Multinational Corporations and Service Provision in Sub‐Saharan Africa: Legitimacy and Institutionalization Matter

This article considers attempts by multinational corporations to provide services in areas of limited statehood. Under which conditions are such attempts effective? We make two arguments: First, they must be legitimate to be effective. Second, the institutional design of the firms’ service provision programs is an important factor for their effectiveness. We assess these arguments by analyzing multinationals in the South African car industry fighting HIV/AIDS, and international mining firms in South Africa and the Democratic Republic of Congo trying to improve public security. The analysis demonstrates that under conditions of legitimacy and high degrees of institutionalization firm programs effectively contribute to service provision in areas of limited statehood.     

Public–private partnerships and developing‐country agriculture: Evidence from the international agricultural research system

This study examines the role of public–private partnerships (PPPs) in promoting pro‐poor productivity‐enhancing technological innovation in the international agricultural research system. The study examines the extent to which PPPs are being used to overcome market and institutional failures that otherwise inhibit the development and dissemination of technologies targeted specifically to small‐scale, resource‐poor farmers in developing countries. Drawing on a survey of 75 PPP projects in the international system, findings suggest that while PPPs are changing the way the system manages its research agenda, few partnerships lead to joint innovation processes with the private sector. This indicates the need for closer examination of organizational practices, cultures, and incentives in the international agricultural research system. Copyright © 2010 John Wiley & Sons, Ltd.     

Public Values in Public–Private Partnerships

Although public–private partnerships (PPPs) are frequently analyzed and lauded in terms of efficiency, their impact on public values is often neglected. As a result, there is little empirical evidence supporting or rejecting the claim that PPPs have a negative effect on public values. This case study provides valuable insight into the relationship between public values in PPPs and the circumstances affecting the degree to which public values are upheld. Research findings demonstrate that whether public values are at stake in PPPs cannot be answered with a simple yes or no. Rather, public values can be threatened, safeguarded, or even strengthened depending on the project phase and the specific facet of the public value under scrutiny. Insight into which circumstances influence the safeguarding of public values in DBFMO (design–build–finance–maintain–operate) projects unravels the strengths and weaknesses of PPPs in terms of public values, providing public managers with a starting point for optimization.     

Public–Private Partnerships and the Public Accountability Question

Public–private partnerships (PPPs) are growing in popularity as a governing model for delivery of public goods and services. PPPs have existed since the Roman Empire, but their expansion into traditional public projects today raises serious questions about public accountability. This article examines public accountability and its application to government and private firms involved in PPPs. An analytical framework is proposed for assessing the extent to which PPPs provide (or will provide) goods and services consistent with public sector goals of effectiveness, efficiency, and equity. Six dimensions—risk, costs and benefits, political and social impacts, expertise, collaboration, and performance measurement—are incorporated into a model that assists public managers in improving partnerships’ public accountability.     

The political cost of public–private partnerships: Theory and evidence from Colombian infrastructure development

Infrastructure public–private partnerships (PPPs) eschew traditional public management to provide distributive goods worldwide. Yet, in Colombia, the context of our study, both the promise of and voters' experience with PPPs hinder incumbent parties in elections when theories of distributive politics expect otherwise. We argue that negative experiences with PPPs introduce a sociotropic turn in individual voting: bad experience crowds out the possibility that promising a new project will improve a voter's own welfare. Studying what are, to our knowledge, all 109 Colombian PPP projects between 1998 and 2014, and over 8,700 individual survey responses, our evidence shows that vote intention for the incumbent executive or his party decreases as experience with more PPPs in respondents' districts increases. Our analysis and results introduce an important agenda for research into the political significance of these legacies of new public management.     

Governing public–private partnerships: A systematic review of case study literature

Governance plays a critical role in determining the success and failure of public–private partnerships (PPPs). We conducted a systematic review of case study literature on PPP governance and developed a governance framework consisting of 21 issues in four groups: institutional, organizational, contractual, and managerial. Then, we investigate the dynamics of governance issues, including the relative importance, interrelationships, and connections with PPP success and failure. Results suggest that PPPs should emphasize cooperation, trust, communication, capability, risk allocation and sharing, competition, and transparency in their governance. We also found that the governance practice of emphasizing dominant and direct factors and ignoring recessive and indirect ones has hindered PPPs’ success.     

Dysfunctional state institutions,trust, and governance in areas of limited statehood

Areas of limited statehood where the state is absent or dysfunctional are rarely ungoverned or ungovernable spaces. The provision of rules and regulations, as well as of public goods and services – governance – does not necessarily depend on the existence of functioning state institutions. How can this be explained? To begin with, we identify functional equivalents to state institutions that fail to govern hierarchically. Moreover, we focus on informal institutions based on trust that are endogenous to areas of limited statehood. Personalized trust among community members enables actors to overcome collective action problems and enhances the legitimacy of governance actors. The main challenge in areas of limited statehood, which are often characterized by social heterogeneity and deep social and cultural cleavages (particularly in post‐conflict societies) is to move to generalized trust beyond the local level and to “imagined communities among strangers,” despite dysfunctional state institutions. We propose two mechanisms: First, the more group‐based identities are constructed in inclusive ways and the more group identities are cross‐cutting and overlapping, the more they lead to and maintain generalized trust. Second, experiences with fair and impartial institutions and governance practices – irrespective of whether state or non‐state – also lead to generalized trust beyond the local level and allow for the upscaling of governance.     

Government Support Programs and Private Investments in PPP Markets

ABSTRACT:

Public-private partnerships (PPPs) have become an important tool for investing in and developing public infrastructure and services. However, many developing countries have failed to attract sufficient private investment from the PPP market. This article uses data from 4,484 PPP projects across 130 developing countries to investigate if and how distinct types of government support can attract more private investment. Results showed that capital, revenue, and in-kind subsidies directly provided from governments attract more private capital, while indirect supports through government guarantee policies do not. The institutional quality of a country enhances the positive relationship between direct government support and private PPP investments. Further, risk allocation plays a mediating role between government supports and private investment.     

External Actors,State‐Building,and Service Provision in Areas of Limited Statehood: Introduction

This article introduces the themes and arguments of the special issue. While virtually all polities enjoy uncontested international legal sovereignty, there are wide variations in statehood, that is, the monopoly over the means of violence and the ability of the state to make and implement policies. Areas of limited statehood are not, however, ungoverned spaces where anarchy and chaos prevail. The provision of collective goods and services is possible even under extremely adverse conditions of fragile or failed statehood. We specify the conditions under which external efforts at state‐building and service provision by state and nonstate actors can achieve their goals. We focus on the extent to which external actors enhance the capacity (statehood) of authority structures in weak states, or directly contribute to the provision of collective goods and services, such as public health, clean environment, social security, and infrastructure. We argue that three factors determine success: legitimacy, task complexity, and institutionalization, including the provision of adequate resources.     

Unpacking the Path‐Dependent Process of Institutional Change for PPPs

In the recent past, several countries and states have begun to use Public‐Private‐Partnerships (PPPs) for infrastructure development and have attempted to create institutional environments that enable PPPs. Providing an enabling environment for PPPs entails a combination of institutional creation and changing existing institutions relating to project procurement. This paper attempts to understand how path‐dependant institutional change takes place in the context of PPPs and their enabling environments, and why different institutional environments evolve differently, using two cases: the implementation of PPPs in the road sector in the Netherlands and in the Indian state of Tamil Nadu. We identify two factors that can be used as predictors of the direction of institutional change: a long‐term orientation towards institutional change and a willingness to learn and modify transitional institutions. Where these factors exist, and thereby provide a goodness of fit, institutional change is likely to occur.     

Governance without a state: Can it work?

In this article we explore how much state is necessary to make governance work. We begin by clarifying concepts of governance and the “shadow of hierarchy” and we follow this clarification with a brief overview of empirical findings on governance research in developed countries. We then discuss the dilemmas for governance in areas of limited statehood, where political institutions are too weak to hierarchically adopt and enforce collectively binding rules. While prospects for effective policymaking appear to be rather bleak in these areas, we argue that governance research has consistently overlooked the existence of functional equivalents to the shadow of hierarchy. We assert that governance with(out) government can work even in the absence of a strong shadow of hierarchy, we identify functional equivalents to the shadow of hierarchy, and we discuss to what extent they can help overcome issues of legitimacy and effectiveness in areas of limited statehood.     

Business Value in Public-Private Partnerships: The Positive Impact of Trust and Task-Relevant Competencies on Business Outcomes in PPPs

ABSTRACT

Governments and businesses enter public-private partnerships (PPPs) to achieve better outcomes, but successful partnerships are not easily accomplished. Because businesses’ expectations about PPP outcomes affect how and whether they participate as partners, managing PPPs effectively requires knowing not just what governments lose or gain, but also the value businesses receive. This article demonstrates how structural, collaborative, and participant factors associated with both public and private partners affect business value in PPPs. Based on a mixed-methods approach, this study tests four hypotheses on how PPPs influence value creation for businesses. The findings show that PPP experience, trust, and size have significant effects on business value. However, they only increase certain types of value, depending on the presence and performance of other factors. Moreover, the results show that businesses gain more intangible values, such as network development and knowledge, than revenue.     

The risky business of public–private partnerships

Public–private partnerships (PPPs) are now a common strand of third way government policy, with better efficiency promised from the private funding of public infrastructure through the transfer of risks to private parties. This paper aims to investigate, on an empirical basis, the realities of risk transfers in PPPs and compare this experience against both the rhetoric of project proponents and the formal contract conditions. The paper outlines some conceptual frameworks underpinning PPPs and establishes the notions of risk shifting and risk sharing. The range of typical risks encountered in infrastructure projects is specially considered, and differences to traditional project delivery arrangements are articulated. Some empirical experience on the transfer of risks under PPPs is then outlined through a case study. This analysis shows the extent to which risks were shifted to the private parties as planned, or whether risks remained with government. It is argued that while commercial risks were largely well managed, governance risks were not. It is critical to understand better the nature of risk transfers in PPPs in view of the large financial implications of these deals along with long contract terms.     

Assessing Organizational Performance: Exploring Differences Between Internal and External Measures

ABSTRACT

Differences in judgments of public service performance across stakeholder groups have often been noted, but have rarely been tested. We measure the extent of these differences between and within internal and external stakeholders. The evidence shows that internal groups usually overestimate the performance of their organizations. We then develop and test a model of inter-organizational variations in the extent of this overestimation. The statistical results show that performance overestimation is more likely in small organizations with geographically dispersed clients, and in organizations that adopt fashionable management practices that are associated with higher institutional legitimacy.     

A Contingent Approach to the Organization and Management of Public–Private Partnerships: An Empirical Study of English Health Care

Public–private partnerships (PPPs) have become a prominent feature of contemporary public policy. Although research shows variation in the contractual configuration of partnerships, there is little evidence of how these shape service and workforce organization. Through comparative ethnographic research on two PPP health care providers in the English National Health Service, this article develops the idea that PPPs exhibit “tight” and “loose” arrangements that relate to “downstream” service and workforce management. It induces four empirically grounded mediating factors to describe this relationship. The first relates to the “dependence” between partners in terms of financing, strategy, and resource sharing; the second to the “strategic orientation” of leaders; the third to the composition of the “professional workforce”; and the fourth to the “management approach” to service and workforce organization. The article contributes to the research literature by exploring the contingencies in how PPPs are operationalized on the ground.     

Getting the fundamentals wrong: woes of public–private partnerships in solid waste collection in three Ghanaian cities

Until over a decade ago, concerted efforts at involving private agents to deliver solid waste collection services did not feature in local government's (LG's) policies and practices in Ghana. The LGs had over the years directly delivered the services with their labour, materials and equipment. The purpose of entering into partnerships with private contractors was to improve service delivery. This comes at a time when the private sector is generally viewed as more efficient and effective than the public sector. There is abundant literature on potential benefits of private sector participation in public service delivery; yet, figures of efficiency gains are often accepted without challenge. More advantages but fewer disadvantages are cited and anecdotal evidence is used only to illustrate successful applications of the concept of public–private partnerships (PPPs). Using research data from three cities (Accra, Kumasi and Tema) in Ghana, this article exposes the contrast between policy expectations and outcomes of PPPs. The article argues that simply turning over public service delivery to private agents without ensuring that the fundamentals that make them successful are put in place leads to a worse situation than portrayed in literature about the benefit of PPPs. Copyright © 2004 John Wiley & Sons, Ltd.     

DIFFERING OPINIONS DO NOT SPOIL FRIENDSHIPS: MANAGING PUBLIC–PRIVATE PARTNERSHIP (PPP) INFRASTRUCTURE PROJECTS IN JORDAN

This research investigates the approaches, strategies and challenges facing the management of the implementation phase of public–private partnership (PPP) projects in Jordan. Jordan is a newer but common user of PPPs in the Middle Eastern region, where PPPs not only are of economic strategic importance but also entail significant investment risk given resource scarcity. This research involves semi‐structured interviews with senior managers representing different partnering organisations in two case study organisations in Jordan. The research finds that, despite the management difficulties confronting PPP managers, strategies adopted by them limit the impact of these challenges. The research makes an important theoretical contribution in providing a detailed analysis of effective PPP management approaches in response to difficulties at the implementation phase, which had not been systematically explored in extant PPP research, and broadens PPP research to the Jordanian context. Moreover, the research contributes greater understanding of how partnerships should be effectively managed. Copyright © 2013 John Wiley & Sons, Ltd.     

The Rise of Public–Private Partnerships in China: An Effective Financing Approach for Infrastructure Investment?

The rise of public‐private partnerships (PPPs) in China has spurred heated debates about their purpose and effectiveness. This article traces the fluctuation of China's PPPs over several decades and finds that PPPs have played a supplementary role in China's infrastructure investment, as a response to the pressures of fiscal shortfalls and government debts. The resurgence of PPPs in recent years aims to bridge the infrastructure gap and alleviate ballooning local debts. These expectations, however, are hard to realize. China's PPPs mainly involve state‐owned enterprises and place increasing financial burdens on the government. The central government has taken measures to attract private sector investment to mitigate the financial risk, but the prospects for PPPs remain unclear.     

State‐Building and the European Union's Fight against Corruption in the Southern Caucasus: Why Legitimacy Matters

This article asks under which conditions the state‐building efforts of external actors in areas of limited statehood are likely to be effective. We argue that the legitimacy of the specific norms promoted by external actors among local actors is crucial for their success in strengthening state capacities. International efforts need to resonate with prevalent social norms. To substantiate this argument, we focus on the European Union's (EU) anticorruption programs and their implementation in one of the most corrupt regions in the world, the Southern Caucasus. We show that legitimacy can explain why the EU's fight against corruption helped reduce corruption in Georgia but not in Armenia. In both countries, political elites could selectively use anticorruption programs as an instrument against political opponents, using enhanced state capacities to stabilize the incumbent regime. Only in Georgia, however, was the fight against corruption facilitated by sustained domestic mobilization for anticorruption policies that added pressure on political elites “from below.”     

When new public management fails: Infrastructure public–private partnerships and political constraints in developing and transitional economies

Amidst calls for more scrutiny of the failure of infrastructure public–private partnerships (PPPs), uncertainty about how we can measure failure remains, and little systematic evidence illuminates its likelihood. Our mixed‐methods design explores the notion of failure and identifies the conditions under which it happens. The first phase of our research employs documentary analysis and semistructured expert interviews, and identifies project cancellation as capturing the most severe occurrences of failure. A second phase statistically analyzes a unique World Bank data set capturing the provisions of over 4,000 infrastructure PPPs launched between 1990 and 2015 in 89 countries. We find robust evidence supporting the theoretical claim that PPPs are less likely to be canceled in countries with more veto points among their political institutions to restrain politicians from intervening in policy implementation. Cancellation is a rare, but valid indicator of failure, and the importance of veto players clarifies how political risk operates in this context.