A Study on The Effect of Infrastructure Fund in PPPsThe Case of Macquarie Infrastructure Group
Date Issued
2008
Date
2008
Author(s)
Jiang, Chi-Ruei
Abstract
As its name implies, “infrastructure fund” refers to direct or indirect investment inputs in infrastructure. The development of this type of fund can be traced back to the early 90s. At the time, the scale of the fund was estimated at USD6 billion. Today, the market scale of all infrastructure funds exceeds USD6000billion. Its development is so rapid that infrastructure fund has become the major investment source for large infrastructures. However, researches on this subject are scarce and literatures that probe into fund performance are few. The main reason for this is because information is often so confidential that data collection is often difficult. Therefore, literatures, data, industry-based study reports, market discussions, and case results are taken from wide-ranging data and viewed from different perspectives to construct and describe the industrial conditions and infrastructure fund. The discussions cover: infrastructure fund formation process, history, and industrial performance. The changes and effects of infrastructure are discussed according to public-private partnership and agency theory. Hypotheses related to the effects of infrastructure fund formation are also formed to derive at solutions for problems related to infrastructure fund and public departments/agencies.t is inferred from the study results that it might be possible for infrastructure fund to enhance the efficiency and competitiveness of private departments This hypothesis states that the formation of infrastructure fund may produce various effects on changes in the system. To the private departments, its experience, information, finance, and management competence are advantages that produce certain crowding-out effects. On the contrary, public developments may have to entertain the possibility that private departments’ enhanced efficiency and competitiveness might not lead to better social welfare. Therefore, in view of the infrastructure fund formation trend, public departments ought to confirm the goals with cases done in the past as reference in order to ensure they conform to the rights and responsibilities of both sides and that the goals are successfully pushed through. Ultimately, infrastructure fund will perform its role in promoting infrastructure goal setups.
Subjects
infrastructure fund
agency problem
public private partnership
Type
thesis
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