The transportation infrastructure privatization is an essential solution to the public fund's shortage of transportation investments. In the privatization practices, the private firms build, operate, and own the transportation infrastructure under a limited term. Due to the private sector's involvement, the efficiency of the transportation service is determined not only by the government's management but also by the strategic moves from private firms. In this dissertation, we analyze and improve the public-private partnership on the transportation infrastructure project considering the strategic interactions between the public sector and the private sector and among private firms themselves. In particular, we address two issues: The first part of the dissertation aims to optimize the concessionaire selection and toll and capacity decision-making for the single road franchise under the cost information asymmetry. We systematically examine and analyze the existing contract methods under the general mechanism design framework. From the examination, we find out that the most commonly used contracting approaches, the predetermined toll-capacity auction, and the competitive auctions, fail to limit the information rent and yield sub-optimal welfare for the public. To address this, we derive the optimal direct mechanism and its budget-balanced version as the theoretical benchmark. In addition, we study the implementation of these optimal mechanisms and invent a demand-based mechanism, which significantly improves the franchising mechanisms' practicality. The second part of the dissertation analyzes the toll and capacity decisions of a single origin-destination private road network from the perspective of the government and multiple private firms. We extend the Pareto Efficiency analysis appearing in the literature for the single road case to the case with multiple roads owned by multiple firms. We also consider an oligopolistic market, where, (possibly) following bilateral negotiations with a government, self-interested, private operators set tolls and capacities independently. Characterization of the toll/capacity decisions from the bilateral negotiations suggests that the Pareto efficient decisions between the government and each firm are not sufficiently Pareto efficient in terms of the aggregate benefits of the whole network. We further analyze the situations and conditions for such Pareto inefficiency and provide Kaldor-Hicks improvements on the existing bilateral negotiation framework.

Creator

• Shu, Hang

DOI

• https://doi.org/10.21985/n2-5fab-9662

Subject

• Transportation
• Civil engineering

Language

• en

Alternate Identifier

• etdadmin_upload_764914
• http://dissertations.umi.com/northwestern:15283

Keyword

• Tolling and capacity decision
• Pareto efficiency analysis
• Mechanism design
• Transportation infrastructure
• Network analysis
• Public-private partnership

Date created

• 2020-01-01

Resource type

• Dissertation

Rights statement

• In Copyright