Private Finance Initiative in Japan

This dissertation analyzes the Private Finance Initiative (PFI) in Japan. It first introduces the reader to the basics of PFI, a model for rendering public services by utilizing private capital, which has been installed as a successor to the Third-Sector-System. The practice of PFI in Japan is then examined on an empirical basis. Finally, it is analyzed by means of the systems theory of Niklas Luhmann. The analysis points out that organizations which are not specialized on economic communication, especially prefectures and cities in Japan, have difficulties to adapt to PFI. Organizations dominated by the economic system, including the PFI special purpose companies, enjoy a communicative advantage. However, the risk theory of the systems theory also shows that they are faced with a plethora of risks, which cannot be controlled entirely even by the most elaborate contractual arrangements.