The regulatory function in public-private partnerships for the provision of transport infrastructure
A wide range of contractual arrangements are increasingly being used by the public sector to materialise the delegation of transport infrastructure provision tasks to the private sector, over long periods of time. This paper addresses the issue of transport infrastructure regulation in the specific context of public-private settings. Starting by the discussion on the concept of Public-Private Partnership (PPP) it is stressed that, despite the different meanings that can be found in the literature, it is possible to define a PPP by using a core group of characteristics, such as the bundling of services and the transference of a relevant part of the risks to the private sector on a long term basis. Regarding the action of the regulator, we look at three dimensions of efficiency that are expected to be pursued at the strategic level of regulatory action. However, it is acknowledged that the regulatory function is in practice rather complex since it requires balancing a multiplicity of other objectives or goals, which may vary according to specific economic conditions. In the domain of pricing, the review carried out suggests that since "first best" assumptions are not met in the "real world" it hardly seems possible that the short run marginal cost pricing "canon" could be directly used to shape pricing policies. Consequently, when considering the application of the standard neoclassical marginal cost pricing approach it is pertinent to ask whether the second best solutions can lead to efficient outcomes that might be accepted by the stakeholders. Bundling construction and maintenance tasks into a single long term contract, which is a typical characteristic of "standard" PPPs, could theoretically bring cost benefits since it allows for the possible internalization of any positive externalities that may be generated during the whole project life cycle. The economic rationale for the bundling of construction/maintenance with financing services is that it enhances the likelihood of submission of realistic bids at the procurement stage. In addition, the chances of the contractor sticking to the agreed contractual terms, after contract award, are potentially increased given the higher exposure to financial risk.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 30 (2010)
Issue (Month): 1 ()
|Contact details of provider:|| Web page: http://www.elsevier.com/wps/find/journaldescription.cws_home/620614/description#description|
|Order Information:|| Postal: http://www.elsevier.com/wps/find/supportfaq.cws_home/regional|
References listed on IDEAS
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.:
- Oi, Walter Y, 1971. "A Disneyland Dilemma: Two-Part Tariffs for a Mickey Mouse Monopoly," The Quarterly Journal of Economics, MIT Press, vol. 85(1), pages 77-96, February.
- Baumol, William J & Bradford, David F, 1970. "Optimal Departures from Marginal Cost Pricing," American Economic Review, American Economic Association, vol. 60(3), pages 265-83, June.
- De Borger, Bruno, 2000.
"Optimal two-part tariffs in a model of discrete choice,"
Journal of Public Economics,
Elsevier, vol. 76(1), pages 127-150, April.
- DE BORGER; Bruno, . "Optimal two-part tariffs in a model of discrete choice," Working Papers 1999005, University of Antwerp, Faculty of Applied Economics.
- DE BORGER, Bruno, .
"Discrete choice models and optimal two-part tariffs in the presence of externalities: Optimal taxation of cars,"
2000021, University of Antwerp, Faculty of Applied Economics.
- De Borger, Bruno, 2001. "Discrete choice models and optimal two-part tariffs in the presence of externalities: optimal taxation of cars," Regional Science and Urban Economics, Elsevier, vol. 31(4), pages 471-504, July.
- repec:sae:ecolab:v:19:y:2009:i:2:p:69-90 is not listed on IDEAS
- Henrik Jacobsen Kleven & Claus Thustrup Kreiner, 2003. "The Marginal Cost of Public Funds in OECD Countries. Hours of Work Versus Labor Force Participation," CESifo Working Paper Series 935, CESifo Group Munich.
- Castano-Pardo, Alberto & Garcia-Diaz, Alberto, 1995. "Highway cost allocation: An application of the theory of nonatomic games," Transportation Research Part A: Policy and Practice, Elsevier, vol. 29(3), pages 187-203, May.
- Small, Kenneth & Yan, Jia, 2000.
"The Value of "Value Pricing" of Roads: Second-Best Pricing and Product Differentiation,"
dp-00-08, Resources For the Future.
- Small, Kenneth A. & Yan, Jia, 2001. "The Value of "Value Pricing" of Roads: Second-Best Pricing and Product Differentiation," Journal of Urban Economics, Elsevier, vol. 49(2), pages 310-336, March.
- Small, Kenneth A. & Yan, Jia, 2001. "The Value of "Value Pricing" of Roads: Second-Best Pricing and Product Differentiation," University of California Transportation Center, Working Papers qt9569k1sz, University of California Transportation Center.
- Small, K.A. & Yan, J., 1999. "The Value of "Value Princing" of Roads: Second-Best Pricing and Product Differentiation," Papers 99-00-02, California Irvine - School of Social Sciences.
- Antonio Estache & Tim Coelli & Sergio Perelman & Lourdes Trujillo, 2003.
"A Primer on Efficiency Measurement for Utilities and Transport Regulators,"
ULB Institutional Repository
2013/44106, ULB -- Universite Libre de Bruxelles.
- Tim Coelli & Antonio Estache & Sergio Perelman & Lourdes Trujillo, 2003. "A Primer on Efficiency Measurement for Utilities and Transport Regulators," World Bank Publications, The World Bank, number 15149, September.
- Slemrod, Joel, 1990.
"Optimal Taxation and Optimal Tax Systems,"
Journal of Economic Perspectives,
American Economic Association, vol. 4(1), pages 157-78, Winter.
- Oliver Hart, 2002.
"Incomplete Contracts and Public Ownership: Remarks, and an Application to Public-Private Partnerships,"
The Centre for Market and Public Organisation
02/061, Department of Economics, University of Bristol, UK.
- Oliver Hart, 2003. "Incomplete Contracts and Public Ownership: Remarks, and an Application to Public-Private Partnerships," Economic Journal, Royal Economic Society, vol. 113(486), pages C69-C76, March.
- Guesnerie, R., 1994.
"The Genealogy of Modern Theoretical Public Economics: From first best to second best,"
DELTA Working Papers
94-25, DELTA (Ecole normale supérieure).
- Guesnerie, R., 1995. "The genealogy of modern theoretical public economics: From first best to second best," European Economic Review, Elsevier, vol. 39(3-4), pages 353-381, April.
- Rothengatter, Werner, 2003. "How good is first best? Marginal cost and other pricing principles for user charging in transport," Transport Policy, Elsevier, vol. 10(2), pages 121-130, April.
- Kuwahara, Masao, 2007. "A theory and implications on dynamic marginal cost," Transportation Research Part A: Policy and Practice, Elsevier, vol. 41(7), pages 627-643, August.
- Mandy, David M, 1991. "Competitive Two-Part Tariffs as a Response to Differential Rates of Time Preference," Economica, London School of Economics and Political Science, vol. 58(231), pages 377-89, August.
- Marvin Kraus, 1981. "Indivisibilities, Economies of Scale, and Optimal Subsidy Policy for Freeways," Land Economics, University of Wisconsin Press, vol. 57(1), pages 115-121.
- Robin Lindsey, 2006. "Do Economists Reach A Conclusion on Road Pricing? The Intellectual History of an Idea," Econ Journal Watch, Econ Journal Watch, vol. 3(2), pages 292-379, May.
- Jean-Jacques Laffont & Jean Tirole, 1993. "A Theory of Incentives in Procurement and Regulation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121743, June.
- Vickrey, William S, 1969. "Congestion Theory and Transport Investment," American Economic Review, American Economic Association, vol. 59(2), pages 251-60, May.
- Robert D. Willig, 1978. "Pareto-Superior Nonlinear Outlay Schedules," Bell Journal of Economics, The RAND Corporation, vol. 9(1), pages 56-69, Spring.
- Paul Klemperer, 2004.
"Auctions: Theory and Practice,"
Economics Series Working Papers
2004-W09, University of Oxford, Department of Economics.
- Athias, Laure & Saussier, Stéphane, 2007. "Contractual flexibility or rigidity for public private partnerships? Theory and evidence from infrastructure concession contracts," MPRA Paper 10541, University Library of Munich, Germany.
- Paul Klemperer, 2004.
"Introduction to Auctions: Theory and Practice
[Auctions: Theory and Practice]," Introductory Chapters, Princeton University Press.
- International Monetary Fund, 2009. "The Effects of the Financial Crisison Public-Private Partnerships," IMF Working Papers 09/144, International Monetary Fund.
- Henry Tam, 2004. "The Humean Critique of Lump Sum Taxation (or the Implausibility of Pure Lump Sum Taxes in Autocracy)," Public Choice, Springer, vol. 118(1_2), pages 61-76, 01.
- Antonio Estache & Ginés de Rus, 2000. "The Regulation of Transport Infrastructure and Services: A Conceptual Overview," ULB Institutional Repository 2013/44070, ULB -- Universite Libre de Bruxelles.
- Hau, Timothy D., 1992. "Economic fundamentals of road pricing : a diagrammatic analysis," Policy Research Working Paper Series 1070, The World Bank.
- Yang, Hai & Meng, Qiang, 2002. "A note on "highway pricing and capacity choice in a road network under a build-operate-transfer scheme"," Transportation Research Part A: Policy and Practice, Elsevier, vol. 36(7), pages 659-663, August.
- Richard Arnott & Tilmann Rave & Ronnie Schöb, 2005. "Alleviating Urban Traffic Congestion," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262012197, June.
- Ng, Yew-Kwang & Weisser, Mendel, 1974. "Optimal Pricing with a Budget Constraint-The Case of the Two-part Tariff," Review of Economic Studies, Wiley Blackwell, vol. 41(3), pages 337-45, July.
- Mas-Colell, Andreu & Whinston, Michael D. & Green, Jerry R., 1995. "Microeconomic Theory," OUP Catalogue, Oxford University Press, number 9780195102680.
- Quinet, Emile, 2005. "Alternative Pricing Doctrines," Research in Transportation Economics, Elsevier, vol. 14(1), pages 19-47, January.
- Ashley C. Brown & Jon Stern & Bernard Tenenbaum, 2006. "Handbook for Evaluating Infrastructure Regulatory Systems," World Bank Publications, The World Bank, number 7030, September.
- Wilson, Robert, 1997. "Nonlinear Pricing," OUP Catalogue, Oxford University Press, number 9780195115826.
- Erik T. Verhoef, 2000. "articles: The implementation of marginal external cost pricing in road transport Long run vs short run and first-best vs second-best," Papers in Regional Science, Springer, vol. 79(3), pages 307-332.
- Spence, Michael, 1977. "Nonlinear prices and welfare," Journal of Public Economics, Elsevier, vol. 8(1), pages 1-18, August.
- Verhoef, Erik, 1995. "The demand curve under road pricing and the problem of political feasibility: A comment," Transportation Research Part A: Policy and Practice, Elsevier, vol. 29(6), pages 459-465, November.
- Keeler, Theodore E & Small, Kenneth A, 1977. "Optimal Peak-Load Pricing, Investment, and Service Levels on Urban Expressways," Journal of Political Economy, University of Chicago Press, vol. 85(1), pages 1-25, February.
- van Vuuren, Daniel, 2002. "Optimal pricing in railway passenger transport: theory and practice in The Netherlands," Transport Policy, Elsevier, vol. 9(2), pages 95-106, April.
When requesting a correction, please mention this item's handle: RePEc:eee:retrec:v:30:y:2010:i:1:p:110-125. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.