Public-private partnerships (PPPs) operate at the boundary of the public and private sectors, being neither fully public nor fully private. PPPs are defined in this paper as privately financed infrastructure projects in which a private firm either: (i) sells its services to the government; or...

When governments seek private investment in infrastructure projects, they usually find themselves asked to provide grants, guarantees, or other forms of fiscal support. Often they prefer to provide support in ways that limit immediate cash expenditure but sometimes generate large costs later....

Long-term commitments to make output-based payments for infrastructure can encourage private investors to provide socially valuable services. Making good decisions about such commitments is difficult, however, unless the government understands the fiscal costs and risks of possible commitments....