# **_4.1.2. Data_**

Data come from four sources, the World Bank Private Participation in Infrastructure Project Database (PPI),<sup>12</sup> the Polity IV Project,<sup>13</sup> World Bank’s World Development Indicators (WDI),<sup>14</sup> and Laeven and Valencia (2018).

The PPI database includes data on project characteristics as they were agreed at the time of the signing of the PPP contract or at the time of financial closure. These characteristics include the type of project, sector, contract period, government level granting the contract, identities of the sponsors, types of government support, amount of investment commitments and financing information. The PPI also provides the current status of the project as active, concluded, distressed or canceled.

A considerable number of projects in the PPI database lack the data for all characteristics. Missing data on the variables essential for the analysis, namely contract period and the level of government which granted the contract, were added for all projects using the individual project descriptions provided in the database if available.

The Polity IV data is used to identify the institutional characteristics of a country. To identify these characteristics, yearly executive recruitment, constraints on the executive and political competition concept variables are used. The values for the interruption, interregnum and transition periods, during which the variables are coded out of their respective ranges in Polity IV, were linearly interpolated.

From the WDI, annual series of per capita growth rate and nominal exchange rates are used to create series of detrended and demeaned series of per capita growth rate and exchange rate shocks using the filter suggested by Hamilton (2018). The data on financial crises come from the Systemic Banking Crises data set of Laeven and Valencia (2018).

The econometric estimation uses the data on all PPP projects in low- and middle-income countries. After estimating equation (3), predicted probabilities of distress are obtained for the PPP projects in South Asia using the predictions implied by the survival analysis. Data limitations preclude estimation using only the South Asian countries.

The PPI database records 7,979 projects in the developing world, encompassing 127 countries, with financial closure dates from 1990 to 2019. The database includes projects from five different sectors: ICT, energy, transport, water and sewerage, and municipal solid waste. Since the municipal solid waste data has been a recent addition to the database, and only covers the currently active projects with financial closures starting in 2009, they were dropped from the sample to make all projects comparable. ICT projects, merchant and rental greenfield projects, management and lease projects, and divestitures were also excluded from the sample because they are not PPPs as this study defines them.

> 12 Version 2019 H1, available at https://ppi.worldbank.org/en/ppidata. 13 Polity IV Project, Political Regime Characteristics and Transitions, 1800-2018, available at <u>http://www.systemicpeace.org/inscrdata.html.</u>

> 14 Available at http://datatopics.worldbank.org/world-development-indicators/.

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