Economics

Innovating Through PPPs: The Case of Economic Development in Barcelona

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Public-private partnerships (PPPs) are a model of financing public goods. Although PPPs have been around for decades, they have regained interest due to the volatility of the economic context. The object of the PPP is the construction, transformation, maintenance and operational management of work in exchange for its availability, its economic exploitation, or the provision of a service related to the use of the work itself. The institution of the PPP is suggested when the use of private capital and resources can have benefits for the public administration and the end-users of the services. These benefits can be both of an economic nature and materialize in a reduction in the overall costs of building and managing the infrastructure, or attributable to an increase in the efficiency, effectiveness and quality of the services provided. However, in a complex and volatile environment, PPPs are not always easy to manage. Traditionally, PPPs have been associated with large infrastructure projects or service provision. Despite this, there is an underdeveloped and innovative area regarding PPPs. Contexts for which stakeholders have low knowledge are especially prone to more innovative PPPs. Among these contexts, it is specially the case for those where, in addition, the PPP is deployed in the realm of highly complex services. In this document, we outline the theoretical and practical implications of PPPs in the context of low knowledge projects and, particularly, for PPP projects in highly complex scenarios. We do so by relying on the case of Barcelona, analyzing their evolution of PPP projects between 2010 and 2021 in the light of their knowledge and complexity requirements. By doing so, we uncover the evolution of Barcelona?s PPPs towards highly innovative contexts for economic development. Finally, we provide managerial and policy making implications for other contexts aiming at targeting innovative approaches to PPPs.
Bibliographic citation: BERRONE, P., CARRASCO-FARRÉ, C., PLANA, A., RICART, J. E., TRUPIA, G. (2022). Innovating Through PPPs: The Case of Economic Development in Barcelona. IESE.
Date: 01/07/2022
Author(s): Pascual Berrone; Carlos Carrasco-Farré; Alicia Plana; Joan Enric Ricart; Giorgia Trupia
Document type: Study and Monograph
Department: Strategic Management
Sector:
Languages: English