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Key words: Private sector participation, Data Envelopment Analysis, Efficiency, Public Infrastructure, Highways
JEL codes: H41, H54, L32, L33, O18a
ABSTRACT
Over the past 30 years private sector participation in infrastructure projects has become a trend and a way of delivering public services. It may involve financing, design, construction, operation and/or maintenance of infrastructure - which is traditionally procured and provided by the public sector - such as transport infrastructure (roads, airports), social infrastructure (schools, hospitals), government offices, etc. It is due to this fact that many decision makers in the public sector (ministers, mayors, etc.) are looking to answer the question: "Does involvement of the private capital add value for taxpayers?"
The main objective of this paper is the measuring and evaluation of the efficiency of the private sector participation using Data Envelopment Analysis in the case of mutually comparable decision making units (DMU-Operators), which are involved in public infrastructure projects (highways) in Croatia and selected EU countries.
The results of the analysis of the basic models of DEA, the CCR and the BCC model showed the relevance of the CCR model with the input-oriented model chosen for the analysis. The results of the analysis have identified efficient DMUs and the average sources and levels of inefficiency in each variable, as well as the guidelines for necessary improvements.
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1.INTRODUCTION
Private sector participation in construction and maintenance of public infrastructure projects (in some countries known as public-private partnerships or concession projects) presents a form of cooperation between the private and the public sector in the provision of public infrastructure (Yescombe, 2007). In the dynamic time when public debt and deficit of state budget raised maximum levels of payment capability, many decision makers in the public sector (such as ministers, county prefects, mayors, etc.) are looking for alternative delivery models for public infrastructure provision. These models contain participation of the private sector in the provision of public services. They may involve financing, design, construction, operation and/or maintenance of infrastructure - which is traditionally procured and provided by the public sector - such as transport infrastructure (roads, airports), social infrastructure (schools), government offices, etc. (EC Papers, 2009). The main aim of such cooperation is risk and reward principle. Both the public and...