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Choosing hybrid organizations for local servicesdelivery: An empirical analysis of partial privatization

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  • Xavier Fageda

    ()
    (Faculty of Economics, University of Barcelona)

  • Germa Bel

    ()
    (Faculty of Economics, University of Barcelona)

Abstract

The empirical literature about factors explaining local government delivery choices has traditionally focused the attention on the public or private production dilemma. However, hybrid organizational forms such as mixed public-private firms are increasingly used in several European countries. This paper makes use of survey data from Spanish municipalities to examine motivations of local governments for engaging in hybrid organizational forms. Data refer to two very relevant local services: water distribution and solid waste collection. The empirical analysis indicates that the use of mixed firms emerge as a type of pragmatically based ‘third way’ between pure public and pure private production. Indeed, local governments make use of mixed firms when cost considerations (scale economies, transaction costs and so on), financial constraints and private interests exert contradictory pressures. On the contrary, political and ideological factors do not play any significant role on the local government decision of engaging or not in joint ventures with private partners.

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Bibliographic Info

Paper provided by University of Barcelona, Research Institute of Applied Economics in its series IREA Working Papers with number 200803.

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Length: 21 pages
Date of creation: Apr 2008
Date of revision: Apr 2008
Handle: RePEc:ira:wpaper:200803

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Postal: Tinent Coronel Valenzuela, Num 1-11 08034 Barcelona
Web page: http://www.ub.edu/irea/
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Keywords: Partial privatization; local governments;

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  4. Elbert Dijkgraaf & Raymond H J M Gradus, 2008. "Institutional developments in the Dutch waste-collection market," Environment and Planning C: Government and Policy, Pion Ltd, London, vol. 26(1), pages 110-126, February.
  5. Germa Manel Bel Queralt & Antonio Miralles, 2002. "Factors influencing privatization of urban solid waste collection: some evidence from Spain," Working Papers in Economics 74, Universitat de Barcelona. Espai de Recerca en Economia.
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  9. Williamson, Oliver E, 1999. "Public and Private Bureaucracies: A Transaction Cost Economics Perspective," Journal of Law, Economics and Organization, Oxford University Press, vol. 15(1), pages 306-42, April.
  10. Patrick W. Schmitz, 2000. "Partial Privatization and Incomplete Contracts: The Proper Scope of Government Reconsidered," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 57(4), pages 394-411, August.
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  12. Germa Bel & Anton Costas, 2006. "Do Public Sector Reforms Get Rusty? Local Privatization in Spain," Journal of Economic Policy Reform, Taylor & Francis Journals, vol. 9(1), pages 1-24.
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Cited by:
  1. Michael Artis & Ernest Miguélez & Rosina Moreno, 2009. "Assessing agglomeration economies in a spatial framework with endogenous regressors," LSE Research Online Documents on Economics 33239, London School of Economics and Political Science, LSE Library.
  2. David Castells & Vicente Royuela, 2011. "Agglomeration, Inequality and Economic Growth," IREA Working Papers 201114, University of Barcelona, Research Institute of Applied Economics, revised Apr 2012.
  3. Germà Bel & Xavier Fageda & Melania Mur, 2011. "Why do municipalities cooperate to provide local public services? An empirical analysis," IREA Working Papers 201118, University of Barcelona, Research Institute of Applied Economics, revised Oct 2011.
  4. Lluís Bermúdez & Antoni Ferri & Montse Guillén, 2011. "A correlation sensitivity analysis of non-life underwriting risk in solvency capital requirement estimation," IREA Working Papers 201113, University of Barcelona, Research Institute of Applied Economics, revised Sep 2011.
  5. Juan Luis Jiménez & Jordi Perdiguero & Ancor Suárez, 2011. "Debating as a classroom tool for adapting learning outcomes to the European higher education area," IREA Working Papers 201109, University of Barcelona, Research Institute of Applied Economics, revised Jun 2011.
  6. Miguel Santolino & Catalina Bolancé & Manuela Alcañiz, 2011. "Factors affecting hospital admission and recovery stay duration of in-patient motor victims in Spain," IREA Working Papers 201119, University of Barcelona, Research Institute of Applied Economics, revised Oct 2011.

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