A Structural Equation Model of Feasibility Evaluation and Project Success for Public–Private Partnerships in Hong Kong
A successful public-private partnership (PPP) scheme can be described as one that can lead to the delivery of high-quality end products and/or services, which can satisfy the needs of the community, achieve the intended targets/goals of the government, as well as provide a favorable financial return for the private sector involved with the project. This study aims to establish an evaluation framework for the initial feasibility evaluation of a PPP project that would satisfy all the stakeholders. The factors for evaluating the feasibility of PPP projects can be classified into five broad categories: technical; financial and economic; social; political and legal; and others. Through the structural equation modeling approach, data attained from a questionnaire survey conducted in Hong Kong was analyzed and a model was developed to examine the relationships between different evaluation factors and the overall satisfaction of stakeholders. The results indicate that technical and social aspects are critical to the feasibility of PPP projects, and therefore, are the determining factors for success. This paper should assist relevant stakeholders to improve their understanding on the relative importance of the evaluation factors, and help to establish a comprehensive framework for decision makers to evaluate the feasibility of PPP projects. The predictors for PPP project success were also determined to enrich the knowledge base and help formulate management strategies to better implement the PPP project delivery approach.