Determinants of public–private partnerships: an empirical analysis of Asia

Abstract

Purpose Despite being a global public–private partnerships (PPPs) leader, the Asian region is characterised by a wide PPP-divide, wherein select countries attract majority of PPP projects, while other countries fail to attract the requisite PPP investments. Against this background, the purpose of this study is to investigate the determinants of PPP projects in Asia. Design/methodology/approach Using quantitative methods on secondary data, this study analyses the macroeconomic determinants of value and number of PPPs in Asia for the period 2010–2019. The methodology relies on panel fixed effects, random effects, two-step system generalised method of moments and negative binomial regression. Findings Results underline the importance of the country’s experience with PPPs, physical infrastructure, financial sector development, market conditions, institutional quality and political stability in attracting PPP projects. Practical implications Identification of the determinants of PPPs will assist private investors in making informed decisions related to the selection of countries for PPP investments, thereby increasing the likelihood of a project’s success. Social implications The results are expected to enable countries to formulate policies aimed at attracting higher PPP investments, thereby propelling economic development and improvement in the quality of life. Originality/value To the best of the authors’ knowledge, this is the first such study that comprehensively analyses the determinants of both value of PPP investments and number of PPP projects for Asian countries.