Government Concession Contracts in Chile: The Role of Competition in the Bidding Process
AbstractOver the last 12 years, Chile has been very successful in attracting private participation in the provision of public infrastructure. Private capital has gone into road infrastructure, ports, and airports all over the country in the form of concessions. The aim of the 1991 Concession Law and that of the specific contracts associated with each project has been to provide much-needed infrastructure efficiently, without committing government resources better employed elsewhere. Using the contracts of four infrastructure projects involving the private sector in Chile, we show that, even though these projects and the concessions program are positively evaluated, design flaws in the auction setup directly or indirectly reduced competition in the bidding process, negatively affected performance, created incentives for ex post renegotiation, and precluded welfare maximization.
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Bibliographic InfoArticle provided by University of Chicago Press in its journal Economic Development and Cultural Change.
Volume (Year): 53 (2004)
Issue (Month): 1 (October)
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Web page: http://www.journals.uchicago.edu/EDCC/
Other versions of this item:
- Ricardo Paredes & JosÃ© Miguel SÃ¡nchez, 2003. "Government Concession Contracts in Chile: The Role of Competition in the Bidding Process," Documentos de Trabajo 258, Instituto de Economia. Pontificia Universidad Católica de Chile..
- L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
- L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
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- Isidro Hernández, 2003. "Las privatizaciones en Colombia," REVISTA APUNTES DEL CENES, UNIVERSIDAD PEDAGOGICA Y TECNOLOGICA DE COLOMBIA.
- Ricardo D.Paredes & Luis I.Rizzi & Javier Valenzuela, 2006. "¿Cazabobos o salvavidas? : la economía política de los fotorradares en Chile," Estudios de Economia, University of Chile, Department of Economics, vol. 33(2 Year 20), pages 97-116, December.
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