The determinants of contractual choice for private involvement in infrastructure projects

Abstract

Numerous studies have examined the determinants of private participation in infrastructure projects. We depart from this simple public/private dichotomy by empirically examining a rich set of contractual arrangements. Infrastructure characteristics, particularly those that reflect ‘stand alone’ versus network characteristics, are key factors influencing the extent of private participation. Fiscal variables as well as basic controls, such as population and locality of government, increase the degree of private participation. A greater tax burden reduces private participation.

Keywords:

• Contracting
• government
• infrastructure
• privatization
• risk transfer

Acknowledgements

This research received financial help from the Spanish government under project ECO2012-38004, and the Catalan government under project SGR2009-1066. Germà Bel also acknowledges support from ICREA-Academia. We are thankful for very useful research assistance from Anastasiya Yarygina.