Public Private Partnerships for Airports, Water Ports, Rail, Buses, and Taxis: A Policy Perspective

Abstract

This chapter describes, analyzes, and provides policy implications on Public Private Partnerships (P3s) in airports, taxicabs, buses, rail, and water ports. It provides the history of P3s, the advantages and disadvantages as reflected in the worldwide case studies analyzed. P3s combine efforts and risk sharing of public and private entities where each provides its comparative advantage. An advantage of P3 is reducing investments in “white elephants” requiring avoidance of availability payments. Currently, governments, mostly for historical reasons, provide services that could be privately provided where users fees are possible with low transaction costs attributed to recent technological innovations. Government could shift most transportation services from a monopolistic provider to a small number of experts that oversee the contracts of P3s in the public interest. Noteworthy, transportation services are interrelated. For example, P3s in rail would increase available resources, improve services to distant airports, thereby decrease current regional airport monopolies, and raise competition among them. Similarly, autonomous vehicles could reduce rail, bus, and taxicab monopolies, leading to greater competition among them and productivity gains.