This paper considers the choice between different approaches to contract for the construction and maintenance of infrastructure projects. The need to control for user and third party costs over the life cycle of an asset is demonstrated to be a core aspect of welfare maximising contract design....

Conventional models of a mixed oligopoly usually predict modest welfare improvements, because they are based on assumptions of increasing marginal costs and/or relative inefficiency in the public firm. Both assumptions can be questioned, but it is well known that the private firms would...