IDEAS home Printed from https://ideas.repec.org/p/wiw/wiwrsa/ersa03p68.html
   My bibliography  Save this paper

The Regional Effects of Experience with the Private Finance of Transport Infrastructure: Some Evidence from the UK

Author

Listed:
  • Roger Vickerman

    ()

Abstract

Private finance of transport infrastructure, either through direct private provision or through public-private partnerships has developed rather further in the UK than in most European countries over the past two decades. It is appropriate to consider what lessons can be drawn from this experience. In particular, does the emphasis on private finance lead to a bias in the spatial allocation of investment and what are the consequences of this. The paper discusses a theoretical framework which identifies the importance of the contractual structure for private finance. This shows how in the presence of asymmetric information it is difficult to achieve the expected shifting of risks to the private sector. Given the complexity of such contractual structures, although transactions costs become more transparent, they may also be expected to be higher than in a vertically integrated public sector provider. The benefits may thus depend on the private sector being able to manage the process of investment and introduction into service more efficiently than traditional public sector transport providers. This paper reviews the UK experience in terms of developments of the national air, rail and road networks and local public transport (especially light rail systems). The paper highlights the variety of methods of introducing private finance and assesses these against the criteria of risk bearing, transaction cost reduction, and efficiency in delivery. The key problems are identified as relating to the treatment of network effects and the vertical separation of infrastructure and service (unbundling). The framework is then used to assess the extent to which private sector provision impacts on regional development either positively, by advancing the provision of infrastructure which can provide wider benefits, or negatively by becoming a drag on future development by imposing higher costs of infrastructure usage and maintenance. It becomes clear that a distinction needs to be drawn between infrastructure which is mainly used for intra-regional transport and that which has an inter-regional or international dimension.

Suggested Citation

  • Roger Vickerman, 2003. "The Regional Effects of Experience with the Private Finance of Transport Infrastructure: Some Evidence from the UK," ERSA conference papers ersa03p68, European Regional Science Association.
  • Handle: RePEc:wiw:wiwrsa:ersa03p68
    as

    Download full text from publisher

    File URL: http://www-sre.wu.ac.at/ersa/ersaconfs/ersa03/cdrom/papers/68.pdf
    Download Restriction: no

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:wiw:wiwrsa:ersa03p68. 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: (Gunther Maier). General contact details of provider: http://www.ersa.org .

    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.

    We have no references for this item. You can help adding them by using 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.