Trust in public-private urban regeneration partnerships

Research conducted by Carley Pennink (Head of International Projects at IHS) reveals that trust can influence the risk and outcomes of public-private partnerships, as perceived by partners.

It is vital to invest in building trust between partners, as trust can act as a governing mechanism in situations of high risk and is important in achieving outcomes, including, for instance, the tendency to cooperate, coordination efficiencies and the realization of innovation.

The central question of the research is:

Is there evidence of a trust cycle in partnerships and does trust have an influence on risks and outcomes as perceived by the partner?

A shift in urban policy has taken place in the last decades and this was caused by how complex and interrelated urban issues are. Urban decline has been approached from a more strategic angle, such as urban regeneration, using Public-Private Parnerships as a main instrument.

By analysing three long-term urban regeneration partnerships in Poland, USA and the Netherlands and the process of trust build-up between partners, this research finds evidence that trust is an "iterative" and cyclical process, just like the perception of risks and outcomes.

The results proove that trust is consistently higher among partners that interact intensely, and are essential for the realisation of the project. When there is frequent interaction and the partners depend on each other for outcomes, building trust is important. What also matters is the type of organisation in the partnership, since this can influence the decision making process. A more autonomous organisational structure lacks political interference, allowing partners to focus on the project.

Further conclusions indicate factors that influence the process of trust building. All partners found the knowledge basis of trust to be relevant: sharing of information and resources, as well as predictability and respect for capacity. On the other hand, factors that contribute to the decline in trust are withholding of information or predictability. 

This research adds to the theory of trust, as well as the theory on the relations between trust, risk and outcomes. A key value of this research is that it provides an in-depth analysis of trust over time and charts the dynamics of trust in a trust cycle over time. 

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