IDEAS home Printed from https://ideas.repec.org/a/plo/pone00/0337404.html

The influence of local officials’ promotion incentives on Public-Private Partnership project investment from a political-performance-driven perspective: Empirical evidence from China

Author

Listed:
  • Lisha Zhang
  • Mingyang Yue
  • Shasha Du
  • Rong Zheng
  • Tao Zhu
  • Boyuan Tang

Abstract

The investment in PPP projects in China is large but quite uneven. Based on the political economy theory, using data from the public‒private partnership (PPP) industry issued by local municipal authorities from 2014 to 2018 in China, this paper explains the phenomenon of uneven PPP investment from a politically performance-driven perspective. The study shows that local officials have a strong incentive to increase investment in PPP projects that have positive visual effects on performance appraisal. Driven by promotion incentive, PPP investment demonstrates a phenomenon of “emphasizing performance over livelihood” and “emphasizing aboveground over underground”. The correlation between promotion incentives for municipal party secretaries and the annual incremental investment amount in growth-based PPP categories has an inverted U-shaped curve. Furthermore, the age of mayors has a heterogeneous influence on PPP investment, with those under 52 years of age being more willing to increase investment in growth-based PPP categories, as well as growth-based-visible PPP categories. Our study explores the political reasons for project investment mismatch and reveals the negative effect of local officials’ promotion incentives, which provides empirical experience in China for other countries to explore the relationship between officials’ promotion incentives and project investment.

Suggested Citation

  • Lisha Zhang & Mingyang Yue & Shasha Du & Rong Zheng & Tao Zhu & Boyuan Tang, 2026. "The influence of local officials’ promotion incentives on Public-Private Partnership project investment from a political-performance-driven perspective: Empirical evidence from China," PLOS ONE, Public Library of Science, vol. 21(1), pages 1-20, January.
    • Handle: RePEc:plo:pone00:0337404
    DOI: 10.1371/journal.pone.0337404
    as

    Download full text from publisher

    File URL: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0337404
    Download Restriction: no
    File URL: https://journals.plos.org/plosone/article/file?id=10.1371/journal.pone.0337404&type=printable
    Download Restriction: no
    File URL: https://libkey.io/10.1371/journal.pone.0337404?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. repec:bla:glopol:v:8:y:2017:i:s3:p:5-14 is not listed on IDEAS
    2. Eva I. Hoppe & Patrick W. Schmitz, 2013. "Public-private partnerships versus traditional procurement: Innovation incentives and information gathering," RAND Journal of Economics, RAND Corporation, vol. 44(1), pages 56-74, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yukari Fukuda & Jun-ichi Nakamura, 2021. "Economic Analysis of Public-Private Partnerships in Japan: Theoretical and Empirical Analyses Focusing on Adverse Selection and Synergy Effect," Public Policy Review, Policy Research Institute, Ministry of Finance Japan, vol. 17(2), pages 1-27, November.
    2. Freddy Huet & Simon Porcher, 2013. "Innovation and regulatory outcomes: evidence from the public-private contracts for water supply in France," Chapters, in: Mehmet Ugur (ed.), Governance, Regulation and Innovation, chapter 9, pages 216-236, Edward Elgar Publishing.
    3. Ronit Mukherji, 2023. "Risk Sharing in Public-Private Partnerships," SN Operations Research Forum, Springer, vol. 4(4), pages 1-17, December.
    4. Schmitz, Patrick W., 2013. "Job design with conflicting tasks reconsidered," European Economic Review, Elsevier, vol. 57(C), pages 108-117.
    5. Justin Downs, 2021. "Information gathering by overconfident agents," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 30(3), pages 554-568, August.
    6. Buso, Marco & Moretto, Michele & Zormpas, Dimitrios, 2021. "Excess returns in Public-Private Partnerships: Do governments pay too much?," Economic Modelling, Elsevier, vol. 102(C).
    7. Rianne Warsen, 2022. "The use of research methods in public-private partnership research," Chapters, in: A Research Agenda for Public–Private Partnerships and the Governance of Infrastructure, chapter 3, pages 53-80, Edward Elgar Publishing.
    8. Hodaka Morita & Maroš Servátka, 2016. "Does Group Identity Prevent Inefficient Investment in Outside Options? An Experimental Investigation," Research in Experimental Economics, in: Experiments in Organizational Economics, volume 19, pages 105-126, Emerald Group Publishing Limited.
    9. Marco Buso & Luciano Greco, 2023. "The optimality of public–private partnerships under financial and fiscal constraints," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 32(4), pages 856-881, October.
    10. Novak, David C. & Koliba, Chris & Zia, Asim & Tucker, Matt, 2015. "Evaluating the outcomes associated with an innovative change in a state-level transportation project prioritization process: A case study of Vermont," Transport Policy, Elsevier, vol. 42(C), pages 130-143.
    11. Cian O'SHEA & Dónal PALCIC & Eoin REEVES, 2019. "Comparing Ppp With Traditional Procurement: The Case Of Schools Procurement In Ireland," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 90(2), pages 245-267, June.
    12. Schmitz, Patrick W., 2021. "Optimal ownership of public goods under asymmetric information," Journal of Public Economics, Elsevier, vol. 198(C).
    13. Buso, Marco & Dosi, Cesare & Moretto, Michele, "undated". "Termination Fees and Contract Design in Public-Private Partnerships," ETA: Economic Theory and Applications 281284, Fondazione Eni Enrico Mattei (FEEM).
    14. Achard, Paola Olimpia & Di Berardino, Antonina, 2018. "Public Private Partnerships: Strategic Assets and Managerial Models," 29th European Regional ITS Conference, Trento 2018 184925, International Telecommunications Society (ITS).
    15. Schmitz, Patrick W., 2010. "Contractual solutions to hold-up problems with quality uncertainty and unobservable investments," Journal of Mathematical Economics, Elsevier, vol. 46(5), pages 807-816, September.
    16. Xiuqin Wang & Shufan Wang & Ying Gao, 2023. "Optimal equity structure of PPP projects when private-sector shareholders’ “investor-contractor” dual roles is considered," Construction Management and Economics, Taylor & Francis Journals, vol. 41(11-12), pages 910-925, December.
    17. Páez-Pérez, David & Sánchez-Silva, Mauricio, 2016. "A dynamic principal-agent framework for modeling the performance of infrastructure," European Journal of Operational Research, Elsevier, vol. 254(2), pages 576-594.
    18. Lauri Koskela & John Rooke & Mohan Siriwardena, 2016. "Evaluation of the Promotion of Through-Life Management in Public Private Partnerships for Infrastructure," Sustainability, MDPI, vol. 8(6), pages 1-23, June.
    19. Hang, Ziqi, 2026. "When to persuade and when to pay: Designing incentives for private learning," Journal of Economic Behavior & Organization, Elsevier, vol. 245(C).
    20. Feng, Zhuo & Zhang, Shui-Bo & Gao, Ying, 2015. "Modeling the impact of government guarantees on toll charge, road quality and capacity for Build-Operate-Transfer (BOT) road projects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 78(C), pages 54-67.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:plo:pone00:0337404. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: plosone (email available below). General contact details of provider: https://journals.plos.org/plosone/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.