Political Influences of Stakeholders on Early Termination of Public-Private Partnerships: A Study on China’s Toll Road Projects

Abstract

As a policy innovation for public goods delivery, public-private partnership (PPP) faces great risks in developing countries, and many projects have been terminated before the contract expiry date. This study explores how key stakeholders of the government that is responsible for PPP development, including the upper-tier government, the public, and business partner, can exert political influences through institutional ways over the fate of PPP projects. It argues that political pressures from the upper-tier government and the public, together with political relationship between the government and its business partner, determine whether the government would terminate its PPPs ahead of schedule. Empirically, this study investigates toll road PPP experiences in China. A qualitative comparative analysis (QCA) of 57 toll projects suggests the complexity of causal effect of political factors. In total, the factors of political pressures and political relationship form three pathways to PPP early termination.