The Evolution and Institutionalisation of Business–Government Relations: Public–Private Partnerships in Khon Kaen, Thailand

Abstract

How does the nature of business–government relations shape the capacity of local governments to accomplish their development objectives? How do different patterns of business–government interaction affect the quantity and quality of public services and the ability of citizens to hold policymakers accountable for their performance? This article attempts to answer these questions in the context of one municipality in Thailand, Khon Kaen City. We argue that the political economy of business–government relationships in Khon Kaen can be divided into three eras, each defined by a different model of business–government interaction: the government-led model, the contracting model, and the public–private partnership model. We describe how the character of business–government relationships has changed across these different models, focusing on three dimensions: (1) the degree to which ties are formalised or institutionalised, (2) the extent to which local businesses coordinate, cooperate, or collude amongst themselves, and (3) the distribution of power between the local government and businesses. We also analyse the drivers behind the shift from one model to another and consider the implications of each for local development and service provision, patterns of rent-seeking, and levels of accountability and participation.