Economic Efficiency and Political Capture in Public Service Contracts
Philippe Gagnepain
(1, 2)
,
Marc Ivaldi
(3)
Philippe Gagnepain
- Fonction : Auteur
- PersonId : 909981
- IdHAL : philippe-gagnepain
- ORCID : 0000-0001-9099-2215
Résumé
We consider contracts for public transport services between a public authority and a transport operator. We build a structural endogenous switching model where the contract choice results from the combined effects of the incentivization scheme aimed at monitoring the operator's efficiency and the political agenda followed by the regulator to account for the voice of private interests. Our results support theoretical predictions as they suggest that cost-plus contracts entail a higher cost for society than fixed-price contracts but allow the public authority to leave a rent to a subset of individuals. Accounting for transfers to interest groups in welfare computations reduces the welfare gap between cost-plus and fixed-price regimes.
Domaines
Economies et financesFormat du dépôt | Notice |
---|---|
Type de dépôt | Article dans une revue |
Titre |
en
Economic Efficiency and Political Capture in Public Service Contracts
|
Résumé |
en
We consider contracts for public transport services between a public authority and a transport operator. We build a structural endogenous switching model where the contract choice results from the combined effects of the incentivization scheme aimed at monitoring the operator's efficiency and the political agenda followed by the regulator to account for the voice of private interests. Our results support theoretical predictions as they suggest that cost-plus contracts entail a higher cost for society than fixed-price contracts but allow the public authority to leave a rent to a subset of individuals. Accounting for transfers to interest groups in welfare computations reduces the welfare gap between cost-plus and fixed-price regimes.
|
Auteur(s) |
Philippe Gagnepain
1, 2
, Marc Ivaldi
3
1
PJSE -
Paris Jourdan Sciences Economiques
( 1171428 )
- 48 boulevard Jourdan 75014 Paris
- France
2
PSE -
Paris School of Economics
( 301309 )
- 48 boulevard Jourdan 75014 Paris
- France
3
TSE-R -
Toulouse School of Economics
( 93477 )
- Manufacture de Tabacs, 21 allées de Brienne 31000 Toulouse
- France
|
Langue du document |
Anglais
|
Nom de la revue |
|
Vulgarisation |
Non
|
Comité de lecture |
Oui
|
Audience |
Internationale
|
Date de publication |
2017-03
|
Volume |
65
|
Numéro |
1
|
Page/Identifiant |
1-38
|
Domaine(s) |
|
Mots-clés |
en
Public Service Contracts
|
DOI | 10.1111/joie.12118 |
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