Infrastructure in a Market Economy helps senior decision-makers address critical questions about public-private partnerships in infrastructure. The program brings together senior-level officials from the public, private, and nonprofit sectors to examine lessons learned and best practices from public-private infrastructure development projects around the world. The program addresses such questions as:
- Why have some types of partnerships succeeded where others have failed?
- What partnership models are best suited to what political and economic circumstances?
- How can governments develop and implement reforms to make them politically and economically sustainable over time?
- What are the opportunities and limitations involved in using private capital markets to finance infrastructure?
- When is regulation of tariffs necessary and when can governments achieve effective outcomes using market forces?
- If governments regulate, what mix of contractual and discretionary regulatory mechanisms should be used?
Rethinking Public-Private Partnerships
As governments around the world struggle to provide their citizens with essential infrastructure, they must also determine the most effective roles for the public and private sectors in infrastructure service provision. In recent decades, some countries moved away from state-owned and operated facilities and services in favor of private sector solutions, a strategy that has often attracted investment and improved the efficiency and quality of services. However, a series of well-publicized disasters – the Brazilian electricity crisis of 2001-2002, the bankruptcy of Britain's private railway company in 2001, power contract disputes in Indonesia and Pakistan, and the violent protests against water privatization in Bolivia, among others – have fueled concerns that privatization may have gone too fast or too far. There is renewed interest in developing public-private partnership models that can successfully combine the relative strengths of both sectors.
The course focuses on physical infrastructure, transportation, and utility services. Education, health care, and similar services are not directly considered.
Jose Gomez-Ibanez, faculty in the Infrastructure in a Market Economy program, discusses the private sector role in public infrastructure at the Manhattan Institute. Click on the link below to view: