Association for Public Policy Analysis & Management

China’s PPP practice has boomed these years. In the developing countries represented by China, the complementary effect between public and private is not obvious, but the partnership between the government and State-owned enterprise (SOE) exists in large numbers. There are two types of partners in developing countries represented by China, among which the PPP involving SOEs should not be generally regarded as a complementary partnership. This paper focuses on motivation of PPP partner selection by local government. Through a comparative case study, this paper puts forward a partner selection framework of “value synergy and capacity complementarity”, which revealed the duality of partner selection motivations with balancing value and instrumental rationality. The result shows that the combination of value synergy and capacity complementarity reaching a certain threshold will become a sufficient condition which shows limited diversity logic. This study can help to deepen the understanding of the mechanism on how Public-private partnership is committed and how SOE behaves in such context.