Marco Bertoni
email: marco.buso@nancy.inra.fr

Massimiliano Bratti

Alessandro Bucciol

Michael Klien

Scott Masten

Johan Nystrom

Stéphane Saussier

Stéphane Straub

Luciano Greco

Mario Padula

Lorenzo Rocco

Paola Valbonesi

Luigi Moretti

Public Private Partnerships from Budget Constraints : Looking for Debt Hiding ?

In this paper, we examine whether budget-constrained public authorities are more likely to use a PPP (Public Private Partnership) than traditional procurement methods. Then, we study the possible mechanisms underlying this choice. Our empirical test focuse s on France and consists of a two-stage approach. First, we examine the impact of budget constraints on the use of PPPs and find a positive relationship. Second, to better delineate the debt hiding e ect, we exploit the 2011 changes to the ability to underwrite PPP debts. We find that debt hiding is a relevant, but not a su cient element to explain budget-constrained governments' attitudes towards PPP.

Introduction

In recent decades, governments' behaviors and policies have been significantly a ected by public financial restraints stemming from domestic policies, financial markets, or regulatory measures. One prominent example is the limits on deficits and debt imposed by the European Union according to the terms of the 1992 Maastricht Treaty. As a consequence, resources available for pursuit of public investment strategies have been increasingly rationed, which in turn makes the choice of an e cient organizational structure crucial for the realization and management of public investments. In this context, alternatively to the traditional "markethierarchy" or the "public-private" dichotomy,1 , hybrid organizational forms such as Public Private Partnership (hereafter PPP)2 has grown considerably in recent decades and nowadays account for a significant portion of public investment [START_REF] Posner | Public-private partnerships: The relevance of budgeting[END_REF]).

Under budget constraints, however, this organizational choice is subject to debate and criticism because PPPs are considered more costly than traditional public funding methods, in terms of both organizational and financial costs (see [START_REF] Marty | Public-private-partnerships under financial crisis: Value for money versus a ordability[END_REF] for a review).This question raises concerns because the determinants of organizational choice in the public sector are known to be particularly crucial due to fundamental di erences between public and private actors' respective organizational purpose, incentives, and behavior [START_REF] Mahoney | Perspective-the interdependence of private and public interests[END_REF], [START_REF] Hodge | Public-private partnerships: an international performance review[END_REF], [START_REF] Rangan | Constructive partnerships: When alliances between private firms and public actors can enable creative strategies[END_REF], [START_REF] Zeng | Achieving cooperation in multiparty alliances: A social dilemma approach to partnership management[END_REF]). In this stream of literature, the private sector, which represents for-profit organizations, has a smoother decision-making processes. In contrast, the public sector experiences more turbulence, interruptions, recycles, and conflict (e.g., [START_REF] Perry | The public-private distinction in organization theory: A critique and research strategy[END_REF], [START_REF] Rainey | Comparing public and private organizations[END_REF], [START_REF] Ring | Strategic management in public and private organizations: Implications of distinctive contexts and constraints[END_REF]). Moreover, as suggested by the long-standing theoretical tradition on public choice and the related emergence of New Public Management approach (hereafter NPM) in public policy, public managers are not considered to di er from private managers. They are self-interested and rational decision makers who primarily seek to maximize their personal utility [START_REF] Niskanen | Bureaucrats and politicians[END_REF]). Both types have conflicting incentives in meeting the responsibilities to manage the organization well and achieve some private benefits [START_REF] Yaari | Earnings management[END_REF]).

As a consequence, practitioners often consider the use of PPP under budget constraints as being to their fiscal advantage [START_REF] Nao | Lessons from PFI and other projects[END_REF]), PwC [2010]). Indeed, the 2004 Eurostat decision classifies PPPs as non-governmental according to the "risks and rewards" criterion [START_REF] Heald | The substance of accounting for public-private partnerships[END_REF]). Following this guidance, public authorities can account for PPP activities as being o balance sheet when the construction risk and at least one of either availability or demand risk are transferred to the private operator 3 . This accounting rule might therefore increase incentives in favor of PPPs for reasons other than the to-be-achieved advantages of this organizational form. This motivation might be even more important given the recent fiscal constraints on the public sector to reduce public debt. This trend has been reported not only in the UK, but also in other European countries such as Greece, Spain, Portugal, and Ireland. 4 As a consequence, more o cially, a July 2011 report by the UK House of Commons in recommended limiting the use of PPP (Parliament [2011]).

In the private sector, a similar accounting strategy (but more widespread in terms of practice) is called earnings management, i.e., a collection of managerial decisions that results in the true short-term, value-maximizing earnings as known to management not being reported [START_REF] Yaari | Earnings management[END_REF]). The motivation behind the use of this accounting strategy has been widely studied. In general, scholars find that managers often use this method to window-dress financial statements prior to public securities o erings. This strategy can have the objective of improving firms' financial capacity, i.e. which is beneficial for shareholders. At the same time, it can reflect managers' self-interested motivations such as increasing their own compensation and job security, even though such actions might destroy value and harm shareholders (see [START_REF] Yaari | Earnings management[END_REF], [START_REF] Healy | A review of the earnings management literature and its implications for standard setting[END_REF] for a review).

This question has also largely studied in terms of the public sector. Recently, [START_REF] Klien | Public-private-partnerships in france: Who, why and why not? Workingpaper[END_REF] find that under an environment of high political competition, where mayors have uncertain futures, they are more likely to choose PPP instead of traditional procurement to realize public investment in infrastructure. The authors o er two main explanations of this result. First, mayors might seek to achieve better projects through PPPs. Second, mayors might seek to manage earnings, i.e., hide public debt, in order to gain voters support. However, no empirical evidence exists on this topic. Other scholars in the public finance field seem to agree regarding public managers' motivation in using budget gimmicks to satisfy general regulatory measures [START_REF] Buti | From deficits to debt and back: political incentives under numerical fiscal rules[END_REF], Von [START_REF] Von Hagen | What do deficits tell us about debt? Empirical evidence on creative accounting with fiscal rules in the EU[END_REF], [START_REF] Milesi-Ferretti | Good, bad or ugly? on the e ects of fiscal rules with creative accounting[END_REF], [START_REF] Peterson | Changing red to blanc: Deficit closing alchemy[END_REF], [START_REF] Bri Ault | Balancing acts: the reality behind state balanced budget requirements[END_REF], [START_REF] Easterly | When is fiscal adjustment an illusion?[END_REF]). In the public choice field, scholars also find evidence for public managers' actions in terms of public policy towards balanced budget requirements. These practices might be either beneficial to public organizations [START_REF] Hou | Debt as a countercyclical fiscal tool[END_REF]) or opportunistic [START_REF] Rose | Do fiscal rules dampen the political business cycle?[END_REF]).

In this article, we aim to explain why the public actors choose PPP when they face some financial restraints. More specifically, we try to find evidence for managers' adoption of a PPP strategy only for fiscal circumventing motivations, i.e., putting public debt o the balance sheet. Several studies have found a correlation between the use of PPPs and financial constraints (see [START_REF] Hammami | Determinants of public-private partnerships in infrastructure[END_REF] for the country level, and [START_REF] Albalate | The determinants of contractual choice for private involvement in infrastructure projects in the United States[END_REF] for the local government level). We go further in explaining the rationale behind the choice of this organizational form when governments are budget constrained.

Using data from France, we first empirically test if local governments are more likely to use PPPs under budget constraints. Exploiting a feature of French institutional context, where it has been mandatory for local PPP to be accounted for on the public account since January 1st, 2011, we are then able to identify if this behavior occurs due to a fiscal circumventing motivation, i.e. debt hiding. As a conclusion, we find that strict budget constraints are associated with a more frequent tendency to invest through a PPP. However, while the new rule negatively impacts the use of PPPs, the e ect of budget constraints persists, especially when financial costs are considered. We then conclude that the adoption of PPPs is driven by restrictions on financial resources, not merely for debt hiding motivations.

We contribute to the literature in several ways. First, our research question sits at the cornerstone of both the Public Administration Management (hereafter PAM) and Public Financial Management (hereafter PFM) fields. While PAM scholars often focus on the activities and managerial practices of public administrators [START_REF] Svara | The myth of the dichotomy: Complementarity of politics and administration in the past and future of public administration[END_REF]), PFM research is well suited to address the e ects of complex technical activity on these practices [START_REF] Kioko | Why public financial management matters[END_REF]). Our paper follows the same approach in the sense of studying the impact of governments' financial situations on their organizational choices. Despite its relevance in the PFM field, this topic is rarely recognized in the PAM mainstream [START_REF] Kioko | Why public financial management matters[END_REF]) 5 . Second, we are the first to study the adoption of PPPs according to its specific decision making structure, i.e., French municipalities. We benefit from the fact that we obtained data on all PPP projects adopted by local governments and that we are able to make a comparison between a suitable group of municipalities out of all 36,000 French municipalities. Finally, we are the first to shed light on the reason behind the choice of PPP under budget constraints. This is a crucial point as it has been contested by both academics and practitioners. Our conclusion can therefore provide better understanding of PPP adoption from both a theoretical and practical standpoint.

The paper is organized as follows. Section 2 describes the related literature and derives testable hypotheses. Section 3 discusses the French institutional context and legal environment regulating PPPs. Section 4 presents a description of the data and our empirical approach. Section 5 reports the analysis result and robustness checks. Section 6 discusses several main results. Finally, Section 7 concludes.

5. Some noteworthy exceptions of PFM studies that are relevant in the PAM field are [START_REF] Hou | Budgeting for fiscal stability over the business cycle: A countercyclical fiscal policy and the multiyear perspective on budgeting[END_REF], [START_REF] Hou | The case for countercyclical fiscal capacity[END_REF], [START_REF] Krause | Institutional design versus reputational e ects on bureaucratic performance: Evidence from us government macroeconomic and fiscal projections[END_REF], [START_REF] Thompson | Betting on the future with a cloudy crystal ball? how financial theory can improve revenue forecasting and budgets in the states[END_REF].

Related literature and Hypothesis development

Financial constraints and PPP

The first objective of the present study is to determine whether public managers choose PPPs as an organizational choice when they are financially constrained. This question is therefore not limited to the "make or buy" strategy but also the strategy of "how to buy". Indeed, the choice of each available organizational form has to be explained: why is this particular mode of transacting preferred over others? In our case, the most frequently considered alternative strategy to PPPs is the simple contract model, i.e., traditional procurement. As such, the question is more specifically why PPPs would be preferred over traditional public procurement methods.

This question of organizational strategy represents the choice between hybrid organizational forms (PPP) and the market model (traditional procurement). This aspect has been largely studied by transaction cost theory scholars (hereafter TCT). In this stream of literature, managers are believed to always select the lowest-cost transaction structures that e ectively protect firms against partner opportunism ,i.e., "self-interest seeking with guile" [START_REF] Williamson | The Economic Institutions of Capitalism[END_REF]), ensure that partners fulfill contractual obligations, and provide a framework for dealing with uncertainties [START_REF] Williamson | The Mechanisms of Governance[END_REF], [START_REF] Williamson | Comparative economic organization: The analysis of discrete structural alternatives[END_REF]). Under a hybrid model, the legal ramifications and coordination complexities are considered to typically involve higher costs than those of simple contracts [START_REF] Hennart | Explaining the swollen middle: Why most transactions are a mix of market and hierarchy?[END_REF], [START_REF] Kogut | Joint ventures and the option to expand and acquire[END_REF], [START_REF] Murray | Joint Ventures and Other Alliances: Creating a Successful Cooperative Linkage[END_REF]). However, that simple contracts might become inadequate for certain types of transactions for several reasons: first, partner opportunism is often di cult to detect; second, firms invest in specific assets; and third, product attributes or performance objectives cannot be precisely specified ex ante [START_REF] Heide | The role of dependence balancing in safeguarding transaction-specific assets in conventional channels[END_REF], [START_REF] Williamson | Markets and Hierarchies, Analysis and Antitrust implications: A Study in the Economics of Internal Organization[END_REF]). As a consequence, a hybrid model might be an e cient means to reduce these governance problems. Economic efficiency implies that if the hybrid format is chosen, its benefits are judged to outweigh their higher costs [START_REF] Hennart | Explaining the swollen middle: Why most transactions are a mix of market and hierarchy?[END_REF], [START_REF] Kogut | Joint ventures and the option to expand and acquire[END_REF]).

In the same line, and more relevant to our topic, scholars from the economics field argue that PPPs may be preferable to traditional procurement even when governments are credit constrained (see [START_REF] Engel | The basic public finance of public-private partnerships[END_REF], [START_REF] Auriol | A theory of bot concession contracts[END_REF], [START_REF] Buso | Public and private finance of PPPs[END_REF]). These studies focus on analyzing how the costs imposed on taxpayers to collect funds for financing an investment, i.e., distortionary taxation, can a ect the choice between PPPs and traditional procurement. According to [START_REF] Engel | The basic public finance of public-private partnerships[END_REF], the presence of a shadow cost of public funds (lower governmental spending capacity) is not a su cient argument for preferring PPP in a multiperiod context unless governments are hit by liquidity constraints. Conversely, [START_REF] Auriol | A theory of bot concession contracts[END_REF] find that shadow costs become relevant when comparing the public regime with PPPs 6 for the realization and operation of a public facility 7 . Their paper examines a di erent context than that explored in 6. More precisely, they studied Build-Operate-Transfer (BOT) contracts. In this type of PPP, the private partner is in charge of construction, operation, and financing tasks.

7. This type of organizational form excludes the financing task. [START_REF] Engel | The basic public finance of public-private partnerships[END_REF]. Indeed, their model assumes that the private actor is allowed to operate under a laissez-faire regime. Furthermore, under the PPP solution, the private actor is the project manager. Therefore, information asymmetries are much weaker compared to those in traditional procurement, where the public actor is the project manager. Despite following a di erent approach, [START_REF] Buso | Public and private finance of PPPs[END_REF] reach a similar result. Their theoretical model is also built under the context of asymmetric information but the level of public service provision is set by the government both under PPP and traditional procurement. Within this framework, savings on distortionary costs under PPP come from the implicit incentive of the private actor due to his long-term involvement in the project.

On the empirical side, evidence is found for the impact of fiscal restrictions on the choice of PPPs. At the local government level, [START_REF] Russo | Machiavellian PPP? Evidence from Italian local government's projects for public services[END_REF] correlate PPP investment and municipal budget data in the Italian context. They show a strong positive relationship between local public debt and the number of PPP projects. Deficit, in contrast, is not statistically related to PPP choice. Similarly, [START_REF] Albalate | The determinants of contractual choice for private involvement in infrastructure projects in the United States[END_REF] find a positive impact of debt level on the level of private involvement in public projects in the US. However, their results show a negative impact from tax revenue. They argue that states with higher revenues are likely to be less reliant on private investment. Hence self-finance capacities seem to have the opposite e ect of debt. In the same context as ours, [START_REF] Klien | Public-private-partnerships in france: Who, why and why not? Workingpaper[END_REF] also find that French municipalities' debt and deficit levels are positively associated with the use of PPP.

We then develop our first hypothesis: Hypothesis 1: When governments are financially constrained, public managers are more likely to use PPP than traditional procurement to realize public infrastructure.

PPP under Financial Restraints: Fiscal Circumvention Motivations

In the private sector, earnings management practices, i.e., a collection of managerial decisions that results in not reporting true short-term, value-maximizing earnings as known to management, have been widely studied [START_REF] Yaari | Earnings management[END_REF]). Firms operating under financial constraints are found to be more likely to distort their reported financial performance. Motivations behind this strategy might be to raise capital, attract external financing, or improve investment eciency [START_REF] Linck | Can managers use discretionary accruals to ease financial constraints? evidence from discretionary accruals prior to investment[END_REF], [START_REF] Dechow | Causes and consequences of earnings manipulation: An analysis of firms subject to enforcement actions by the SEC[END_REF], [START_REF] Dechow | Predicting material accounting misstatements[END_REF], [START_REF] Jackson | Economic consequences of firms depreciation method choice: Evidence from capital investments[END_REF], [START_REF] Teoh | Earnings management and the long run market performance of initial public o erings[END_REF]). In a di erent vein, other studies argue that private managers have self-interested motivations to use this accounting strategy (see [START_REF] Fudenberg | A theory of income and dividend smoothing based on incumbency rents[END_REF], [START_REF] Adams | The role of boards of directors in corporate governance: A conceptual framework and survey[END_REF] for theoretical perspectives on this issue). Many empirical studies have also found evidence regarding managers' motivation to boost their own compensation [START_REF] Burns | The impact of performance-based compensation on misreporting[END_REF], [START_REF] Bergstresser | Ceo incentives and earnings management[END_REF], [START_REF] Efendi | Why do corporate managers misstate financial statements? the role of option compensation and other factors[END_REF], [START_REF] Cornett | Corporate governance and pay for performance: The impact of earnings management[END_REF]) or to address to their career concerns [START_REF] Defond | Smoothing income in anticipation of future earnings[END_REF]).

In the public sector, governments are also found to react to financial con-straints. The public finance literature focuses on this topic in a general way and stresses that public actors have an incentive to shift debt o the public budget, potentially to meet fiscal constraints or to gain voter support. Originally, Easterly [1999]'s theoretical model claims that constraints on conventional measures of budget deficits or public debt will only induce an illusionary fiscal adjustment since government will prevent changes to its net worth. The argument states that governments seek to maintain current spending levels while reducing explicit debt and deficits, by "(1) cutting public investment, (2) privatization, (3) shifting revenue and expenditure over time, or (4) running implicit liabilities." [START_REF] Buti | From deficits to debt and back: political incentives under numerical fiscal rules[END_REF] found a positive correlation between deficits/debts and the recourse to stock-flow adjustment, i.e., hiding deficits or selling assets. They claimed that the adoption of the Stability and Growth Pact seemed to be associated with a greater use of fiscal gimmicks. Taking a broader approach, [START_REF] Milesi-Ferretti | Good, bad or ugly? on the e ects of fiscal rules with creative accounting[END_REF]'s theoretical model showed that under strong fiscal rules, creative accounting appears. Following this model, Von [START_REF] Von Hagen | What do deficits tell us about debt? Empirical evidence on creative accounting with fiscal rules in the EU[END_REF] provided empirical evidence regarding government use of creative accounting to circumvent fiscal rules. According to their findings, the 1997 introduction of the Stability and Growth Pact in the European Union resulted in the use of creative accounting. More precisely, in order to hide deficits, governments used stock-flow adjustment such as annual changes in the debt level less annual budget deficits. As a result, in reality, the debt level should have been higher than o cial deficits suggest. Finally, with a similar objective, [START_REF] Milesi-Ferretti | Fiscal adjustment in eu countries: A balance sheet approach[END_REF] took a di erent approach and analyzed whether or not the reduction of government debt in the EU is correlated with a reduction of government assets in the context of euro adoption. They found a strong correlation between debt reduction and asset sales as well as reductions in public investment in the previous year. This result suggests that "an exclusive focus on deficit and debt levels conveys a misleading picture of the evolution of the underlying fiscal situation." As a result, in the context of financial restraints, a public manager may choose a PPP to reduce the o cial municipal debt burden. In the same line of thought, scholars of the PFM and public choice fields focus on the impact of balanced budget requirements on public policy in terms of financial issues [START_REF] Hou | Do state balanced budget requirements matter? testing two explanatory frameworks[END_REF]. Among others, [START_REF] Chaney | The e ect of fiscal stress and balanced budget requirements on the funding and measurement of state pension obligations[END_REF] conclude that balanced budget requirements reduce pension fund levels as states draw from these funds to meet balance requirements. Another finding concerns the debt management behavior of public managers. Indeed, [START_REF] Hou | Debt as a countercyclical fiscal tool[END_REF] argues that under financial constraints, governments might seek to retire debt in boom years in order to preserve their debt capacity and reduce borrowing costs. However, they will incur debt in bust years to obtain a lower interest rate. Finally, opportunistic behavior of public managers is drawn from [START_REF] Rose | Do fiscal rules dampen the political business cycle?[END_REF]. This study shows that public managers, under strict no deficit carry-over rules, counter preelection spending and post-election restraint patterns that characterize political business cycles.

As a consequence, debt hiding might be a possible motivation to explain the adoption of PPPs in a budget-constraint context. In isolating specific debt hiding motivations, we evaluate their relevance and the extent to which they explain the financial restraint e ect on the use of PPP.

Hypothesis 2: Without the possibility of debt hiding, the impact of financial restraints on the use of PPPs should decrease significantly.

Institutional details

In this section, we first focus on describing French municipalities' budget elaboration and control processes. Then, we analyze how PPP accounting rules can lead to debt-hiding behaviors. Finally, we present the French PPP context.

French municipalities' budgets

France has 36,000 municipalities, which are called "communes" and represent the fifth administrative level in France. Each has a mayor and a municipal council who jointly manage the area's administration and have exactly the same powers no matter the commune's size. In terms of investment, they are in charge of pre-primary and primary schools, libraries, cultural/sport centers, and urban equipment. The principle of municipal self-government leaves gives the municipality wide scope to take responsibility for its own investments, organization, and financing. However, their budgets are constrained as they have to achieve a balanced public account for both investment and operation sections. This balanced budget requirement contains both political and technical dimensions in the sense of [START_REF] Hou | Budgeting for fiscal stability over the business cycle: A countercyclical fiscal policy and the multiyear perspective on budgeting[END_REF].

Following the General Code for Local Authorities, 8 municipalities are obliged to annually specify their balanced budget for the coming year, which should contain a plan for balancing their investment and the operating budgets. Operating revenue is mainly composed of local taxes and government grants. Operating expenses are those related to the municipality's on-going operations: sta salaries, infrastructure maintenance costs, expenses related to the municipality missions, and financial costs of existing debt. Investment revenue comes from several sources. Operating budget surpluses provide the majority of the investment budget (42% in 2012). Government transfers and subsidies represent 24%, duties 10%, and finally, local taxes and loans represent the remaining 24% [START_REF] Ofl | Les finances des collectivités locales en 2013 : Etat des lieux. Rapport Observatoire des Finances Locales[END_REF]). Investment expenses cover annual debt service payments as well as new investments in infrastructure. It is important to emphasize that France has a "golden rule" regarding the public budget: public authorities can borrow only to invest and not to fund current operational spending.

As enacted in the Constitution in 2008, public accounts must be balanced as a multi-annual objective. This objective is controlled by two levels: the Administrative Courts and the Regional Court of Accounts (Chambre régional des Comptes). The first control includes the Prefect's supervision over the e ective balance of 8. France's General Code for Local Authorities (Code général des collectivités territoriales -CGCT ) includes laws and regulations applied to local authorities' three main levels: municipality, department and region. municipalities' accounts, as well as the possibility of the administrative courts taking action against a mayor's misuse of power. The second instrument aims at checking both the ex ante achievement of the balanced budget requirement and ex post excessive deficits with respect to balanced budget targets (5-10%) 9 .

In such a context, heavily indebted municipalities have higher levels of budget constraints placed upon their ability to achieve their infrastructures investment strategies (CES [2012]). Public investment levels in France are known to have dropped in the 1990s due to a hard budget constraint and a high level of public debt. In fact, existing debt is a burden for municipalities' operating and investment budgets: high level of existing debt pushes up both the corresponding financial costs (which are part of the operating expenses) and the annual debt service (which are part of the investment expenses). As a consequence, the selffinancing capacity of these municipalities is reduced. In order to achieve the same level of investment as other municipalities, they can only take larger and more costly loans from commercial banks.

PPP and Debt Hiding motivations

As discussed above, given that PPP could be accounted o balance sheet following the Eurostat decision in 2004, it seemed to o er a possible method to circumvent budget constraints. The Eurostat rule classifies infrastructure realized through PPP as non-governmental through the "risks and rewards" criterion [START_REF] Heald | The substance of accounting for public-private partnerships[END_REF]). Following this guidance, public authorities have accounted PPPs o balance sheet when the construction risk and at least one of either availability or demand risk are transferred to the private operator. In such a manner, a PPP was accounted based on the logic of accrual accounting: the annual payment related to investment, financial, and operating costs was reflected in the public account; the remaining debt element was accounted as a multi-annual plan of payment in an appendix to the balance-sheet. As a consequence, debt corresponding to a PPP did not appear on the public balance sheet.

This accounting rule might increase incentives in favor of PPP procedures for other reasons than the to-be-achieved target of value for money. The first level is the budgetary level. As discussed in Section 3.1, PPPs can enable public authorities lacking a su cient capital budget to nevertheless achieve their desired capital investment strategy. In fact, while a traditionally procured capital project presents a significant immediate hit to a municipality's capital budget, PPPs will have a smaller (but much longer lasting) impact. Second, the French target, in place since 2005 to reduce Public Sector Net Debt from 66% of GDP to under 60%, could provide an incentive to favor PPP over spending funded directly by government borrowing. This reflects the fact that in the short term, a PPP scheme would result in reduced government borrowing and therefore a lower level of Public Sector Net Debt. Third, European level requirements, i.e., the Maastricht Treaty, obliges member states to avoid excessive budgetary deficits. More precisely, it states that governments' annual deficit and debt should not exceed: (a) 3% for 9. 10% for municipalities with a population less than 20,000 citizens, and 5% otherwise the ratio of planned or actual government deficit to gross domestic product at market prices, and (b) 60% for the ratio of government debt to gross domestic product at market prices (OJEU [2004]). These European fiscal rules therefore motivate the use of investment methods that allow o balance sheet accounting. Finally, public managers' self-interest can not be excluded. Indeed, a mayor might choose PPPs according to a debt hiding strategy in order to improve the public account with the objective of gaining voters support.

PPP in France and the New Accounting Rule

With a long tradition of using private capital in public services,10 , the French legal system features a wide range of PPPs which can be classified into two main categories: users-pay contracts and government-pay contracts (see [START_REF] Mappp | Typologie des PPP. comparaison juridique et terminologique des PPP dans les conceptions francaise et anglo-saxonne[END_REF]). The Contrat de partenariat, the most used of all the government-pay contracts, is one of the main drivers of the current PPP trend in France [START_REF] Epec | France: PPP units and related institutional framework[END_REF]). This form of PPP entails the bundling mechanism (in the sense of [START_REF] Hart | Incomplete contracts and public ownership: Remarks, and an application to Public Private Partnerships[END_REF]) and is the equivalent of the Private Finance Initiative created in 1992 in the UK.

French public authorities have to follow three steps for implementing a PPP. The first one is to conduct an évaluation préalable (hereafter "assessment study" or "preliminary assessment"). In this step, the public authority carries out an analysis (typically through a consultancy agency) to compare the PPP organizational form with alternative solutions regarding a project's global cost, performance aspects and risk sharing matters. In these preliminary assessments, the most used alternative solution is the traditional public procurement. This assessment of a central government project is then verified by the Mission d'appui aux partenariats public privé (hereafter MaPPP). This organization is the French PPP taskforce located in the Ministry of Economies and Finance. However, since its creation in 2004, the MaPPP department has produced appraisal reports for 163 local PPP projects. The second step is the procurement phase, where the competitive dialogue is the most-used awarding procedure. This step takes on average 15 months, after which comes the last step, where the preferred bidder is selected and the contract is signed (see EPEC [2012]).

At the end of 2010, the French Government introduced a Decree on the topic of PPP accounting rules. This Decree requires PPP projects at the local level to no longer be recognized o the balance sheet, and applies to both existing and new projects. Two reasons motivated this clarification of PPP accounting. First, it reflects a desire to follow the UK experience in PPP, which is the most advanced in the world. Indeed, in 2011, the UK Government committed to providing more transparency to PPP accounting. The O ce for Budget Responsibility decided to include an assessment of the impact of PPP liabilities in their fiscal sustainability report, a break with previous years' National Accounts (Parliament [2011]). Sec-ond, the application of the International Financial Reporting Standards (hereafter IFRS) implied a switch from the previously used "risks and rewards" criterion to the control criteria for PPP accounting. More precisely, under a PPP, if the public authority controls one of the following five aspects of the project, the corresponding debt should be accounted on balance sheet: (a) the private operator is not able to sell or take out a loan on the equipment, (b) the occupation of a public-owned domain, (c) the definition of the equipment's main features, (d) public services' management, (e) the revenue paid to the private operator for his service. This new rule has led to on balance sheet recognition of the asset and corresponding debt upon the infrastructure's delivery. In other words, the balance sheet records the investment's capital value as an asset, while the already-paid investment and remaining debt are recorded as liabilities. For both these reasons, we can argue that the rule is not a ected by PPP's supporters or detractors.

Data and empirical strategy

Data

Treated group: PPP Dataset

In the present study, we exploit the application of the 2011 Decree to isolate the possibility of debt hiding in order to answer to our research question. Indeed, the new regulation's implementation ensures a greater transparency regarding the governmental body's real financial situation and might therefore significantly reduce the temptation to choose PPPs to hide debt [START_REF] Dupas | Les nouvelles règles de comptabilisation des partenariats public-privé[END_REF]). To test our hypothesis, we choose to focus our analysis on the municipal level instead of including the two other levels of public administration, i.e., department and region. This choice allows us to study comparable public entities that have the same power of decision-making regarding public investment. Moreover, all studied dimensions are also equivalent among them.

Our principal dataset is comprises the totality of 101 PPP projects enacted at the municipal level. These projects were concluded between 2004 and August 2013 by 95 municipalities and inter-municipalities. 11 In order to preserve the comparability of the 101 observations, we choose the biggest municipality of the inter-municipalities as the public actor. We collaborate with the MaPPP department to collect the main project characteristics such as the concerned public entity, year of signature, type of project, and its capital value. of assessment studies suggests that the number of PPPs will not rebound to pre-2011 levels in the near future [START_REF] Klien | Public-private-partnerships in france: Who, why and why not? Workingpaper[END_REF]). We also note that our sample includes 55 PPP projects before 2011 and 56 after 2011. Therefore, the two groups are equivalent in terms of number for a comparison of the e ect of the 2011 Decree.

Control group: Matching Strategy

To analyze the reasons behind the choice of PPPs in France under a budget constraint context, we utilize a matching strategy to select a control group that is similar to our treated group in terms of need for public infrastructure. This need is determined through a dataset describing the characteristics of all 36,000 French municipalities provided by the French National Institute of Statistics and Economic Studies (INSEE).12 . The use of a matching strategy particularly fits our need. Indeed, this choice-based sampling design is frequently chosen in evaluation studies to reduce costs of data collection in situations where the potential control population is much larger than the treatment sample [START_REF] Rosenbaum | Constructing a control group using multivariate matched sampling methods that incorporate the propensity score[END_REF], [START_REF] Rubin | Combining propensity score matching with additional adjustments for prognostic covariates[END_REF], [START_REF] Heckman | A note on adapting propensity score matching and selection models to choice based samples[END_REF]).

We first estimate the propensity score using a logistic regression and a nearest neighbor estimation. The dependent variable is a dummy describing whether or not a municipality has undertaken a PPP investment. The covariates represent municipalities' need for infrastructure. We not only follow [START_REF] Bahl | State and local debt burdens in the 1980s: A study in contrast[END_REF] in using municipality population and the income level to measure public investment demand but also include other variables covering the years 2009, 2010, and 2011: population, area, number of households, total income, total tax revenues, number of workers, number of unemployed people, population age distribution, number of firms in di erent sectors, number of public firms, and number of small and medium enterprises. Second, we choose the two nearest neighbor observations in terms of propensity score for each municipality in our treatment group. We thus finally obtain a sample of 303 municipalities, with 101 included in the PPP group (hereafter "treated group") and 202 in the group without PPP (hereafter "control" group). We report the similarities of our two groups during the study period in Tables 2 and3.

Financial and Political Datasets

In order to analyze our research questions, we collected financial data for the period between 2004 and 2012 for virtually all French municipalities from the website of the Ministry of Economy and Finances. 13 This dataset records the general financial information on each municipality's yearly accounting statement of such as investments and expenses, as well as the revenue structure including deficits and public debt. In this dataset, municipalities are organized in 30 "reference groups" classified by population size, participation in public establishment of inter-municipal cooperation, and any additional tax systems adopted by the inter-municipal institution. For each reference group, the average value of each financial dimension is provided. Therefore, in our analysis, we are able to consider the di erence of each financial variable for each municipality from those of its reference group. Accordingly, we are therefore able to compare municipalities to others within the reference group as well as compare each to the reference group over time. We also consider the gross value of each financial dimension as a robustness check and find that results do not di er. For the remainder of the paper, we therefore only mention the di erence in value between municipalities' financial dimensions.

Two other datasets are used to capture political and managerial dimensions. The first one comes from the Center of Socio-Political Data at the Paris Institute of Political Studies (Sciences Po). This dataset contains the main information about municipal elections, for example the mayor's political party. We complement this by adding information on the mayor's personal characteristics taken from the National Repertory of Politicians dataset of the Ministry of Interior. 14 Finally, we obtain a panel dataset allowing us to compute the e ect of a municipality's financial constraint on the use of PPPs instead of alternative organizational forms. Table 1 gives the main financial characteristics of our treated and control groups. The reported values are the means over the period 2003 -2012. As the treated group is composed of 101 municipalities having concluded PPPs, the level of investment made under PPPs is on average 32.3 million euro. This value is logically 0 for the control group, i.e., the group without PPPs. In 14. These two datasets are available from these organizations upon request.

Final Panel Dataset

general, we observe a better financial situation for the control group. Indeed, this group has a higher positive level of results in both the operation section of the budget, i.e., operation ≠ result (5.5 million euro versus 4.8 million euro) and the overall budget result, i.e., overall ≠ result (5.9 million euro versus 4.7 million euro). At the same time, the control group has lower subsidies from the central government helping the operation section (21.6 million euro versus 24.4 million euro). Moreover, while the control group annually invests more (29.9 million euro versus 26.2 million euro), they have lower debt levels, both in terms of stock of debt (45.2 million euro versus 63.6 million euro) and in terms of annual debt payment (5.6 million euro versus 9.3 million euro). These figures therefore show that the control group has a better self-financing capacity than the treatment group. The level of annual investment of these two groups also shows that municipalities in the control group have their own investment strategies but did not choose PPPs as their organizational form.

Description of variables

As we use a panel database covering the period 2003 to 2013, all variables are defined for each municipality i and each year t. The variables' descriptions with the expected signs are reported in Table 4.

Time variables

As previously discussed, we are interested in explaining the use of PPPs by French municipalities. We introduce our dependent variable which represents municipalities that made PPP as an organizational choice. If municipality i in year t has implemented a PPP, then ppp it equals to one in t and until the end of the period, i.e., 2013; and equals zero for the entire period before year t 15 .

Explanatory variables

As there is no universally accepted measure of financially constrained firms [START_REF] Linck | Can managers use discretionary accruals to ease financial constraints? evidence from discretionary accruals prior to investment[END_REF]), even less for the public sector and municipality financial situation, we consider three measures for our explanatory variables. To avoid endogeneity issues, these variables are lagged by one year. We follow [START_REF] Bahl | State and local debt burdens in the 1980s: A study in contrast[END_REF] in using both stock and flow measures for debt burden. The stock variable, debt it≠1 , captures the municipality's ex ante exogenous situation. We then use two flow variables to measure how a municipality's conditions change during the period preceding the investment start: annual ≠ payment it≠1 captures annual debt expenses (interest and capital reimbursement), and self ≠f inance it≠1 captures a municipality's self-financing capacity (the surplus from the operating budget that can be used to finance new investment). 16Debt hiding reasons for engaging in PPPs in France were ruled out in 2011. We account for this legal discontinuity by introducing the variable rule t , which equals one for periods of time preceding January 1st 2011 and is zero otherwise. 17 . We are interested in the interaction term among rule t and each financial restraint proxy. These interaction terms show the extent to which the e ect of each proxy changes after 2011.

Finally, we include the post2011 statistic, which is the sum of the e ects of each financial proxy and its interaction term with the rule dummy. This coe cient captures the e ect of each proxy on the use of PPPs after 2011.

Control variables

Given that we have a panel database and are comparing similar municipalities in terms of population features, we first select those financial covariates that vary over time and could influence both the dependent variable and financial restraint proxies. We consider financial variables that reflect municipalities' capacity to deal with both the investment's demand and the balanced budget requirements. The first variable controls for the balancing of the operating and the investment budgets as required by the balanced budget specifications. We use budget ≠ result it≠1 , which is the di erence between the operation ≠ result it≠1 and the investment spending of municipality i at t ≠ 1. Finally, we consider two other variables that control for both the size of the investment and the level of the ex ante available resources: investment it≠1 , which captures the total level of investment by municipality i at t ≠ 1, and subsidies it≠1 which reflects the level of national support the municipality received for its investment plans at t ≠ 1. 18 We then include three political dimensions that may a ect the selection of PPP at the municipal level: lef t it≠1 , center it≠1 , or right it≠1 , which equal one if the mayor of municipality i is from the left (center or right) wing party at t ≠ 1 and is zero otherwise. This measure is widely used in the PPP literature (see [START_REF] Klien | Public-private-partnerships in france: Who, why and why not? Workingpaper[END_REF] for a review). The variable f emale it≠1 represents the sex of the mayor and equals one if the mayor of municipality i is female at t ≠ 1 and is zero otherwise. This measure is also widely used in the management literature to examine organizational choices (see [START_REF] Klien | Public-private-partnerships in france: Who, why and why not? Workingpaper[END_REF] for a review). We also include the institutional proxy EQI (European Quality of Government Index) at the regional level [START_REF] Charron | Regional governance matters: quality of government within european union member states[END_REF]). This index is the combination of the level of corruption, protection of the rule of law, government e ectiveness, and accountability at regional levels in the 27 EU Member States. The measures are collected in 172 EU regions, based on a survey of 34,000 residents across 18 countries [START_REF] Charron | Regional governance matters: quality of government within european union member states[END_REF]). It controls for the municipality's institutional aspect.

municipalities.

17. In our regressions, we use the interaction between the dummy rule t and a trend variable to capture the change in trend on the probability to implement PPP after the application of the Decree.

18. To prevent collinearity problems, we perform our regressions with each control variable as a robustness check.

Finally, we add three main variables used for the matching strategy as control variables to verify its e ciency: population it≠1 (the log of the population of each municipality), income it≠1 (the log of the income of each municipality), f irm it≠1 (the log of number of firms in each municipality).

Empirical Strategy

We aim to explore the determinants of a municipality's decision to use PPP or wait both before and after 2011, as that year marks the introduction of a new accounting rule into the legal system.

As some municipalities decide to invest after the creation of a PPP market, di erent investment times are available over the period 2005-2013. The starting year is the same for every municipality ( 2005), but data are incomplete. Municipalities that did not invest within the period are necessarily right censoring. Duration or hazard models are designed to take this issue into account [START_REF] Hosmer | Applied Survival Analysis. Regression Modeling of Time to Event Data[END_REF], [START_REF] Machin | Survival analysis: a practical approach[END_REF], and [START_REF] Chen | Survival duration of plants: Evidence from the us petroleum refining industry[END_REF]).

In duration or survival analyses time is the outcome variable of interest. More precisely, the dependent variable is defined as survival time because it provides the interval until a certain event (failure) occurs. The terminology suggests the main application areas are health and financial economics. However, this approach can be applied to any type of event that a ects individuals in di erent moments. Our research question is a suitable application of the duration analysis because increasing numbers of municipalities used PPPs during the period 2005 -2013 and we can expect that, in the long run, this technique would become even more widespread among public operators.

In our case, investment action under a PPP represents the event (failure), while the survival time is given by the number of years until an investment under a PPP takes place. In such an analysis, we use the entire database comprising both our treatment and control groups. Thus, the time is right censoring for all municipalities that do not experience the event prior to 2013.

The introductory step of the survival analysis consists of computing the Kaplan-Meier survival curve, S(t), and the Hazard rate function, h(t). The first is computed year by year and reports the proportion of municipalities that survive (do not use PPP) over time. The second gives the instantaneous potential per unit time for the event to occur given the survival up to time t.

The next step allows us to assess the relationship between explanatory variables and survival time. More precisely, it allows us to identify the factors that determine the probability of implementing a PPP and how the new rule a ected this propensity to use PPP. We approach the problem through two methods that aim at computing the hazard rate, that is, the instantaneous event rate.

The first one is a semi-parametric method, the Cox proportional hazard model. This model makes a major assumption that the hazard rate (instantaneous event rate) is proportional to the covariates (PH assumption). This means that the risk of failure (PPP use) is the same no matter how long the municipality has been followed [START_REF] Hosmer | Applied Survival Analysis. Regression Modeling of Time to Event Data[END_REF]). This assumption is plausible for our analysis where the probability to invest in PPP should not depend on how much time has elapsed since 2004, the starting year of our study. However, we perform a statistical test (stphtest) to assess the PH assumption: we first implement a PH global test that controls for all covariates simultaneously; then, we graphically test the PH assumption for the budget constraint regressors. The main regression for the Cox-Ph model is as follows:

h(t, x, -) = h 0 (t)f (x, -) (1)
where h 0 (t) is proportional to the survivor time, while f (x, -) characterizes how the hazard function changes as a function of our covariates.

The strategy's second method consists of implementing a full parametric model where survival time is assumed to follow a known distribution.

We assume the most common Weibull distribution, which is a general distribution based on two parameters that can be reduced to an exponential distribution if the hazard is assumed to be constant over time. The hazard rate function that we are going to estimate through this method is given in the following expression:

h(t, x, -, ⁄) = ⁄t ⁄≠1 (e -0 +-1 x ) ⁄ (2)
We then run a parametric model for each financial restraint proxy. A graphical method for checking the validity of the Weibull distribution is provided by examining the Kaplan-Meier log curves against log survival time. The graph in Figure 3 reports a straight line, thus providing evidence that the distribution of survival times follows a Weibull distribution.

Results and Robustness checks

Results

We first report the results of the computation of the Kaplan-Meier survival curve, S(t), and the Hazard rate function, h(t), in Figure 4. The first graph looks like a step function given the discrete time. Prior to 2005, the survival probability equals to 1; after this year, some municipalities started to invest. At the end of the time period, the probability of investment is approximately 30%. This result reflects the composition of our dataset, which comprises 101 municipalities with PPP and 202 control municipalities that did not implement any PPP. The Hazard rate function highlights the increasing conditional likelihood to invest under PPP up to year 2011. Subsequently, after the application of the new accounting rule, the line shows a downward trend.

Before presenting the main results of the semi-parametric method under the Cox proportional hazard model, the global test lets us argue that the PH assumption is not violated in the implemented models. We further control for whether or not the budget constraint proxies separately respect the PH assumption. Figures 5,6, 7 reports the fitted curves. They appear horizontal, which means that the scaled Schoenfeld residuals are independent with respect to survival time.

Our main results of the Cox proportional hazard model are reported in Table 5. We report both coe cients and hazard ratios in order to obtain a complete interpretation of our results.

The first set of variables reports the political features of the municipality. The EQI index (institutional aspect) is positive but not significant. The coe cient of the dummy female is also positive but also not significant. Finally, among dummies that reflect the political aspects of municipality governments, only the dummy right is significant; thus, when the mayor is from the right side of the political spectrum, the propensity to implement a PPP increases. This result is in line with previous studies on PPP determinants. Among variables that control for the financial side, budget ≠ result it≠1 has a positive impact, while e ects of investment it≠1 and subsidies it≠1 are negative. Nevertheless, none of the covariates significantly a ect the propensity to invest in a PPP. In contrast, financial restraints proxies have a significant impact on the propensity to implement PPPs. First, we observe a positive and significant e ects for debt it≠1 and annual ≠ payment it≠1 on the use of PPPs, and these persist after 2011. 19 Debt positively impacts the hazard ratio by 18% before 2011 and 14% after 2011, while the e ect of the annual payment is 31% before the application of the rule and 26% after the new legislation. While the rule was found to have a negative e ect, this e ect alone was never significant. As a consequence, we can conclude that municipalities have not used PPPs to minimize debts, at either the stock or flow level. Second, for the proxy self ≠ f inance it≠1 (which captures the municipality's self-financing capacity), the rule's e ect becomes significantly positive (a 6.7% increase in the probability that PPPs will be used). This change may be explained by a shift in French municipalities' behavior. Before 2011, for a given level of debt, the availability of resources for further investment did not a ect the propensity to implement a PPP. After the introduction of the rule, a municipality showed a higher tendency to use PPPs only when its budget is balanced, a trait which in itself represents a high self-financing capacity.

Results of the full parametric model where survival time is assumed to follow a known distribution are substantially equal to the ones of the Cox proportional Hazard model (Table 6). Indeed, we still found that the levels of debt and annual payments increase the probability of PPP use. These e ects remain positive and significant after 2011, while the interaction term is not significant. We also found a similar result regarding municipalities' self-financing capacity. The interaction term rule ≠ self ≠ f inance a ects positively the use of PPPs. This highlights how the presence of internal resources became a significant argument in favor of PPP investment, essentially after 2011.

Robustness checks

We performed various robustness checks to assess the sensitivity of our results. These are discussed below and results are reported at the end of the paper.

Matching strategy and Time periods issues

We have already show how the treated and control groups are similar not only with respect to the matching variables, but also by controlling for population characteristics related to the 2000 -2009 time period. We include, as an additional test, all matching variables in our duration regressions. Our results are not substantially a ected.

A further source of uncertainty remains in the interpretation of the interaction term between the accounting rule and financial restraint proxy. In fact, the policy's impact can be anticipated or identified with hindsight by public actors. We therefore place the rule at di erent years only found non-significant impacts. Furthermore, external factors could exist that influence the trend of the budget constraint proxy but which are also correlated with the PPP dependent variables. An example would be a financial crisis that could make a PPP investment more costly for the public buyer, especially when the latter is constrained in terms of total available resources [START_REF] Marty | Public-private-partnerships under financial crisis: Value for money versus a ordability[END_REF]). This e ect could overemphasize the rule's potential impact; therefore we would be potentially overestimating the extent of debt hiding motivations and underestimating the relevance of alternative channels.

However, to control for the validity of our strategy, we further apply our duration analyses to the entire population of 36,000 French municipalities using our matching variables as controls. Results of the level of debt and annual payment for debt are not substantially a ected, while the e ect of the self-financing capacity of municipalities became non-significant after 2011 (Table 7).

Panel strategy

We propose an alternative empirical strategy in order to check whether or not our results depend on the adopted specification. We choose to implement a panel strategy with a nonlinear model, where the dependent variable is a dummy that equals 1 if municipality i invests under a PPP during year t. Applying a fixed-e ect estimation with a nonlinear model can be problematic. In fact, first di erencing or use within a transformation does not permit elimination of unobserved heterogeneity. Moreover, attempts to add municipality or time dummy variables to the logit or probit estimations will result in biased estimators due to the incidental parameters problem unless the time period is very large. A possible solution to this problem may come from using the traditional Random E ect Probit. This strategy is appealing, but assumes that the unobserved components are strictly exogenous and thus independent from our covariates. An alternative approach would be the Mundlack estimation, which assumes an explicit function for the latent variable. This method allows correlation between random e ects and regressors and thus permits the marginal e ects to be calculated. It can be applied to our full sample and consists of computing a random e ect logit or probit estimation including the average value over time for each of our regressor municipalities. In this paper, we first estimate a simple OLS regression with clustered standard errors (by municipality). Results are reported in Table 8 in the Appendix. Subsequently, we implement the Random logit and the Mundlack Random logit approaches. Results are reported in Tables 9 and10. 20 . Results in Tables 8 and9 do not substantially change with respect to the duration analysis. As in the previous regressions, budget constraint e ects are relevant both before and after the rule's application. The new accounting law a ects the impact of the self-financing proxy as well as the relevance of new debt taken out at time t ≠ 1. When the Mundlack approach is followed (Table 10), although results for the level of annual payment and self-financing capacity stay the same, those for debt level become non-significant for the two periods. Debt level has therefore no impact on the use of PPPs.

Endogeneity problems Finally, we try to eliminate the debt endogeneity problem by substituting our financial constraints with their values in 2004 (before the period of interest). Results are reported in Table 11 (duration models). Results are not substantially a ected apart from the impact of municipalities' self-financing capacity, which is negative both before and after 2011.

Discussion

In this paper, we found di erent results demonstrating the impact of financial restraint on the use of PPPs. We also find evidence regarding the persistence of this impact even when o balance sheet accounting was no longer possible. As a consequence, the debt hiding motivation can be considered not relevant when French mayors make a decision whether or not to use a PPP as an organizational form for public investments.

However, we find that the Decree shows its e ciency in several ways. First, as shown by the Hazard rate function, the conditional probability of a municipality choosing a PPP increased up through 2011. Subsequently, after the application of the new accounting rule, the line shows a downward trend. [START_REF] Klien | Public-private-partnerships in france: Who, why and why not? Workingpaper[END_REF] found a similar trend after 2011 for PPP projects under the preliminary assessment phase. We can therefore consider that mayors pay more attention to the use of PPPs when there is no debt hiding possibility. Second, our results also show that the rule partially changed the relevance of financial restraint in explaining the propensity to choose PPPs as an organizational choice. Indeed, the impact of each municipality's self-financing capacity shows a change in the reasons behind that municipality's investment choice. Before the rule's application in 2011, the presence of internal resources was not a determinant of PPP investment. Afterwards, a strict relation between an investment and balanced accounts was created, making a municipality's investment decision become directly a ected by the balanced budget requirements. We can then conclude that even if a PPP's accounting advantage is not the only driver of this organizational choice, the 2011 20. Tables report direct marginal e ects.

Decree helped improving municipalities' attentiveness regarding their financial situation before they made an investment decision.

Our main results show that municipalities facing a situation of financial restraint choose PPPs for other reasons than the accounting advantage that normally characterizes this organizational type. Some explanations for our results can be discussed. The first argument focuses on the financial dimension. Governments can face temporary liquidity constraints. In such a case, the upfront spending required by traditional procurement can become more expensive than the future transfers required by PPPs because the distortionary cost of taxation is higher now than in the future [START_REF] Engel | The basic public finance of public-private partnerships[END_REF]). This benefit holds unless the planner can decide to optimally postpone the project [START_REF] Engel | The basic public finance of public-private partnerships[END_REF]) or traditional procurement repayment systems can be delayed by mimicking the timing allowed under PPPs.21 Second, from an e ciency point of view, the introduction of asymmetric information can tilt the choice towards the PPP model over the traditional procurement by giving relevance to the shadow cost of public funds. In fact, through PPPs, governments can entrust the project to better-informed agents (the private operator) and a better controller (the lending bank) [START_REF] Auriol | A theory of bot concession contracts[END_REF]). Under such an organizational choice, governments can also save incentive rents thanks to the private agent's long-term involvement [START_REF] Buso | Public and private finance of PPPs[END_REF]). Third, as demand factors and institutional constraints are the main drivers of the debt levels rather than governments' capacity to finance [START_REF] Bahl | State and local debt burdens in the 1980s: A study in contrast[END_REF]), public actors might pay less attention to their debt burden levels. Moreover, even if we control for some political dimensions, other political channels may exist that can explain our results. For example, [START_REF] Maskin | Public-private partnerships and government spending limits[END_REF] find that under a context with high lobbying, it is easier for a government that uses PPPs to favor some operators. Finally, we can also argue that even after introduction of the 2011 rule, debt hiding motivations could persist. This explanation should not be particularly relevant given the e ectiveness of the French Decree in ruling out accounting advantages (see Section 2 which discusses the French institutional context).

Conclusions

In this paper, we first study whether or not a public authority burdened by a hard budget constraint is more likely to choose PPPs. Second, we examine the nature of this e ect, i.e., is it made only out of a debt-hiding motivation? We find that a budget constraint is associated with higher use of PPPs. However, while the new accounting rule enacted in 2011 might have significantly changed the temptation for municipalities to hide debt and consequentially decrease the impact of financial pressure when employing a PPP investment, the budget constraint e ect continues to be positive and significant for some financial constraint proxies. We therefore conclude that debt hiding is not the only motivation when financially stressed municipalities choose PPPs as an organizational form.

Our empirical results contribute to the literature in several ways. First, we corroborate the traditional view in Public Administration literature. Indeed, as we do not find evidence for creative accounting adoption when financially constrained French mayors make their organizational choices, our results support the idea that public managers' motivations are to serve the public interest, instigate social change, and shape policies that a ect society (e.g., [START_REF] Frederickson | The public service and the patriotism of benevolence[END_REF], [START_REF] Perry | Factors a ecting the context for motivation in public organizations1[END_REF], [START_REF] Perry | The motivational bases of public service[END_REF]). Second, we contribute to the PFM literature as we found that a large debt burden level is not necessarily connected with a strategy of o oading debt. This is an interesting result in the context of a financial crisis, where governments around the world are forced to cut budgets, restructure service delivery strategies, reset priorities, and assume enormous new financial responsibilities [START_REF] Kioko | Why public financial management matters[END_REF]). Third, we point out how PFM's concerns can contribute to PAM core questions such as decision making, performance management, and organizational strategy. Finally and more narrowly, we contribute to the existing literature on PPPs. Our results do not only detect the e ect of budget constraints on the use of PPPs, but also look at the possible motivations that induce constrained public authorities to choose this organizational form. This paper is, to the best of our knowledge, the first direct empirical analysis of this topic.

From a practical point of view, our paper has also several managerial implications. First, our results provide more insight to regulation instances such as the MaPPP. Indeed, the non-relevance of debt hiding motivations is an argument to continue developing the PPP organizational form. Moreover, the impact of the 2011 French Decree on more balanced consideration made by public actors before choosing a PPP may help these instances in improving PPPs' institutional framework in the future. Second, our results might also make public actors who are tempted to use PPPs for financial motivations to reconsider this organizational choice. Third, our study may help private actors and private lenders in their deliberations regarding the possibility of collaborating with the public sector. Indeed, knowing that public managers are not choosing PPPs for debt hiding motivations may encourage the private sector to financially participate in such a strategy. Finally, our results have "solved" the myth about PPPs' motivation among practitioners. Our results can also partially explain why countries have increasingly turned to PPPs in recent years despite all these criticisms. In fact, a 2009 OECD report stated that PPPs have grown to comprise a portion, although not the majority, of capital budgets in several countries. 22 . This evolution experienced a temporary decline during the current economic crisis [START_REF] Epec | France: PPP units and related institutional framework[END_REF]), however, the long-term trend is expected to become positive [START_REF] Wagenvoort | Infrastructure finance in europe: Composition, evolution and crisis impact[END_REF]). Our research addresses a very relevant problem in the current situation In these regressions are furtherly included as covariates: population, income, n. of firm and, for the Parametric Survival Model, the trend_rule variable (that is significant)

All budget covariates are computed as di erence with the reference group.

  Figures 1 and 2 describe PPP trends at the French municipal level since 2005. The number of PPPs has remained stable from 2007 to 2010, then increased considerably since 2011, before finally slowing down in 2013. Regarding the cumulative amount of projects, i.e., the value of the projects' capital investment, it increased through 2008, then dropped in 2009, rose again in 2010, and finally fell in 2012. Although we observe a slow recovery in 2013, the reduced number 11. The other two levels of public administration have concluded 37 PPP projects.

Figure 1 :

 1 Figure 1: PPP trend in France: Number of projects at the municipal level

Figure 2 :

 2 Figure 2: PPP trend in France: Cumulative amount of projects at the municipal level

Figure 3 :

 3 Figure 3: Kaplan -Meier Survival Estimate

Figure 5 :

 5 Figure 5: PH Tests for Financial constraints covariates: Debt and Rule*Debt

Figure 7 :

 7 Figure 7: PH Tests for Financial constraints covariates: Self_finance and Rule*Self_finance

  In these regressions are furtherly included as covariates: population, income, n. of firm. All budget covariates are computed as di erence with the reference group.

  In these regressions are furtherly included as covariates all the matching variables

Table 1 :

 1 Panel Dataset DescriptionReported value is the means in million euro over the period2003 -2012

		Treated	Control
		101 obs	202 obs
	P P P ≠ amount	32,3	0
	Annual ≠ Investment	26,2	29,9
	Operation ≠ result	4,8	5,5
	Overall ≠ result	4,7	5,9
	Debt	63,6	45,2
	Annual ≠ debt ≠ payment	9,3	5,6
	Subsidies	24,4	21,6

Table 2 :

 2 PS Test

	Variable	Treated Control	%bias	t	p>t
	population_2009	35367	25448	12.5	1.35	0.181
	population_1999	33663	24598	12.1	1.28	0.202
	area	28626	31886	-3.1	-0.47	0.638
	population_2009_men	16976	11728	14.2	1.38	0.169
	accomodations_2009	19662	14281	12.9	1.25	0.213
	main_residences_2009	16976	11728	14.2	1.38	0.169
	second_residences_2009	1240.9	1517.9	-7.2	-0.43	0.667
	vacant_accomodations_2009	1444.6	1034.6	11.8	1.24	0.217
	owned_residences_2009	6965.3	5266.6	10.9	1.24	0.216
	income_2009	4.7e+08	3.3e+08	13.0	1.32	0.189
	taxpayers_2009	20678	14983	12.2	1.32	0.190
	workers_2009	20195	14291	15.8	1.25	0.215
	long_term_workers_2009	18327	13000	15.9	1.23	0.222
	workers_1999	17857	12670	15.6	1.22	0.223
	population_15-64_2009	23938	16610	14.0	1.41	0.159
	unemployed_15-64_2009	2419	1658.1	13.3	1.43	0.155
	employed_15-64_2009	16637	11732	14.0	1.38	0.169
	total_firms_2010	3471.8	2432.9	12.8	1.34	0.181
	agriculture_firms_2010	46.94	37.58	15.8	0.93	0.354
	industry_firms_2010	155.95	118.12	11.6	1.25	0.214
	construction_firms_2010	241.12	194.08	6.6	0.94	0.346
	services_firms_2010	2466	1717.9	13.1	1.31	0.192
	trade_firms_2010	702.65	536.27	10.7	1.09	0.279
	public_firms	561.76	365.2	14.3	1.52	0.131
	SMEs	998.84	706.87	13.7	1.34	0.183
	No_SMEs	268.11	196.87	14.4	1.19	0.235

Table 3 :

 3 PS Test pre 2009

	Variable	Treated Control	% bias	t	p>t
	taxpayers_08	26544	23728	3.3	0.24	0.808
	net_income_08	5.8e+08	6.4e+08	-2.3	-0.16 0.874
	total_tax_08	3.4e+07	5.5e+07	-6.1	-0.42 0.673
	taxable_income_08	4.7e+08	5.5e+08	-3.2	-0.23 0.821
	notaxable_income_08	1.1e+08	9.2e+07	6.6	0.51	0.611
	taxpayers_07	26398	23598	3.3	0.24	0.808
	net_income_07	5.7e+08	6.3e+08	-2.4	-0.17 0.867
	total_tax_07	3.7e+07	5.9e+07	-6.0	-0.42 0.678
	taxable_income_07	4.6e+08	5.5e+08	-3.3	-0.23 0.818
	notaxable_income_07	1.0e+08	8.5e+07	7.0	0.54	0.591
	taxpayers_06	26198	23445	3.3	0.24	0.810
	net_income_06	5.4e+08	6.0e+08	-2.3	-0.16 0.873
	total_tax_06	3.5e+07	5.5e+07	-6.0	-0.41 0.680
	taxable_income_06	4.4e+08	5.2e+08	-3.2	-0.23 0.821
	notaxable_income_06	1.0e+08	8.6e+07	6.7	0.51	0.610
	taxpayers_05	25780	23239	3.0	0.22	0.823
	net_income_05	4.2e+08	4.7e+08	-2.4	-0.17 0.864
	taxpayers_04	25755	23259	3.0	0.22	0.827
	net_income_04	4.1e+08	4.6e+08	-2.6	-0.18 0.856
	taxpayers_03	25594	23261	2.8	0.20	0.839
	net_income_03	4.0e+08	4.5e+08	-2.6	-0.18 0.854
	taxpayers_02	25277	23001	2.7	0.20	0.841
	net_income_02	3.8e+08	4.3e+08	-2.6	-0.18 0.855
	taxpayers_01	24883	22830	2.5	0.18	0.855
	net_income_01	3.6e+08	4.2e+08	-3.1	-0.22 0.826
	taxpayers_00	24514	22288	2.8	0.20	0.840
	net_income_00	3.5e+08	4.1e+08	-3.0	-0.21 0.833
	taxpayers_99	24184	22021	2.7	0.20	0.843
	net_income_99	3.4e+08	3.9e+08	-3.0	-0.21 0.834
	taxpayers_98	23890	21870	2.6	0.19	0.852
	net_income_98	2.1e+09	2.4e+09	-2.8	-0.19 0.846

Table 4 :

 4 Definition of variables and expected result

	DEFINITION
	VARIABLE
	DIMENSION

Table 5 :

 5 Duration estimation: Cox PH ModelIn these regressions are furtherly included as covariates: population, income, n. of firm. All budget covariates are computed as di erence with the reference group.

	(6)	hazard ratio	1.009	(0.02)	1.002	(0.01)	0.941	(-0.24)	0.658	(-0.40)	1.939**	(2.46)	0.969	(-1.59)	1.006	(0.13)	0.913	(-1.51)	1.169***	(2.81)					1.012	(0.50)	1.053	(1.44)	2395	1.067**	2 . 0 7 2
		coe .	0.00887	(0.02)	0.00228	(0.01)	-0.0605	(-0.24)	-0.418	(-0.40)	0.662**	(2.46)	-0.0313	(-1.59)	0.00563	(0.13)	-0.0910	(-1.51)	0.156***	(2.81)					0.0124	(0.50)	0.0520	(1.44)	2395	0.0644**	2 . 0 7 2
	(5)	hazard ratio	1.028	(0.07)	1.018	(0.05)	0.937	(-0.26)	0.668	(-0.38)	1.936**	(2.46)	0.970	(-1.53)	1.002	(0.06)	0.917	(-1.44)	1.167***	(2.79)					1.035*	(1.65)			2395			11.72	0.6290
		coe .	0.0273	(0.07)	0.0182	(0.05)	-0.0653	(-0.26)	-0.404	(-0.38)	0.660**	(2.46)	-0.0301	(-1.53)	0.00243	(0.06)	-0.0862	(-1.44)	0.154***	(2.79)					0.0340*	(1.65)			2395			11.63	0.5584
	(4)	hazard ratio	1.095	(0.23)	1.048	(0.13)	0.914	(-0.36)	0.723	(-0.31)	1.814**	(2.21)	0.982	(-0.98)	1.000	(0.01)	0.907	(-1.57)				1.310***	(2.85)	0.960	(-0.60)				2395	1.258***	2 . 7 1 0
		coe .	0.0912	(0.23)	0.0472	(0.13)	-0.0899	(-0.36)	-0.325	(-0.31)	0.596**	(2.21)	-0.0183	(-0.98)	0.000239	(0.01)	-0.0976	(-1.57)				0.270***	(2.85)	-0.0408	(-0.60)				2395	0.229***	2 . 7 1 0
	(3)	hazard ratio	1.090	(0.22)	1.047	(0.13)	0.912	(-0.36)	0.722	(-0.31)	1.827**	(2.24)	0.982	(-0.98)	1.001	(0.01)	0.905	(-1.60)				1.277***	(2.98)						2395			9.40	0.7418
		coe .	0.0866	(0.22)	0.0463	(0.13)	-0.0916	(-0.36)	-0.326	(-0.31)	0.603**	(2.24)	-0.0182	(-0.98)	0.000583	(0.01)	-0.0993	(-1.60)				0.244***	(2.98)						2395			9.93	0.6225
	(2)	hazard ratio	1.116	(0.28)	1.058	(0.16)	0.930	(-0.29)	0.726	(-0.31)	1.894**	(2.38)	0.982	(-0.96)	0.999	(-0.02)	0.935	(-1.13)	1.180**	(2.40)	0.966	(-0.61)							2395	1.141***	2 . 3 1 6
		coe .	0.110	(0.28)	0.0561	(0.16)	-0.0729	(-0.29)	-0.320	(-0.31)	0.639**	(2.38)	-0.0178	(-0.96)	-0.000980	(-0.02)	-0.0671	(-1.13)	0.166**	(2.40)	-0.0343	(-0.61)							2395	0.132***	2 . 3 1 6
	(1)	hazard ratio	1.113	(0.28)	1.057	(0.16)	0.930	(-0.29)	0.726	(-0.31)	1.910**	(2.41)	0.982	(-0.95)	0.999	(-0.02)	0.935	(-1.14)	1.153***	(2.59)									2395			10.54	0.5691	0.01
		coe .	EQI 0.107	(0.28)	female 0.0556	(0.16)	left -0.0731	(-0.29)	center -0.321	(-0.31)	right 0.647**	(2.41)	budget_result -0.0177	(-0.95)	grant -0.000676	(-0.02)	investment -0.0676	(-1.14)	debt 0.142***	(2.59)	rule_debt	annuity		rule_annual-payment	self-finance		rule_self-finance		N 2395	post2011	t	PH gl. test (chi2) 9.40	p value 0.7417	t statistics in parentheses	* p < 0.10 , ** p < 0.05 , *** p <

Table 6 :

 6 Parametric Survival Model

	(6)	hazard ratio	1.022	(0.06)	1.006
		coe .	0.0213	(0.06)	0.00556
	(5)	hazard ratio	1.041	(0.11)	1.026	(0.07)
		coe .	0.0406	(0.11)	0.0253	(0.07)
	(4)	hazard ratio	1.120	(0.29)	1.058	(0.16)
		coe .	0.114	(0.29)	0.0568	(0.16)
	(3)	hazard ratio	1.127	(0.31)	1.061	(0.17)
		coe .	0.120	(0.31)	0.0591	(0.17)
	(2)	hazard ratio	1.135	(0.33)	1.061	(0.17)
		coe .	0.126	(0.33)	0.0588	(0.17)
	(1)	hazard ratio	1.137	(0.33)	1.063	(0.17)
		coe .	0.128	(0.33)	0.0607	(0.17)
			EQI		female

Table 7 :

 7 Duration estimation: all municipalities

Table 8 :

 8 OLS cluster estimation p < 0.10 , ** p < 0.05 , *** p < 0.01 In these regressions are included as covariates: population, income, n. of firm and year dummies All budget covariates are computed as di erence with the reference group.

		(1)	(2)	(3)	(4)	(5)	(6)
		treatment	treatment	treatment	treatment	treatment	treatment
	EQI	0.0816	0.0834	0.0532	0.0578	0.0370	0.0315
		(0.26)	(0.26)	(0.17)	(0.18)	(0.12)	(0.10)
	female	0.000359	0.000932	-0.00538	-0.00491	-0.0146	-0.0238
		(0.00)	(0.00)	(-0.02)	(-0.02)	(-0.05)	(-0.08)
	left	-0.0447	-0.0446	-0.0593	-0.0568	-0.0400	-0.0301
		(-0.20)	(-0.20)	(-0.27)	(-0.26)	(-0.18)	(-0.14)
	center	-0.586	-0.581	-0.618	-0.612	-0.623	-0.637
		(-0.55)	(-0.54)	(-0.59)	(-0.59)	(-0.57)	(-0.59)
	right	0.540**	0.531**	0.503**	0.495**	0.546**	0.540**
		(2.31)	(2.26)	(2.15)	(2.11)	(2.31)	(2.27)
	budget_result	-0.0187	-0.0187	-0.0198	-0.0198	-0.0266	-0.0275
		(-0.94)	(-0.95)	(-1.00)	(-1.00)	(-1.27)	(-1.33)
	grant	0.000113	-0.000348	0.00142	0.000902	0.00161	0.00457
		(0.00)	(-0.01)	(0.03)	(0.02)	(0.03)	(0.10)
	investment	-0.0617	-0.0608	-0.0949**	-0.0920**	-0.0742*	-0.0810*
		(-1.37)	(-1.36)	(-2.09)	(-2.05)	(-1.65)	(-1.74)
	trend_rule	-0.959**	-0.958**	-0.970**	-0.970**	-0.960**	-0.958**
		(-2.29)	(-2.29)	(-2.31)	(-2.31)	(-2.30)	(-2.29)
	debt	0.136***	0.172**			0.142***	0.145***
		(3.32)	(2.36)			(3.39)	(3.35)
	rule_debt		-0.0539
			(-0.78)
	annual-payment			0.242***	0.282***
				(3.96)	(3.03)
	rule_annual-payment				-0.0649
					(-0.79)
	self-finance					0.0216	-0.00524
						(1.24)	(-0.22)
	rule_self-finance						0.0679*
							(1.96)
	_cons	9.129*	9.214*	9.328*	9.408*	9.883*	9.813*
		(1.72)	(1.74)	(1.74)	(1.76)	(1.84)	(1.83)
	N	2658	2658	2658	2658	2658	2658
	post2011		0.118***		0.217***		0.0627**
	t		2 . 8 6 2		3 . 5 5 9		2 . 3 9 9
	t statistics in parentheses

*

Table 9 :

 9 Random Logit Estimation p < 0.10 , ** p < 0.05 , *** p < 0.01 In these regressions are included as covariates: population, income, n. of firm and year dummies All budget covariates are computed as di erence with the reference group.

		(1)	(2)	(3)	(4)	(5)	(6)
		treatment	treatment	treatment	treatment	treatment	treatment
	EQI	0.0816	0.0834	0.0532	0.0578	0.0370	0.0315
		(0.20)	(0.20)	(0.13)	(0.14)	(0.09)	(0.08)
	female	0.000352	0.000924	-0.00539	-0.00491	-0.0146	-0.0238
		(0.00)	(0.00)	(-0.01)	(-0.01)	(-0.04)	(-0.06)
	left	-0.0447	-0.0446	-0.0593	-0.0568	-0.0400	-0.0301
		(-0.17)	(-0.17)	(-0.23)	(-0.22)	(-0.15)	(-0.12)
	center	-0.586	-0.581	-0.618	-0.612	-0.623	-0.637
		(-0.55)	(-0.55)	(-0.58)	(-0.58)	(-0.59)	(-0.60)
	right	0.540**	0.531*	0.503*	0.495*	0.546**	0.540*
		(1.97)	(1.93)	(1.83)	(1.80)	(1.98)	(1.96)
	budget_result	-0.0187	-0.0187	-0.0198	-0.0198	-0.0266	-0.0275
		(-0.97)	(-0.97)	(-1.02)	(-1.02)	(-1.30)	(-1.34)
	grant	0.000113	-0.000349	0.00142	0.000902	0.00161	0.00457
		(0.00)	(-0.01)	(0.03)	(0.02)	(0.04)	(0.10)
	investment	-0.0617	-0.0608	-0.0949	-0.0920	-0.0742	-0.0810
		(-1.01)	(-0.99)	(-1.50)	(-1.44)	(-1.21)	(-1.30)
	trend_rule	-0.959**	-0.958**	-0.970**	-0.970**	-0.960**	-0.958**
		(-2.36)	(-2.36)	(-2.39)	(-2.39)	(-2.36)	(-2.35)
	debt	0.136**	0.172**			0.142**	0.145**
		(2.42)	(2.39)			(2.53)	(2.55)
	rule_debt		-0.0539
			(-0.93)
	annual-payment			0.242***	0.282***
				(2.88)	(2.88)
	rule_annual-payment				-0.0649
					(-0.92)
	self-finance					0.0216	-0.00524
						(1.12)	(-0.23)
	rule_self-finance						0.0679*
							(1.88)
	_cons	9.129	9.214*	9.328*	9.408*	9.883*	9.813*
		(1.64)	(1.65)	(1.66)	(1.67)	(1.77)	(1.75)
	N	2953	2953	2953	2953	2953	2953
	post2011		0.118**		0.217**		0.0627**
	t		2 . 0 3 2		2 . 5 0 0		2 . 0 1 6
	t statistics in parentheses

*

Table 10 :

 10 Chamberlain's Random Logit Estimation p < 0.10 , ** p < 0.05 , *** p < 0.01 In these regressions are included as covariates: population, income, n. of firm and year dummies All budget covariates are computed as di erence with the reference group.

		(1)	(2)	(3)	(4)	(5)	(6)
	treatment	treatment	treatment	treatment	treatment	treatment
	EQI	-0.0749	-0.0706	0.0358	0.0439	0.0584	0.0290
		(-0.19)	(-0.18)	(0.09)	(0.11)	(0.15)	(0.07)
	female	0.131	0.136	0.0337	0.0391	-0.0541	-0.0344
		(0.33)	(0.34)	(0.08)	(0.10)	(-0.14)	(-0.09)
	left	-0.294	-0.285	-0.274	-0.277	0.0293	0.0178
		(-1.09)	(-1.06)	(-1.00)	(-1.01)	(0.11)	(0.07)
	center	-0.122	-0.0974	-0.221	-0.228	-0.673	-0.623
		(-0.11)	(-0.08)	(-0.19)	(-0.20)	(-0.63)	(-0.58)
	right	0.531*	0.527*	0.422	0.407	0.569**	0.552**
		(1.82)	(1.81)	(1.40)	(1.34)	(2.05)	(1.98)
	budget_result	-0.0112	-0.0112	-0.0108	-0.0110	-0.0206	-0.0212
		(-0.50)	(-0.50)	(-0.48)	(-0.49)	(-0.97)	(-0.99)
	grant	0.0105	0.0112	0.00121	0.00173	-0.00977	-0.000356
		(0.19)	(0.21)	(0.02)	(0.03)	(-0.20)	(-0.01)
	investment	-0.0436	-0.0471	-0.0731	-0.0751	-0.0255	-0.0301
		(-0.58)	(-0.62)	(-0.90)	(-0.92)	(-0.36)	(-0.42)
	trend_rule	0.759	0.733	0.769	0.754	-0.955**	-0.959**
		(1.47)	(1.42)	(1.48)	(1.45)	(-2.34)	(-2.34)
	debt	0.120	0.170			0.0998	0.106
		(1.34)	(1.53)			(1.34)	(1.09)
	rule_debt		-0.108
			(-0.79)
	annual-payment			0.308***	0.315**
				(2.66)	(2.48)
	rule_annual-payment				-0.00710
					(-0.09)
	self-finance					0.0400*	-0.00641
						(1.76)	(-0.23)
	rule_self-finance						0.111**
							(2.45)
	_cons	-6.798	-6.698	-7.096	-7.175	6.717	5.960
		(-1.35)	(-1.33)	(-1.37)	(-1.37)	(1.54)	(1.35)
	N	2103	2103	2103	2103	2953	2953
	post2011		0.0622		0.308**		0.104***
	t		0 . 5 7 1		2 . 5 6 9		2 . 7 9 7
	t statistics in parentheses

*

Table 11 :

 11 Duration estimation: budget constraint in 2004

We refer to public enterprises as the "hierarchy" model, traditional public procurement as the "market" model, and privatization as the complete private model

PPP are contractual agreements allowing involvement of private sector capital and expertise in the realization and management of an asset that will be returned to the public sector after an adequate period of time (the "bundling" mechanism afterHart [2003a]).

3. The debt corresponding to PPP investment is entered in the public accrual account

For example, the Financial Times reported that in 2002, Goldman Sachs helped Greece raise its o balance sheet finance "by arranging a massive swaps transaction aimed at reducing the cost of financing." The press report explained: Because it was treated as a currency trade rather than a loan, it helped Greece to meet European Union deficit limits while pushing repayments far into the future (Financial Times, Athenian arrangers, February 17, 2010, p7).

One of the first still existant PPP (a ermage) was created at the XIIth century[START_REF] Carpentier | Histoire de France[END_REF]). Moreover, the construction of the Ei el tower in 1887 can be considered the first concession[START_REF] Perrot | Financement des infrastructures et des services collectifs: Le recours au partenariat public-privé: les enseignements des expériences françaises dans le monde[END_REF])

This dataset is available on the INSEE website.

These financial informationare available on the website www.colloc.bercy.gouv.fr. We collect this information through the Python program. The dataset is therefore available from the authors upon request.

This type of variable is the instrument used to perform the duration analysis presented in the Section 4.3

The notation of financial agencies such as Moody's would be a good measure for a municipality's financial situation. However, this notation is currently not available for all French

E ects after 2011 are reported through the post2011 statistic.

It is also important to highlight how high levels of public debt do not directly imply government liquidity constraints.

The United Kingdom has had the longest experience, with PPPs currently comprising 10% to 15% of the capital budget in recent years. France and Korea have had similar experience, with PPPs comprising 20% and 15% of those countries' capital budgets, respectively. Portugal reported the highest payments for PPPs, representing nearly 28% of the national budget or 9.4% of GDP; projects could eventually comprise up to nearly 20% of GDP[START_REF] Posner | Public-private partnerships: The relevance of budgeting[END_REF])

where resources are scarce and much creativity is needed to incentivize economic growth.