Infrastructures, Public Accounts and Public-Private Partnerships: Evidence from the Italian Local Administrations

Abstract

Public-Private Partnerships (PPPs) have been widely advocated as flexible contractual solutions enabling the public sector to profit fom private firm's innovative solutions for providing additional (possibly by increasing the infrastructure stock) and more valuable public services. Recently, however, practioners and academics alike have cast doubts on a possible opportunistic use of PPPs: instead of an efficient option to fill infrastructure gaps across different social and economic areas, PPPs may be employed as a priviliged way to face periods of fiscal consolidation or those on a thight budget. In order to shed some light on this suspicion, we construct an original dataset containing PPPs' tender notice information, budget results of the Italian municipalities aggregated at provincial level, per capital wealth, indexes of infrastructure stocks and morpho-demographic information on local areas. Our findings highlights i) a feeble linkage between the decision to deploy a PPP and the existence of an infrastructural gap, and ii) a strong relationship between the number of deployed PPP procedures and the local budgetary results.