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The Cost of Using Private Finance for Roads in Spain and the UK
Author(s) -
Acerete Jose Basilio,
Shaoul Jean,
Stafford Anne,
Stapleton Pam
Publication year - 2010
Publication title -
australian journal of public administration
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.524
H-Index - 41
eISSN - 1467-8500
pISSN - 0313-6647
DOI - 10.1111/j.1467-8500.2009.00654.x
Subject(s) - context (archaeology) , variety (cybernetics) , private finance initiative , finance , downside risk , pessimism , business , state (computer science) , private enterprise , private sector , relation (database) , economics , public economics , economic growth , portfolio , philosophy , epistemology , algorithm , artificial intelligence , computer science , paleontology , database , biology
Within the context of the growing worldwide tendency to fund road construction, operation and maintenance through a variety of private financing arrangements, this article explores the implications of recent road developments in Spain and England. Among other things, it shows that the use of private financing mechanisms is problematic in relation to the cost of risk transfer, and that the lack of information due to commercial sensitivity acts as a deterrent to objective assessment. The pessimistic conclusion is that, in these arrangements, downside risks are borne by the state, and the authors argue that using private financing for roads is another case of ‘privatising the benefits and nationalising the costs’.