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Myopic PPPs: Risk allocation and hidden liabilities for taxpayers and users

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  • Bel, Germà
  • Bel-Piñana, Paula
  • Rosell, Jordi

Abstract

Drawing on evidence from three case studies, we show how the State's Financial Liability has worked in assigning risk in large PPP contracts in Spain. Project failure and the concessionaires' bankruptcy have resulted in the government having to assume heavy financial obligations, which have ultimately been absorbed by taxpayers and users. In contrast, Spain's leading construction companies, which were also major investors in the concessionaires, have been able to minimize their risk. Myopic PPPs have been entered into based on the transference of liabilities to taxpayers and users, and the, consequent, minimization of risks for the main private investors.

Suggested Citation

  • Bel, Germà & Bel-Piñana, Paula & Rosell, Jordi, 2017. "Myopic PPPs: Risk allocation and hidden liabilities for taxpayers and users," Utilities Policy, Elsevier, vol. 48(C), pages 147-156.
    • Handle: RePEc:eee:juipol:v:48:y:2017:i:c:p:147-156
    DOI: 10.1016/j.jup.2017.06.002
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    References listed on IDEAS

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    12. repec:hal:pseose:halshs-01109351 is not listed on IDEAS
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    Cited by:

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    2. Baños-Pino, José F. & Boto-García, David & Zapico, Emma, 2021. "Persistence and dynamics in the efficiency of toll motorways: The Spanish case," Efficiency Series Papers 2021/03, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
    3. Daniel Albalate & Germà Bel & Albert Gragera, 2018. "“When politics and lobbyism combine to promote white elephants by using PPPs”," IREA Working Papers 201823, University of Barcelona, Research Institute of Applied Economics, revised Oct 2018.
    4. Jiangfan Liu & Xiongzhi Xue, 2018. "River Management for Local Governments in China: From Public to Private," IJERPH, MDPI, vol. 15(10), pages 1-11, October.
    5. Daniel, Albalate & Germà, Bel & Albert, Gragera, 2019. "Politics, risk, and white elephants in infrastructure PPPs," Utilities Policy, Elsevier, vol. 58(C), pages 158-165.
    6. Baños-Pino, José F. & Boto-García, David & Zapico, Emma, 2022. "Persistence and dynamics in the efficiency of toll motorways: The Spanish case," Economics of Transportation, Elsevier, vol. 31(C).
    7. Laura Garrido & José Manuel Vassallo, 2020. "Is Ex-Post Fiscal Support to PPPs Sustainable? Analysis of Government Loans Granted to Shadow-Toll Roads in Spain: A Case Study," Sustainability, MDPI, vol. 13(1), pages 1-23, December.
    8. Zapico, Emma & Baños-Pino, José F. & Mayor, Matías, 2024. "Optimal toll rates accounting for traffic accidents: A productive efficiency approach," Transportation Research Part A: Policy and Practice, Elsevier, vol. 181(C).
    9. Välilä, Timo, 2020. "An overview of economic theory and evidence of public-private partnerships in the procurement of (transport) infrastructure," Utilities Policy, Elsevier, vol. 62(C).
    10. Rivas, Marcela González & Schroering, Caitlin, 2021. "Pittsburgh's translocal social movement: A case of the new public water," Utilities Policy, Elsevier, vol. 71(C).

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