Impact of the ownership form on cost management: A public-private partnership perspective

Abstract

The main motive of this study is to evaluate the adaptation of the form of public-private organization to cost control. The empirical analysis for this research includes time-series data from 2008 to 2019 for the EcoHigjiena company by comparing its costs when it was a publicly owned company with the costs over the time the company entered into the partnership agreement. The findings of the study show that public-private ownership is a critical factor in determining total costs of the company by reducing total costs by 10%. The control variables (such as landfill within the municipality, wages and maintenance costs, number of customers and number of employees) for this study also showed significant and robust relationships in the total costs of the company. Wage expenses are an important indicator in increasing the total costs of the company by increasing them by 1.12%, which means that for every employee in the company, total cost decrease by 0.49%. Disposal costs contribute to a 0.25% increase in total costs. The number of clients is statistically important when viewed from an economic perspective, its impact on total costs is not high, or, in other words, there is no implication because for each client of the company, total expenses increase by 0.002%.

Keywords

• costs
• labor cost
• organization
• partnership
• sustainability