A direct comparison of the performance of public-private partnerships with that of traditional contracting

Bruno Rodrigues,Cesar Zucco

doi:10.1590/0034-761220170313

Abstract

Abstract This paper assesses the city of Belo Horizonte’s experience building school infrastructure through public-private partnerships (PPPs). Between 2009 and 2015, Belo Horizonte built very similar schools using both PPPs and traditional public contracting (TPC). As the choice of mode of contracting was unrelated to our outcomes of interest, the experience constitutes a quasi-experiment that allows for a simple and direct comparison of PPPs to TPC. We examine construction- and operation-phase outcomes measured using administrative data and a survey of school administrators. We find that schools constructed under the PPP contracting model outperformed those built using TPCs in most outcomes.

Highlights

In 2009, the incoming government of Belo Horizonte — one of Brazil’s largest cities1 — prioritized the expansion of preschool enrollment, which called for the construction of a large number of new schools
This article presented a direct comparison of public-private partnerships and traditional public contracting for the construction and operation of preschool infrastructure
It analyzed the case of Belo Horizonte, a large Brazilian city, in which similar schools were built during the same period using both contracting models

Summary

Introduction

In 2009, the incoming government of Belo Horizonte — one of Brazil’s largest cities1 — prioritized the expansion of preschool enrollment, which called for the construction of a large number of new schools. After initially struggling to improve the city’s educational infrastructure using traditional public contracting (TPC), the administration introduced a novel program to build and operate schools using public-private partnerships (PPPs). PPPs have been used for decades at the federal, state and local levels across a range of policy areas as an alternative to TPC. Despite the attention given to the topic in the academic literature, most of which touts the advantages of PPPs relative to TPC, there are still surprisingly few studies that perform a head-to-head comparison of the construction and operational performance of the two models. The dearth of academic work is largely due to a lack of data on TPC projects and to difficulties in setting up a clear comparison between PPP and TPC projects in similar policy areas, carried out during similar periods and locales

Results

Discussion

Conclusion