VALUE FOR MONEY: TO WHAT EXTENT DOES DISCOUNT RATE MATTER?

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Autore principale: Carlos Contreras
Natura: Artículo científico
Lingua:en
Pubblicazione: Universidad de Zaragoza 2014
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author Carlos Contreras
author_facet Carlos Contreras
contents VALUE FOR MONEY: TO WHAT EXTENT DOES DISCOUNT RATE MATTER? Carlos Contreras Economía y Finanzas public discount rate value for money project evaluation private partnership This paper proposes a Value for Money test to assess the appropriateness of using public-private partnerships (PPPs), and performs a numerical analysis to verify to what extent the outcomes are sensitive to the discount rates being used. The test is applied to two projects which differ in the length of the concession contract and the level of capital intensity. The paper finds that the higher the discount rate being used, the larger the advantage of using a PPP as the supply method. This conclusion is more visible in the case of projects with longer concession terms. Moreover, using one single discount rate for very different project profiles seems to be inadequate. 2014 artículo científico 1133-455X https://www.redalyc.org/articulo.oa?id=96932962004 en http://www.redalyc.org/revista.oa?id=969 Revista de Economía Aplicada application/pdf Universidad de Zaragoza Revista de Economía Aplicada (España) Num.66 Vol.XXII
format Artículo científico
id redalyc_96932962004
institution Redalyc
language en
publishDate 2014
publisher Universidad de Zaragoza
spellingShingle VALUE FOR MONEY: TO WHAT EXTENT DOES DISCOUNT RATE MATTER?
Carlos Contreras
Economía y Finanzas
public
discount rate
value for money
project evaluation
private partnership
VALUE FOR MONEY: TO WHAT EXTENT DOES DISCOUNT RATE MATTER? Carlos Contreras Economía y Finanzas public discount rate value for money project evaluation private partnership This paper proposes a Value for Money test to assess the appropriateness of using public-private partnerships (PPPs), and performs a numerical analysis to verify to what extent the outcomes are sensitive to the discount rates being used. The test is applied to two projects which differ in the length of the concession contract and the level of capital intensity. The paper finds that the higher the discount rate being used, the larger the advantage of using a PPP as the supply method. This conclusion is more visible in the case of projects with longer concession terms. Moreover, using one single discount rate for very different project profiles seems to be inadequate. 2014 artículo científico 1133-455X https://www.redalyc.org/articulo.oa?id=96932962004 en http://www.redalyc.org/revista.oa?id=969 Revista de Economía Aplicada application/pdf Universidad de Zaragoza Revista de Economía Aplicada (España) Num.66 Vol.XXII
title VALUE FOR MONEY: TO WHAT EXTENT DOES DISCOUNT RATE MATTER?
topic Economía y Finanzas
public
discount rate
value for money
project evaluation
private partnership
url https://www.redalyc.org/articulo.oa?id=96932962004