magnitude and determinants of transaction costs in public-private partnerships (PPPs). Given limited data availability, the analysis is confined to procurement-phase costs of bidding and contract negotiation, thus excluding costs related to contract monitoring and renegotiation in the operational phase. Notably, no attempt is made to compare transaction costs in PPPs to those in traditional public procurement of investment projects, nor to compare them to cost savings achieved through PPPs. Even so, some interesting results emerge. Terms of use: Documents inAs regards the level of transaction costs in the procurement phase, it is estimated that the total costs amount on average to well over 10 percent of the capital value of the project.Transaction costs to the public sector and the winning bidder vary between countries (legal systems) and sectors, and they are significantly higher in small projects (below £25 million) and in projects that take long (over 50 months) to procure. In contrast, neither experience in setting up partnerships nor the number of bidders affect the costs to the public sector and the winning bidder.2

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may be saved and copied for your personal and scholarly purposes.You are not to copy documents for public or commercial purposes, to exhibit the documents publicly, to make them publicly available on the internet, or to distribute or otherwise use the documents in public. licence. www.econstor.eu Theoretical literature suggests a variety of reasons why a public-private partnership (PPP) If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicatedshould exhibit higher costs of construction than traditionally procured public infrastructure projects. The bundling of construction and operation contracts in a PPPgive the private partner greater incentives to make investments in the construction phase to lower subsequent operation and maintenance costs. Also, the transfer of the construction risk to the private partner should be explicitly priced in a PPP. We use data on ex ante construction costs of road projects in Europe to test the existence and the magnitude of any such difference between PPPs and traditional procurement. We estimate the ex ante cost of a PPP road to be, on average, 24% more expensive than a traditionally procured road, all other things equal. This estimate corresponds by and large to reported ex post cost overruns in traditionally procured public roads. To the extent that the two measures are representative, this suggests that the largest part of the ex ante construction cost difference originates from the transfer of construction risk. This, in turn, implies that other possible sources of higher PPP construction costs, including bundling, seem to be of second-order importance in the road sector. The analysis does not allow drawing normative conclusions about the desirability of PPP as a procurement method as it focuses only on one cost component in isolation, without being able to quantify its impact on life-cycle costs and benefits. 3 IntroductionThis paper compares the relative cost of building public infrastructure assets as publicprivate partnerships (PPPs) with traditional public procurement. Ideally, the relative costs and benefits of PPPs should be evaluated over the entire project lifecycle, from start of construction through operations and maintenance to the end of the contract period. However, the widespread use of PPP procurement only started to take off 4 in the mid-1990...

No abstract

Public–private partnerships, Risk transfer, Construction cost, European roads, L33, H54, C51,

The aim of this paper is to analyze the effect of revenue decentralization on the provision of infrastructure at the sub-national level. We estimate the effects of revenue decentralization and earmarked grant financing on the level of sub-national infrastructure investment in 20 European countries over the period 1990-2009. The results are interpreted in light of the predictions of the theory on fiscal federalism. We find that it is sub-national infrastructure investment that increases after revenue decentralization and not investment in redistribution. However, the effect of revenue decentralization is lower the higher the use of earmarked grants to fund infrastructure investment.JEL Codes: H54, H77, H76, C23