Public-Private Partnerships: Why the Private Sector Can Pave the Way to Success

In this essay, I will outline how markets are theoretically better equipped than the public sector to solve the road development problem. While there is certainly merit in debating the anarchocapitalist view that a fully private system would be the most desirable system, this essay focuses on the policy-application side of the debate. Due to the present political and fiscal environment, full privatization is not currently an alternative. Fortunately, there is a politically acceptable option currently available that would allow for more private sector involvement, while still allowing the government to exercise some minimal control—public-private partnerships. Combining the economic theory about how economic calculation fails with the application of innovative financing techniques such as public-private partnerships, I will explain how P3s will allow the private sector to reenter the domestic road-development arena. Building on this foundation, I will explain how P3s can help cover the financial shortfall needed to improve American transportation infrastructure, and how both politicians and private actors can benefit from this arrangement.