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Partnership contracts, project finance and information asymmetries: from competition for the contract to competition within the contract?

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Author Info

  • Nicolas Dupas

    (Caisses des Dépôts et Consignations - Caisse des dépôts et consignations)

  • Frédéric Marty

    ()
    (GREDEG - Groupe de Recherche en Droit, Economie et Gestion - CNRS : UMR7321 - Université de Nice Sophia Antipolis (UNS), OFCE - OBSERVATOIRE FRANCAIS DES CONJONCTURES ECONOMIQUES - Institut d'Études Politiques (IEP) - Paris)

  • Arnaud Voisin

    (Caisses des Dépôts et Consignations - Caisse des dépôts et consignations)

Registered author(s):

    Abstract

    Private finance has brought to public-private partnerships a third-party overlook on the contracts. Bringing into the appraisal of PPP deals banks and rating agencies results in outsourcing the due diligence of the project to the party best suited to perform it. This reduction in asymmetries of information can occur both in the competition for the market stage or in the competition within the market stage (yardstick competition).At the negotiation stage, funding competition helps to increase the public sector's information on the deal. Of course, the cost of collecting this information should not overweight the savings it induces. In order to maintain competitive pressure through the lifecycle of the project, value testing schemes, as benchmarking or market testing are used. However, they induce concerns about transaction costs and could reduce the certainty about the charge for the public partner.

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    File URL: http://halshs.archives-ouvertes.fr/docs/00/20/23/27/PDF/Marty_Voisin_PFI_december07.pdf
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    Bibliographic Info

    Paper provided by HAL in its series Post-Print with number halshs-00202327.

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    Date of creation: 15 Dec 2011
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    Publication status: Published - Presented, Seminar of Economic Analysis of Public Law and Policies, Chaire MADP, Sciences Po., Paris, 2011, Paris, France
    Handle: RePEc:hal:journl:halshs-00202327

    Note: View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-00202327
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    Web page: http://hal.archives-ouvertes.fr/

    Related research

    Keywords: Private finance initiative; asymmetries of information; funding competition;

    This paper has been announced in the following NEP Reports:

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