Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America

Multidimensional auctions are a natural and practical solution when auctioneers pursue more than one objective in their public-private-partnership transactions. However, it is difficult to achieve auction efficiency with multiple award criteria. Us...

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Main Authors:	Estache, Antonio, Guasch, Jose-Luis, Iimi, Atsushi, Trujillo, Lourdes
Format:	Policy Research Working Paper
Language:	English
Published:	World Bank, Washington, DC 2012
Subjects:	ADVERSE SELECTION AIRPORTS AUCTION AUCTION DESIGN AUCTION MECHANISM AUCTION MECHANISMS AUCTIONS BANKRUPTCIES BANKRUPTCY BID BIDDING FOR CONCESSIONS BIDDING PROCESS BIDS BUS BUS INDUSTRY CAPABILITY COMPETITIVE BIDDING COMPETITIVE PROCUREMENT CONCESSION CONTRACTS CONCESSION TRANSACTIONS CONCESSIONAIRES CONTRACT PERIODS COUNTRY DUMMY CREDIBILITY CURRENCY CURRENCY CRISIS DEFICITS DEVELOPING COUNTRIES DEVELOPMENT BANK DIESEL DIVESTITURE DUMMY VARIABLE DUMMY VARIABLES ELECTRICITY ELECTRICITY DISTRIBUTION FINANCIAL CAPACITY FINANCIAL VIABILITY FREIGHT FREIGHT SERVICE FUTURE DEMAND GLOBAL STANDARDS GOOD GOVERNANCE GOVERNANCE INDICATORS GOVERNANCE INDICES GOVERNMENT COMPENSATION GOVERNMENT POLICIES GOVERNMENT POLICY HIGHWAY HIGHWAY CONSTRUCTION HOLDING INFRASTRUCTURE CONCESSION INFRASTRUCTURE CONCESSIONS INFRASTRUCTURE DEVELOPMENT INFRASTRUCTURE OPERATIONS INFRASTRUCTURE SECTOR INSTRUMENT INTERNATIONAL BANK INVESTMENT REQUIREMENTS INVESTMENT VALUE LACK OF TRANSPARENCY LATIN AMERICAN LEASE CONTRACT LENGTH OF ROAD LENGTH OF ROADS LICENSES LIVING STANDARDS LOCOMOTIVE MIDDLE EAST MISSING DATA MOTORWAYS NATIONAL RAILWAY NETWORKS NEW TECHNOLOGY NORTH AFRICA PASSENGER RAIL PASSENGER SERVICES PASSENGER TRAIN POLITICAL CONSIDERATIONS POSITIVE COEFFICIENT POWER PRICE COMPETITION PRIVATE OPERATORS PRIVATE PARTNERSHIP PRIVATE SECTOR PRIVATE SECTOR INVOLVEMENT PRIVATE SECTOR PARTICIPATION PRIVATIZATION PRODUCTIVITY PUBLIC INFRASTRUCTURE PUBLIC PROCUREMENT PUBLIC SECTOR PUBLIC SERVICES PUBLIC-PRIVATE PARTNERSHIP QUALITY OF SERVICES RAIL RAIL FREIGHT RAIL INDUSTRY RAIL PROJECTS RAIL SECTOR RAIL SERVICES RAILROAD RAILROAD CONCESSIONS RAILROADS RAILWAY RAILWAY COMPANIES RAILWAY COMPANY RAILWAY INDUSTRY RAILWAY NETWORK RAILWAY SECTOR RAILWAY SYSTEM RAILWAYS REGULATORY ENVIRONMENT REGULATORY FRAMEWORK RELIABILITY RENEGOTIATION RENEGOTIATIONS RESULT RESULTS RETRENCHMENT RETURN ROAD ROAD CONCESSIONS ROAD PROJECTS ROAD SECTOR ROAD TRAFFIC ROUTES SANITATION SOCIAL COST SPEEDS SUB-SAHARAN AFRICA TARIFF CHANGES TECHNOLOGICAL DEVELOPMENT TECHNOLOGY DEVELOPMENT TELECOMMUNICATIONS TELEVISION TENDERS TOLL TOLL ROAD TRAFFIC TRANSACTION TRANSMISSION TRANSPARENCY TRANSPORT TRANSPORT INFRASTRUCTURE TRANSPORT SECTOR TRANSPORTATION TRUE UNEMPLOYMENT RATE UNEMPLOYMENT RATES URBAN DEVELOPMENT USER UTILITIES WATER DISTRIBUTION WEB WORLD DEVELOPMENT INDICATORS
Online Access:	http://documents.worldbank.org/curated/en/2008/07/9670222/multidimensionality-renegotiation-evidence-transport-sector-public-private-partnership-transactions-latin-america http://hdl.handle.net/10986/6847

id	okr-10986-6847
recordtype	oai_dc
spelling	okr-10986-68472021-04-23T14:02:32Z Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America Estache, Antonio Guasch, Jose-Luis Iimi, Atsushi Trujillo, Lourdes ADVERSE SELECTION AIRPORTS AUCTION AUCTION DESIGN AUCTION MECHANISM AUCTION MECHANISMS AUCTIONS BANKRUPTCIES BANKRUPTCY BID BIDDING FOR CONCESSIONS BIDDING PROCESS BIDS BUS BUS INDUSTRY CAPABILITY COMPETITIVE BIDDING COMPETITIVE PROCUREMENT CONCESSION CONTRACTS CONCESSION TRANSACTIONS CONCESSIONAIRES CONTRACT PERIODS COUNTRY DUMMY CREDIBILITY CURRENCY CURRENCY CRISIS DEFICITS DEVELOPING COUNTRIES DEVELOPMENT BANK DIESEL DIVESTITURE DUMMY VARIABLE DUMMY VARIABLES ELECTRICITY ELECTRICITY DISTRIBUTION FINANCIAL CAPACITY FINANCIAL VIABILITY FREIGHT FREIGHT SERVICE FUTURE DEMAND GLOBAL STANDARDS GOOD GOVERNANCE GOVERNANCE INDICATORS GOVERNANCE INDICES GOVERNMENT COMPENSATION GOVERNMENT POLICIES GOVERNMENT POLICY HIGHWAY HIGHWAY CONSTRUCTION HOLDING INFRASTRUCTURE CONCESSION INFRASTRUCTURE CONCESSIONS INFRASTRUCTURE DEVELOPMENT INFRASTRUCTURE OPERATIONS INFRASTRUCTURE SECTOR INSTRUMENT INTERNATIONAL BANK INVESTMENT REQUIREMENTS INVESTMENT VALUE LACK OF TRANSPARENCY LATIN AMERICAN LEASE CONTRACT LENGTH OF ROAD LENGTH OF ROADS LICENSES LIVING STANDARDS LOCOMOTIVE MIDDLE EAST MISSING DATA MOTORWAYS NATIONAL RAILWAY NETWORKS NEW TECHNOLOGY NORTH AFRICA PASSENGER RAIL PASSENGER SERVICES PASSENGER TRAIN POLITICAL CONSIDERATIONS POSITIVE COEFFICIENT POWER PRICE COMPETITION PRIVATE OPERATORS PRIVATE PARTNERSHIP PRIVATE SECTOR PRIVATE SECTOR INVOLVEMENT PRIVATE SECTOR PARTICIPATION PRIVATIZATION PRODUCTIVITY PUBLIC INFRASTRUCTURE PUBLIC PROCUREMENT PUBLIC SECTOR PUBLIC SERVICES PUBLIC-PRIVATE PARTNERSHIP QUALITY OF SERVICES RAIL RAIL FREIGHT RAIL INDUSTRY RAIL PROJECTS RAIL SECTOR RAIL SERVICES RAILROAD RAILROAD CONCESSIONS RAILROADS RAILWAY RAILWAY COMPANIES RAILWAY COMPANY RAILWAY INDUSTRY RAILWAY NETWORK RAILWAY SECTOR RAILWAY SYSTEM RAILWAYS REGULATORY ENVIRONMENT REGULATORY FRAMEWORK RELIABILITY RENEGOTIATION RENEGOTIATIONS RESULT RESULTS RETRENCHMENT RETURN ROAD ROAD CONCESSIONS ROAD PROJECTS ROAD SECTOR ROAD TRAFFIC ROUTES SANITATION SOCIAL COST SPEEDS SUB-SAHARAN AFRICA TARIFF CHANGES TECHNOLOGICAL DEVELOPMENT TECHNOLOGY DEVELOPMENT TELECOMMUNICATIONS TELEVISION TENDERS TOLL TOLL ROAD TRAFFIC TRANSACTION TRANSMISSION TRANSPARENCY TRANSPORT TRANSPORT INFRASTRUCTURE TRANSPORT SECTOR TRANSPORTATION TRUE UNEMPLOYMENT RATE UNEMPLOYMENT RATES URBAN DEVELOPMENT USER UTILITIES WATER DISTRIBUTION WEB WORLD DEVELOPMENT INDICATORS Multidimensional auctions are a natural and practical solution when auctioneers pursue more than one objective in their public-private-partnership transactions. However, it is difficult to achieve auction efficiency with multiple award criteria. Using auction data from road and railway concessions in Latin America, the probability of renegotiation this paper estimates by a two-stage least squares technique with a binary selection in the first-stage regression. The findings show that auctioneers tend to adopt the multidimensional format when the need for social considerations, such as alleviation of unemployment, is high. This implies that such political considerations could hinder efficiency and transparency in auctions. The analysis also shows that the renegotiation risk in infrastructure concessions increases when multidimensional auctions are used. Rather, good governance, particularly anti-corruption policies, can mitigate the renegotiation problem. 2012-06-01T14:58:43Z 2012-06-01T14:58:43Z 2008-07 http://documents.worldbank.org/curated/en/2008/07/9670222/multidimensionality-renegotiation-evidence-transport-sector-public-private-partnership-transactions-latin-america http://hdl.handle.net/10986/6847 English Policy Research Working Paper No. 4665 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Latin America & Caribbean
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ADVERSE SELECTION AIRPORTS AUCTION AUCTION DESIGN AUCTION MECHANISM AUCTION MECHANISMS AUCTIONS BANKRUPTCIES BANKRUPTCY BID BIDDING FOR CONCESSIONS BIDDING PROCESS BIDS BUS BUS INDUSTRY CAPABILITY COMPETITIVE BIDDING COMPETITIVE PROCUREMENT CONCESSION CONTRACTS CONCESSION TRANSACTIONS CONCESSIONAIRES CONTRACT PERIODS COUNTRY DUMMY CREDIBILITY CURRENCY CURRENCY CRISIS DEFICITS DEVELOPING COUNTRIES DEVELOPMENT BANK DIESEL DIVESTITURE DUMMY VARIABLE DUMMY VARIABLES ELECTRICITY ELECTRICITY DISTRIBUTION FINANCIAL CAPACITY FINANCIAL VIABILITY FREIGHT FREIGHT SERVICE FUTURE DEMAND GLOBAL STANDARDS GOOD GOVERNANCE GOVERNANCE INDICATORS GOVERNANCE INDICES GOVERNMENT COMPENSATION GOVERNMENT POLICIES GOVERNMENT POLICY HIGHWAY HIGHWAY CONSTRUCTION HOLDING INFRASTRUCTURE CONCESSION INFRASTRUCTURE CONCESSIONS INFRASTRUCTURE DEVELOPMENT INFRASTRUCTURE OPERATIONS INFRASTRUCTURE SECTOR INSTRUMENT INTERNATIONAL BANK INVESTMENT REQUIREMENTS INVESTMENT VALUE LACK OF TRANSPARENCY LATIN AMERICAN LEASE CONTRACT LENGTH OF ROAD LENGTH OF ROADS LICENSES LIVING STANDARDS LOCOMOTIVE MIDDLE EAST MISSING DATA MOTORWAYS NATIONAL RAILWAY NETWORKS NEW TECHNOLOGY NORTH AFRICA PASSENGER RAIL PASSENGER SERVICES PASSENGER TRAIN POLITICAL CONSIDERATIONS POSITIVE COEFFICIENT POWER PRICE COMPETITION PRIVATE OPERATORS PRIVATE PARTNERSHIP PRIVATE SECTOR PRIVATE SECTOR INVOLVEMENT PRIVATE SECTOR PARTICIPATION PRIVATIZATION PRODUCTIVITY PUBLIC INFRASTRUCTURE PUBLIC PROCUREMENT PUBLIC SECTOR PUBLIC SERVICES PUBLIC-PRIVATE PARTNERSHIP QUALITY OF SERVICES RAIL RAIL FREIGHT RAIL INDUSTRY RAIL PROJECTS RAIL SECTOR RAIL SERVICES RAILROAD RAILROAD CONCESSIONS RAILROADS RAILWAY RAILWAY COMPANIES RAILWAY COMPANY RAILWAY INDUSTRY RAILWAY NETWORK RAILWAY SECTOR RAILWAY SYSTEM RAILWAYS REGULATORY ENVIRONMENT REGULATORY FRAMEWORK RELIABILITY RENEGOTIATION RENEGOTIATIONS RESULT RESULTS RETRENCHMENT RETURN ROAD ROAD CONCESSIONS ROAD PROJECTS ROAD SECTOR ROAD TRAFFIC ROUTES SANITATION SOCIAL COST SPEEDS SUB-SAHARAN AFRICA TARIFF CHANGES TECHNOLOGICAL DEVELOPMENT TECHNOLOGY DEVELOPMENT TELECOMMUNICATIONS TELEVISION TENDERS TOLL TOLL ROAD TRAFFIC TRANSACTION TRANSMISSION TRANSPARENCY TRANSPORT TRANSPORT INFRASTRUCTURE TRANSPORT SECTOR TRANSPORTATION TRUE UNEMPLOYMENT RATE UNEMPLOYMENT RATES URBAN DEVELOPMENT USER UTILITIES WATER DISTRIBUTION WEB WORLD DEVELOPMENT INDICATORS
spellingShingle	ADVERSE SELECTION AIRPORTS AUCTION AUCTION DESIGN AUCTION MECHANISM AUCTION MECHANISMS AUCTIONS BANKRUPTCIES BANKRUPTCY BID BIDDING FOR CONCESSIONS BIDDING PROCESS BIDS BUS BUS INDUSTRY CAPABILITY COMPETITIVE BIDDING COMPETITIVE PROCUREMENT CONCESSION CONTRACTS CONCESSION TRANSACTIONS CONCESSIONAIRES CONTRACT PERIODS COUNTRY DUMMY CREDIBILITY CURRENCY CURRENCY CRISIS DEFICITS DEVELOPING COUNTRIES DEVELOPMENT BANK DIESEL DIVESTITURE DUMMY VARIABLE DUMMY VARIABLES ELECTRICITY ELECTRICITY DISTRIBUTION FINANCIAL CAPACITY FINANCIAL VIABILITY FREIGHT FREIGHT SERVICE FUTURE DEMAND GLOBAL STANDARDS GOOD GOVERNANCE GOVERNANCE INDICATORS GOVERNANCE INDICES GOVERNMENT COMPENSATION GOVERNMENT POLICIES GOVERNMENT POLICY HIGHWAY HIGHWAY CONSTRUCTION HOLDING INFRASTRUCTURE CONCESSION INFRASTRUCTURE CONCESSIONS INFRASTRUCTURE DEVELOPMENT INFRASTRUCTURE OPERATIONS INFRASTRUCTURE SECTOR INSTRUMENT INTERNATIONAL BANK INVESTMENT REQUIREMENTS INVESTMENT VALUE LACK OF TRANSPARENCY LATIN AMERICAN LEASE CONTRACT LENGTH OF ROAD LENGTH OF ROADS LICENSES LIVING STANDARDS LOCOMOTIVE MIDDLE EAST MISSING DATA MOTORWAYS NATIONAL RAILWAY NETWORKS NEW TECHNOLOGY NORTH AFRICA PASSENGER RAIL PASSENGER SERVICES PASSENGER TRAIN POLITICAL CONSIDERATIONS POSITIVE COEFFICIENT POWER PRICE COMPETITION PRIVATE OPERATORS PRIVATE PARTNERSHIP PRIVATE SECTOR PRIVATE SECTOR INVOLVEMENT PRIVATE SECTOR PARTICIPATION PRIVATIZATION PRODUCTIVITY PUBLIC INFRASTRUCTURE PUBLIC PROCUREMENT PUBLIC SECTOR PUBLIC SERVICES PUBLIC-PRIVATE PARTNERSHIP QUALITY OF SERVICES RAIL RAIL FREIGHT RAIL INDUSTRY RAIL PROJECTS RAIL SECTOR RAIL SERVICES RAILROAD RAILROAD CONCESSIONS RAILROADS RAILWAY RAILWAY COMPANIES RAILWAY COMPANY RAILWAY INDUSTRY RAILWAY NETWORK RAILWAY SECTOR RAILWAY SYSTEM RAILWAYS REGULATORY ENVIRONMENT REGULATORY FRAMEWORK RELIABILITY RENEGOTIATION RENEGOTIATIONS RESULT RESULTS RETRENCHMENT RETURN ROAD ROAD CONCESSIONS ROAD PROJECTS ROAD SECTOR ROAD TRAFFIC ROUTES SANITATION SOCIAL COST SPEEDS SUB-SAHARAN AFRICA TARIFF CHANGES TECHNOLOGICAL DEVELOPMENT TECHNOLOGY DEVELOPMENT TELECOMMUNICATIONS TELEVISION TENDERS TOLL TOLL ROAD TRAFFIC TRANSACTION TRANSMISSION TRANSPARENCY TRANSPORT TRANSPORT INFRASTRUCTURE TRANSPORT SECTOR TRANSPORTATION TRUE UNEMPLOYMENT RATE UNEMPLOYMENT RATES URBAN DEVELOPMENT USER UTILITIES WATER DISTRIBUTION WEB WORLD DEVELOPMENT INDICATORS Estache, Antonio Guasch, Jose-Luis Iimi, Atsushi Trujillo, Lourdes Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America
geographic_facet	Latin America & Caribbean
relation	Policy Research Working Paper No. 4665
description	Multidimensional auctions are a natural and practical solution when auctioneers pursue more than one objective in their public-private-partnership transactions. However, it is difficult to achieve auction efficiency with multiple award criteria. Using auction data from road and railway concessions in Latin America, the probability of renegotiation this paper estimates by a two-stage least squares technique with a binary selection in the first-stage regression. The findings show that auctioneers tend to adopt the multidimensional format when the need for social considerations, such as alleviation of unemployment, is high. This implies that such political considerations could hinder efficiency and transparency in auctions. The analysis also shows that the renegotiation risk in infrastructure concessions increases when multidimensional auctions are used. Rather, good governance, particularly anti-corruption policies, can mitigate the renegotiation problem.
format	Publications & Research :: Policy Research Working Paper
author	Estache, Antonio Guasch, Jose-Luis Iimi, Atsushi Trujillo, Lourdes
author_facet	Estache, Antonio Guasch, Jose-Luis Iimi, Atsushi Trujillo, Lourdes
author_sort	Estache, Antonio
title	Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America
title_short	Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America
title_full	Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America
title_fullStr	Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America
title_full_unstemmed	Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America
title_sort	multidimensionality and renegotiation : evidence from transport-sector public-private-partnership transactions in latin america
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2008/07/9670222/multidimensionality-renegotiation-evidence-transport-sector-public-private-partnership-transactions-latin-america http://hdl.handle.net/10986/6847
_version_	1764400967213645824

Multidimensionality and Renegotiation : Evidence from Transport-Sector Public-Private-Partnership Transactions in Latin America

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