Blog » TCE COMMENTARY ON DOMESTIC WATER PPPs IN METRO MANILA AND SURROUNDING PROVINCES 7232014 revised 7272014(Autosaved).pdf
The above is an analysis I did using TCE to comment on a World Bank case study of the water and sanitation sector of Metro Manila. The details of the case studies are described in my comment; it served as an example of how TCE can be used. The comment is in response to the presentation I gave on June 18th to the Economist's Chapter of the 1818 Society. You will note that the entire orientation is different than what is found in typical institutional analyses done by the Bank or anyone else. This is the beauty of TCE; it opens up a whole new perspective, nay, a whole new world of explanatory power that is much closer to the phenomena being analyzed.
Neil, I've had the chance to read through your TCE analysis of domestic water PPPs in Manila. Of course, I'm not able to completely grasp TCE from just this analysis, but I did find it impressive that through the tools of TCE, you were able to elucidate the factors -- so often hard to easily define -- that led to the PPPs' success. In this way you've shown TCE to be an essential tool in analyzing institutional performance.
I did have two quick questions after reading through your analysis; however I recognize that your TCE analysis builds on an existing World Bank case study, so I apologize if you're unable to answer them.
First, I noticed that the geographic area covered by the study was quite broad -- in addition to Metro Manila, several rural areas in other parts of the country were included. I would have thought that the size of water-providing organizations at the metro and rural levels differ so greatly that it would be hard to effectively compare them...would factors like this affect TCE analysis, or can your model be used irrespective of the institutions' size and location?
Second, how much of this analysis is specific to the water & sanitation sector? Your main thesis seems to be that ensuring a sustainable balance through the three pillars of alignment, credible commitment, and stimuli was central to the successes observed in the study; through your experiences, do you feel this would be applicable to projects in the transport sector as well?
I thought your analysis brought up of number of excellent points, and I especially liked how you highlight the importance of the customer as a key player that can provide needed stimuli. Moreover, your statement that "Parties thus have an interest in promoting continuity in the face of unforeseen disturbances and hence move to a more cooperative and adaptive contracting form" was an eloquent point in favor of hybrid governance PPP models.
Thanks again for sharing this analysis -- I know the group appreciates it!