PT  - JOURNAL ARTICLE
AU  - Feng Dong
AU  - Nicola Chiara
TI  - Improving Economic Efficiency of Public-Private Partnerships for Infrastructure Development by Contractual Flexibility Analysis in a Highly Uncertain Context
AID  - 10.3905/jsf.2010.2010.1.002
DP  - 2010 Apr 30
TA  - The Journal of Structured Finance
PG  - 87--99
VI  - 16
IP  - 1
4099  - https://pm-research.com/content/16/1/87.short
4100  - https://pm-research.com/content/16/1/87.full
AB  - Public-private partnerships (PPPs), as long-term contractual relationships between the public and private sector, are usually controlled by a rigid contractual structure. This principle can reduce transaction costs but sacrifice opportunities to make PPPs more economically efficient by allocating and addressing future downside risks appropriately and flexibly during a long-term concession, which is full of unpredictable uncertainties that cause the failure of many infrastructure development projects under PPPs procurement. This article aims to present a novel type of proactive uncertainty management, contractual flexibility analysis (CFA), which can improve the economic efficiency of PPPs by incorporating flexibilities into the current way of contract structuring.TOPICS: Volatility measures, downside-only measures