(Re)defining public-private partnerships (PPPs) in the new public governance (NPG) paradigm: an institutional maturity perspective

ABSTRACT

Infrastructure public-private partnerships (PPPs) are dominantly seen as part of an increasingly fragmented and uncertain public management paradigm known as New Public Governance (NPG). However, the effects of institutional maturity on PPP utilization within this domain remain understudied. In order to (re)define PPPs within the NPG paradigm, we develop a PPP institutional maturity model based on three institutional capabilities-legitimacy, trust, and capacity. We then use the U.S. PPP market as a case example to explore how the maturity of PPPs in an institutional setting depends on legitimacy, trust, and capacity in the PPP model.

KEYWORDS:

• New public governance (NPG)
• public-private partnership (PPP)
• institutional maturity
• public management

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. Broken agency involves parties at one phase of the project making decisions in their own interest that impose undue costs on counterparties in subsequent phases of project delivery.

2. PPPs actually impact the intertemporal government budget in much the same way as traditional provision. While the PPP can save the government the initial capital expenditures and investment outlays, the government must relinquish either future user fee revenue (if the PPP project is financed with user fees) or future spending (if the PPP is financed with payments from the government budget) (Geddes 2011).

3. See Iseki et al. (2009) for a detailed assessment of PPP-enabling federal legislation.

4. Within the last year, both Texas (TxDOT) and California (Caltrans) lost their transportation PPP authorization.

5. For a more detailed review of PPP governance mechanisms, see OECD (2012).

Additional information

Notes on contributors

Carter B. Casady

Carter B. Casady is a doctoral candidate in Civil and Environmental Engineering at Stanford University. He is passionate about infrastructure development, procurement, governance, public-private partnerships (PPPs), project finance, and public policy. His current interdisciplinary research examines the impacts of deferred maintenance on public sector buildings. Prior to entering the PhD program, Mr. Casady served as research associate for the Harvard Kennedy School of Government, conducting simplified Benefit-Cost Analyses (BCAs) on U.S. managed lane projects. His past experience also includes work for the Federal Highway Administration (FHWA), President’s Council of Economic Advisors (CEA), and Cornell Program in Infrastructure Policy (CPIP). He holds a B.S. in Policy Analysis & Management (2016) from Cornell University and a M.S. in Civil and Environmental Engineering (2017) from Stanford University.

Kent Eriksson

Kent Eriksson is a Professor at KTH, the Royal Institute of Technology in Stockholm, Sweden. Dr. Eriksson works around the world as a consultant in project management, finance, business development and regulation. He has been a member of the board of directors of the Swedish financial supervisory authority, and of the European Commissions’ financial services user group. Dr. Eriksson currently conducts research on private public partnership infrastructure projects and investor management of risk and uncertainty. He received his PhD from Uppsala University, Sweden.

Raymond E. Levitt

Raymond E. Levitt is the Kumagai Professor of Engineering, Emeritus in Stanford’s Sustainable Design and Construction graduate program and the Founder of the Stanford Global Projects Center. He also served as a Commissioner of California’s Public Infrastructure Advisory Commission and is currently a Member of the National Academy of Construction as well as a Distinguished Member of the American Society of Civil Engineers. Through his research on the financing, governance and sustainability of global building and infrastructure projects, Dr. Levitt has authored numerous publications and co-authored and co-edited several books.

W. Richard Scott

W. Richard Scott (Dick) Scott is Professor Emeritus of Sociology at Stanford University with courtesy appointments in the Graduate School of Business, the Graduate School of Education, and the School of Medicine. He is also a Senior Researcher in the Stanford Global Projects Center and member of the National Academy of Medicine. He is the author or editor of many professional articles and books and was the recipient of the Academy of Management’s Richard D. Irwin Award for Distinguished Contributions to Management as well as the Academy of International Business’ Eminent Scholar of the Year (2015) Award.