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Title: Official tenure, fiscal capacity, and PPP withdrawal of local governments: evidence from China’s PPP project platform
Authors: Wang, Yingying
Song, Wenjuan
Zhang, Bo
Tiong, Robert Lee Kong
Keywords: Engineering::Civil engineering
Issue Date: 2021
Source: Wang, Y., Song, W., Zhang, B. & Tiong, R. L. K. (2021). Official tenure, fiscal capacity, and PPP withdrawal of local governments: evidence from China’s PPP project platform. Sustainability, 13(24), 14012-.
Journal: Sustainability
Abstract: PPP withdrawal policy is helpful to reduce over-investment in PPPs leading to sustainable development. However, little is known about the role of local governments on over-investment in PPPs. Using the PPP Project Platform Data, a unique dataset, this article is able to quantify over-investment in PPPs by coding PPP withdrawal for the first time. This research tests the influencing factors of PPP withdrawal at the municipal level, according to the centralized withdrawal policy in late 2017 as an exogenous treatment. Based on the theory of over-investment to rapid economic growth, this study develops a two-pillar framework under the combination of political man and economic man assumptions to explain the PPP withdrawal of local governments. The results show that both official tenure and fiscal capacity are significant factors. In addition, debt partially mediates the mayor tenure on PPP withdrawal, and the land revenue growth can hinder the negative relationship between mayor tenure and PPP withdrawal. It implies that over-investment in PPPs is strongly influenced by official leaders’ personal promotion incentive and official group members’ collective benefit. Thus, our findings indicate that the centralized withdrawal policy is an effective instrument to prevent over-investment in PPPs. Moreover, a match should be formed between local development planning and investment plans to promote sustainable of PPP investment.
ISSN: 2071-1050
DOI: 10.3390/su132414012
Schools: School of Civil and Environmental Engineering 
Rights: © 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// 4.0/).
Fulltext Permission: open
Fulltext Availability: With Fulltext
Appears in Collections:CEE Journal Articles

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