Determinants of Public-Private Partnerships in Infrastructure

39 Pages Posted: 17 May 2006  

Mona Hammami

affiliation not provided to SSRN

Jean-François Ruhashyankiko

International Monetary Fund (IMF); Harvard University

Etienne B. Yehoue

International Monetary Fund (IMF)

Date Written: April 2006

Abstract

This paper presents an empirical analysis of the cross-country and cross-industry determinants of public-private partnership (PPP) arrangements. We find that PPPs tend to be more common in countries where governments suffer from heavy debt burdens and where aggregate demand and market size are large. Our findings also suggest that macroeconomic stability is essential for PPPs. We provide evidence on the importance of institutional quality, where less corruption and effective rule of law are associated with more PPP projects. PPPs are also more prevalent in countries with previous PPP experiences. At the industry level, we find that PPP determinants vary across industries depending on the nature of public infrastructure, capital intensity, and technology required. We also find that private participation in PPP projects depends on the expected marketability, the technology required, and the degree of 'impurity' of the goods or services.

Keywords: Public-Private Partnerships, Infrastructures, Capital Budgeting, Investment Policy

JEL Classification: H49, H54, G31, G38

Suggested Citation

Hammami, Mona and Ruhashyankiko, Jean-François and Yehoue, Etienne B., Determinants of Public-Private Partnerships in Infrastructure (April 2006). IMF Working Paper, Vol. , pp. 1-39, 2006. Available at SSRN: https://ssrn.com/abstract=902765

Mona Hammami (Contact Author)

affiliation not provided to SSRN

No Address Available

Jean-Francois Ruhashyankiko

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

Harvard University ( email )

1875 Cambridge Street
Cambridge, MA 02138
United States

Etienne Baba Yehoue

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

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