Renegotiations and Contract Renewals in Ppps. an Empirical Analysis
Abstract: In this paper we shed some light on the issue of renegotiations. Using an original dataset of 262 expired public-private contracts in the French car park sector, we assess the impact of renegotiations on the contractual relationship. More precisely, we investigate the link between renegotiations and contract renewals. Indeed, if renegotiations led to surplus decrease, then parties would not be prone to contract again together. Our econometric results reveal that some renegotiation types, their frequency and their scope clearly impact on the probability to see a contract renewed as soon as public authorities have discretionary power on the decision to renew a contract with the same private partner. Hence, our results suggest a positive, negative or neutral impact on the contractual surplus depending on the kind of renegotiation and the kind of contract that is considered.