Control, incentives and penalties in the transit contracting process

The last decade of the twentieth century was characterized by financial and budget constraints in almost all government activities. Transportation was no exception, and many countries moved to private operation as a way to reduce their need for operating and capital subsidies, and acquire technical competency to produce higher quality public services. Private participation, however, may require the implementation of a regulatory instrument to ensure the accomplishment of public goals. The most common form of regulation for large transit systems is the use of concession contracts. They govern the relationship between the government and the private provider, converting government's objectives into the economic variables that guide the private firm behavior. This thesis analyzes a variety of issues that should be considered by a government agency studying private involvement in transit operations by bringing together concepts from different fields such as economics, law, political science, negotiation, policy making, engineering, and transportation science. First the entire menu of alternatives for private participation and regulation is presented, and the advantages and disadvantages of contracts as legal instruments are analyzed. Next, a qualitative approach uses a six stages project evolution framework to identify the most relevant variables that can considerably affect the outcome of the concession process and analyzes them in detail. Third, a quantitative approach uses a business model to study the relevance of the incentives and penalties arrangement in the contract and its influence in the service outcome.

Department dc:contributor.department

Massachusetts Institute of Technology. Dept. of Civil and Environmental Engineering.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2004

Author dc:creator

• Raspall Galli, Demian, 1973-

Advisor dc:contributor.advisor

• Frederick P. Salvucci.

• Civil and Environmental Engineering.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/29403

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/29403