Managing partner opportunism in public–private partnerships: the dynamics of governance adaptation

ABSTRACT

Controlling partner opportunism in public–private partnership (PPP) is still controversial despite its extensive adoption. We demonstrate that partner opportunism gets controlled by the extent to which deployed governance mechanisms are aligned with the governance needs of the transaction. As unique constraint, the institutional voids limit this alignment. If not aligned with governance needs, governance adaptation cycle continues, resulting in extensive or minimally acceptable partner opportunism. The organizations tolerate opportunism as long as they derive some economic value. In the context of institutional voids, the risk of exploitation of incomplete contracts is high but if governed effectively PPPs could still deliver value.

KEYWORDS:

• Public–private partnership
• governance adaptation
• partner opportunism
• emerging economies
• health sector

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No potential conflict of interest was reported by the authors.

Correction Statement

This article has been republished with minor changes. These changes do not impact the academic content of the article.

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Notes on contributors

Dayashankar Maurya

Dayashankar Maurya is Assistant Professor (Healthcare Management) at T.A. Pai Management Institute, Manipal, India. He did his Masters (Public Policy) and PhD from National University of Singapore and Post-Graduate Diploma in Healthcare Management from Indian Institute of Healthcare Management and Research Jaipur. He has published research articles in international journals including social policy and administration. His research interests are in the area of private sector in healthcare, inter-organizational relations, public–private partnerships collaboration, contracting, and health policy.

Amit Kumar Srivastava

Amit Kumar Srivastava is Assistant Professor (Strategy/General Management) at T.A. Pai Management Institute, Manipal, India. He did PhD (Strategic Management) from Indian Institute of Technology, Delhi, India. He has 8 years of teaching and research experience and published research articles/cases in the international journal. His current research interest areas are strategy execution, strategic alliances, international-organizational relations, and emerging markets.