Public-Private Partnership: What is The Impact on Local Governance and on Standards of Living?

Public and private entities have recently begun to change their relations with one another. In the past, there has been little cooperation between these sectors, but now public organizations increasingly understand that by cooperating with the private sector, they can improve organizational performance and better achieve social goals (Kooiman, 2003). Public-private collaborations are seen by public organizations as a way to create higher standards of living and update social infrastructures by involving private citizens and their organizations in decision-making processes. These partnerships are widespread in the European Union, where member countries encourage many kinds of organizational cooperation. Due to various European Union decisions and programs, public organizations are able and encouraged to cooperate with private firms. For example, the Leader Program and other similar initiatives have facilitated public-private partnerships, including local action groups (LAGs). These groups promote sustainable local development by deploying resources from a broad range of entities, including public administration, private firms, associations, and citizens. Since public-private partnerships enhance the local community as well as engender innovative approaches to managing, many scholars have studied these partnerships, particularly with regard to the transformation of governance systems (Glendinning et al., 2002). In this paper we focus on this latter aspect, namely, public-private partnerships as the cornerstone of governance transformation. We aim to answer the following question: Can public-private partnerships provide a new model of governance that positively impacts the lives of all citizens? To answer this question, our research is presented in four stages: • We review the literature on governance theory and highlight the development of the public-private partnership model. • We examine the development of local action groups. • We present a case study of the Monte Linas LAG as a successful example of a local partnership that promotes economic and social growth in Sardinia, Italy. • We conclude by using the public-private partnership model to propose a new model of governance, namely, the partnership governance, which is based on our review of existing theory as well as our consideration of LAGs in general and the Monte Linas LAG in particular