Abstract
We use an original database of 5000 French local public authorities to explore the impact of organizational choice and performance as measured by consumer prices. In quantifying the impact of the choice of public-private partnerships (PPPs) on performance, we consider the related issue of the determinants of organizational choice. We estimate a switching regressions model to account for the endogeneity of organizational choice, and find that in our sample, (i) the choice by local public authorities to engage in a PPP is not random, and (ii) conditional on the choice of a PPP, consumer prices are significantly higher on average.
Similar content being viewed by others
References
Athias, L. and S. Saussier (2005) ‘Contractual Design of Toll Adjustment Processes In Infrastructure Concession Contracts: What Matters?’, Working Paper ATOM-U. of Paris I Sorbonne.
Bajari P., Tadelis S. (2001) ‘Incentives versus Transaction Costs: a Theory of Procurement Contracts’. RAND Journal of Economics, 32, 387–407
Bennett, J. and E. Iossa (2006) ‘Building and Managing Facilities for Public Services’, Journal of Public Economics, Forthcoming.
Boyco M., Shleifer A., Vishny R. (1996) ‘A Theory of Privatization’. Econ. J., 106, 309–319
Cour des Comptes (1997) La gestion des services publics locaux d’eau et d’assainissement, Rapport Public, Paris, Editions du Journal Officiel.
Cour des Comptes (2003) La gestion des services publics d’eau et d’assainissement, Rapport Public, http://www.ccomptes.fr/Cour-des-comptes/publications/rapports/cdc55.htm
Demsetz H. (1968) ‘Why Regulate Utilities?’. Journal of Law and Economics, 11, 55–66
Desrieux, C. (2005) ‘Revisiting Relational Contracting in Public Private Partnerships : A Comparison of French and American Local Public Services’ Working Paper ATOM-U. of Paris I Sorbonne.
Goldberg V.P. (1976) ‘Regulation and Administered Contracts’. Bell Journal of Economics, 7, 426–448
Guérin-Schneider L., Breuil L., Bonnet Fr. (2003) ‘Dix ans de loi Sapin dans les services d’eau et d’assainissement: évolutions et perspectives du modèle de délégation à la française’. Responsabilité et Environnement, 31, 44–57
Hart O.D. (2003) ‘Incomplete Contract and Public Ownership: Remarks, and an Application to Public–Private Partnerships’. Economic Journal, 113, 69–76
Hart O.D., Shleifer A., Vishny R.W. (1997) ‘The Proper Scope of Government: Theory and Application to Prisons’. Quarterly Journal of Economics, CXII, 1127–1162
Huet F., Saussier S. (2003) ‘The Provision of Public Interest Services through Private Law Contracts’. European Business Organization Law Review, 4, 403–428
Littlechild S.C. (2002) ‘Competitive Bidding for a Long-Term Electricity Distribution Contract’. Review of Network Economics, 1, 1–38
Ménard C., Saussier S. (2002) ‘Contractual Choices and Performances: The Case of Water distribution in France’, in Economics of Contracts: Theories and Applications. Cambridge University Press, pp. 440–463.
Ménard C., Saussier S. (2003) ‘La délégation de service public comme mode organisationnel efficace de la distribution d’eau en France: Théories et évidences empiriques’. Economie Publique, 12, 99–129
Vickers J., Yarrow G. (1991) ‘Economic Perspectives on Privatization’. Journal of Economic Perspectires, 5, 111–132
Vining A.R., Boardman A.E. (1992) ‘Ownership versus Competition: Efficiency in Public Entreprise’. Public Choice, 73, 205–239
Williamson O.E. (1976) ‘Franchise Bidding for Natural Monopolies – In General and with Respect to CATV’. Bell Journal of Economics, 7, 73–104
Williamson O.E. (1999) ‘Public and Private Bureaucracies: A Transaction Cost Economics Perspective’. Journal of Law Economics and Organization, 15, 306–342
Zupan M.A. (1989a) ‘Cable Franchise Renewals : Do Incumbent Firms Behave Opportunistically?’. RAND Journal of Economics, 20, 473–482
Zupan M.A. (1989b) ‘The Efficacy of Franchise Bidding Schemes in the Case of Cable Television: Some Systematic Evidence’. Journal of Law and Economics, 32, 401–456
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Chong, E., Huet, F., Saussier, S. et al. Public-Private Partnerships and Prices: Evidence from Water Distribution in France. Rev Ind Organ 29, 149–169 (2006). https://doi.org/10.1007/s11151-006-9106-8
Published:
Issue Date:
DOI: https://doi.org/10.1007/s11151-006-9106-8