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Incomplete Contracts and Public Ownership: Remarks, and an Application to Public-Private Partnerships

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Author Info
Oliver Hart ()

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Abstract

The question of what should determine the boundaries between public and private firms in an advanced capitalist economy is a highly topical one. In this paper I discuss some recent theoretical thinking on this issue. I divide the paper into two parts. First, I make some general remarks about the relationship between the theoretical literature of privatization and incomplete contracting theories of the firm. Second, I use some of the ideas from this literature to develop a very preliminary model of public-private partnerships.

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Publisher Info
Paper provided by Department of Economics, University of Bristol, UK in its series The Centre for Market and Public Organisation with number 02/061.

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Length: 15 pages
Date of creation: Jul 2002
Date of revision:
Handle: RePEc:bri:cmpowp:02/061

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Related research
Keywords: organizational behaviour; scope of government; publicly provided goods;

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Find related papers by JEL classification:
D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
H1 - Public Economics - - Structure and Scope of Government
H4 - Public Economics - - Publicly Provided Goods

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Hart, Oliver & Shleifer, Andrei & Vishny, Robert W, 1997. "The Proper Scope of Government: Theory and an Application to Prisons," The Quarterly Journal of Economics, MIT Press, vol. 112(4), pages 1127-61, November.
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  2. Timothy Besley & Maitreesh Ghatak, 2001. "Government Versus Private Ownership Of Public Goods," The Quarterly Journal of Economics, MIT Press, vol. 116(4), pages 1343-1372, November. [Downloadable!] (restricted)
    Other versions:
  3. Bennett, John & Elisabetta Iossa, 2002. "Building and Managing Facilities for Public Services," Royal Economic Society Annual Conference 2002 22, Royal Economic Society. [Downloadable!]
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  4. Stephen King, & Rohan Pitchford, 2001. "Private or Public? A Taxonomy of Optimal Ownership and Management Regimes," Governance Working Papers 581, East Asian Bureau of Economic Research. [Downloadable!]
  5. Stephen King & Rohan Pitchford, 2001. "Private or Public? A taxonomy of optimal ownership and management regimes," International and Development Economics Working Papers idec01-5, International and Development Economics. [Downloadable!]
  6. Grout, Paul A, 1997. "The Economics of the Private Finance Initiative," Oxford Review of Economic Policy, Oxford University Press, vol. 13(4), pages 53-66, Winter.
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Roy Chowdhury, Prabal & Roy, Jaideep, 2007. "Public-private Partnerships in Micro-finance: Should NGO Involvement be Restricted?," MPRA Paper 4469, University Library of Munich, Germany. [Downloadable!]
    Other versions:
  2. Carlos Díaz Alvarado & Alejandro Izquierdo & Ugo Panizza, 2004. "Viabilidad fiscal en países de mercados emergentes con un enfoque en Ecuador," RES Working Papers 4372, Inter-American Development Bank, Research Department. [Downloadable!]
  3. Valila, Timo, 2005. "How expensive are cost savings? On the economics of public-private partnerships," EIB Papers 4/2005, European Investment Bank, Economic and Financial Studies. [Downloadable!]
  4. Perotti, Enrico, 2004. "State ownership - a residual role?," Policy Research Working Paper Series 3407, The World Bank. [Downloadable!]
  5. Hans Gersbach & Maija Halonen-Akatwijuka, 2005. "Mixing Private and Public Service Providers and Specialization," The Centre for Market and Public Organisation 05/131, Department of Economics, University of Bristol, UK. [Downloadable!]
  6. Carlos Díaz Alvarado & Alejandro Izquierdo & Ugo Panizza, 2004. "Fiscal Sustainability in Emerging Market Countries with an Application to Ecuador," RES Working Papers 4371, Inter-American Development Bank, Research Department. [Downloadable!]
  7. John Bennett & Elisabetta Iossa, 2007. "Contracting Out Public Service Provision to Not-for-Profit Firms," CEDI Discussion Paper Series 07-08, Centre for Economic Development and Institutions(CEDI), Brunel University. [Downloadable!]
    Other versions:
  8. Schmitz, Patrick W., 2005. "Allocating Control in Agency Problems with Limited Liability and Sequential Hidden Actions," CEPR Discussion Papers 5145, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  9. Eric Maskin & Jean Tirole, 2006. "Public-private Partnerships and Government Spending Limits," Economics Working Papers 0075, Institute for Advanced Study, School of Social Science. [Downloadable!]
    Other versions:
  10. Dewatripont, Mathias & Legros, Patrick, 2005. "Public-private partnerships: contract design and risk transfer," EIB Papers 5/2005, European Investment Bank, Economic and Financial Studies. [Downloadable!]
  11. Dalen, Dag Morten & Moen, Espen R, 2003. "The Proper Scope of Governments When Costs are Contractible," CEPR Discussion Papers 3992, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  12. Jon Stern, 2003. "Regulation and Contracts for Utility Services: Substitutes or Complements? Lessons from UK Railway and Electricity History," Journal of Policy Reform, Taylor and Francis Journals, vol. 6(4), pages 193-215, January. [Downloadable!] (restricted)
  13. Jean-Etienne de Bettignies & Thomas W. Ross, 2004. "The Economics of Public-Private Partnerships," Canadian Public Policy, University of Toronto Press, vol. 30(2), pages 135-154, June. [Downloadable!] (restricted)
  14. Martimort, D. & Sand-Zantman, W., 2004. "Signaling and the Design of Delegated Management for Public Utilities," Cahiers du LASER (LASER Working Papers) 2004.11, LASER (Laboratoire de Science Economique de Richter), Faculty of Economics, University of Montpellier 1. [Downloadable!]
  15. Eduardo Engel & Ronald Fischer & Alexander Galetovic, 2009. "Public-Private Partnerships: when and how," Documentos de Trabajo 257, Centro de Economía Aplicada, Universidad de Chile. [Downloadable!]
  16. Paul Grout, 2002. "Public and Private Sector Discount Rates in Public-Private Partnerships," The Centre for Market and Public Organisation 02/059, Department of Economics, University of Bristol, UK. [Downloadable!]
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