The Effects of Public-Private Partnership on Innovation and Project Performance

Abstract

There are many sound rationales for promoting Public–private partnerships (PPPs), which led to significant global adoption of the model. However, the outcomes achieved by many PPPs fell short of expectations in many countries, resulting in their decline. Humankind faces grand challenges of climate change, provision of food, water and energy, as well as the need to build more resilient habitation as climate changes. PPPs have been promoted by the United Nations and governments around world as a key strategy for meeting these challenges. Despite their promotion in practice, PPP research and theory development has lagged adoption and political debate. Research is much needed in the areas of understanding what benefits PPPs can realistically deliver and theory that guides PPP practice is required. PPPs are complex phenomena, whether looked at from pollical, social, financial, contractual, organizational or technical perspectives; hence, adopting a cross disciplinary approach is necessary to address basic overarching questions: Why do many PPP projects fail to deliver benefits? What are the fundamental issues or key factors that inhibit the benefits of PPP being achieved and how to address them?

This research focuses on two dimensions: PPP project finance as well as project organisation and management. At their centre is the Special Purpose Vehicle (SPV), an independent organization created as the pivotal means for delivering PPP projects. The thesis investigates the effects of embedded elements of PPPs on project delivery and service provision. The three specific research questions were addressed during interactive processes of interviewing, analysing data and reviewing literature, using a Grounded Theory Method (GTM). The research explores the impact of project finance on the ability of SPVs to deliver public infrastructure projects, systematically addressing the relation between PPPs and innovation, and critically examining PPP organizing.