1 option
Renegotiation Without Holdup: Anticipating Spending and Infrastructure Concessions / Eduardo Engel, Ronald Fischer, Alexander Galetovic.
- Format:
- Book
- Author/Creator:
- Engel, Eduardo.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w12399.
- NBER working paper series no. w12399
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Other Title:
- Renegotiation Without Holdup
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2006.
- Summary:
- Infrastructure concessions are frequently renegotiated after investments are sunk, resulting in better contractual terms for the franchise holders. This paper offers a political economy explanation for renegotiations that occur with no apparent holdup. We argue that they are used by political incumbents to anticipate infrastructure spending and thereby increase the probability of winning an upcoming election.
- Contract renegotiations allow administrations to replicate the effects of issuing debt. Yet debt issues are incorporated in the budget, must be approved by Congress and are therefore subject to the opposition's review. By contrast, under current accounting standards the obligations created by renegotiations circumvent the budgetary process in most countries. Hence, renegotiations allow incumbents to spend more without being subject to Congressional oversight.
- Notes:
- Print version record
- July 2006.
The Penn Libraries is committed to describing library materials using current, accurate, and responsible language. If you discover outdated or inaccurate language, please fill out this feedback form to report it and suggest alternative language.