Profit Allocation and Subsidy Mechanism for Public–Private Partnership Toll Road Projects

Jin, Lulu; Zhang, Zhanmin; Song, Jinbo

doi:10.1061/(asce)me.1943-5479.0000766

Cited by 34 publications

(23 citation statements)

References 46 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…The ability to replicate and retain knowledge actively is a critical component of learning, capturing and preserving experiences and good practices, as well as improving mechanisms (Berta et al, 2010). Researchers have confirmed the importance of developing knowledge as a decision-making tool (Jin et al, 2020).…”

Section: Key Risk Indicators In Ppp Contractsmentioning

confidence: 99%

A paradigm shift in risk management in public–private partnership arrangements

2021

View full text Add to dashboard Cite

This research sought to determine how public–private partnership (PPP) arrangements can more efficiently address risk management issues using the example of Mozambique as a case study. Analyses of 15 interviews in this country were conducted using the Gioia methodology. The results indicate that integrating key risk indicators into PPP contracts can improve risk management. These measures have been widely used in company risk management. The indicators can serve as monitoring, reviewing and supervising tools, allowing the integration of external factors into PPP contracts at the right time, which is hard to predict when the contracts are signed. Key risk indicators can capture megatrends, track risk evolution and develop future scenarios throughout the entire lifecycle of contracts, preventing conflicts between partners, contract renegotiations or early contract terminations by facilitating an improved understanding of contracts' current realities. The findings suggest that these measures should be applied by PPP units. The proposed approach encourages originality and empirical research-based improvements of PPP risk management frameworks and provides guidelines for future studies.

show abstract

Section: Key Risk Indicators In Ppp Contractsmentioning

confidence: 99%

A paradigm shift in risk management in public–private partnership arrangements

2021

View full text Add to dashboard Cite

show abstract

“…First, the fact that PPP rail transit projects remain various sources of uncertainty leads to many risks, usually in the form of demand, cost, revenue, or other parameters [24]. Without a rational analysis of such risk, the decision-making of government subsidy is likely to be defective.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Many studies have investigated the demand risks, and a corresponding guarantee mechanism has been set up to share the risk [16,19]. e revenue risk depends critically on the uncertainty of the passenger flow volume [17,[28][29][30][31], toll price [32,33], or combinations of the two [24]. On the other hand, cost risk has been the popular choice for the researchers to study, which originates from the uncertainty of the construction costs [34,35] and maintenance and rehabilitation costs [36].…”

Section: Literature Reviewmentioning

confidence: 99%

“…Subsidies generally include financial and asset subsidies [15]. e financial subsidy is divided into direct financial and indirect supports, such as a guarantee in passenger flow volume [16,17], demand [18], and revenue [19][20][21][22][23][24]. Asset subsidy is divided into tangible asset compensation and the provision of management rights applied to the subway projects in Hong Kong and Shenzhen.…”

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Alternative Model to Determine the Optimal Government Subsidies in Construction Stage of PPP Rail Transit Projects under Dynamic Uncertainties

Zhang

Zhou

2020

Mathematical Problems in Engineering

View full text Add to dashboard Cite

Urban rail transit is a quasioperational project and its net cash inflow can hardly cover the investment expenditure. It is essential to determine an acceptable amount of government subsidy to ensure the financial viability of the PPP projects, so as to encourage the entry of the private partner. The partners involved in PPPs have common interests but conflict regarding the value of government subsidy. Considering the uncertainty characteristic by PPPs and information incompleteness in the decision-making process, this study presents a methodology to calculate the equitable subsidy ratio favored by both participants. This study divides the decision process into two steps. First, this study constructs a financial model and introduces an acceptable range of subsidy ratio by using the Monte Carlo simulation method. Second, this study uses the bargaining game theory to determine a particular subsidy ratio under incomplete information. To verify the applicability of the presented model, the researchers invoke an illustrative example for model validation. This research provides a referential and operational method for the government and private sectors to make government subsidy decisions for quasioperational projects.

show abstract

“…Public-private partnerships (PPPs) have been employed to deliver road infrastructure assets in jurisdictions that lack immediate budget availability and wish to expand and improve their road network without privatizing or renouncing control (Jin et al 2020;Sugawara and Nikaido 2014;Swanson and Sakhrani 2020). In a PPP project, the public sector transfers specific risks and responsibilities to private partners in exchange for proper economic returns (Chung 2016;Demirag et al 2012).…”

Section: Introductionmentioning

confidence: 99%

Inferential Analysis of Road Infrastructure PPP Sponsor Networks

2021

View full text Add to dashboard Cite

In the road infrastructure sector, public-private partnership (PPP) projects involve the implementation of project finance principles through the signing of a long-term contract between the public authority and a group of sponsors assembled in a Special Purpose Vehicle (SPV). However, although PPP sponsors play a very important role in SPV formation, the literature does not provide ample evidence to understand such creation processes. Therefore, this study gains insight into the mechanisms associated with the way PPP sponsors establish relationships among themselves in order to form SPVs. The approach employs social network concepts and Exponential Random Graph Model (ERGM) techniques. The analysis is focused on tie-formation processes in sponsor networks across the bidding and financial close stages of road PPP projects in Canada, Chile, and the US between 1993 and 2019. Results show that, despite some differences in the studied jurisdictions, dyadic (i.e., repeated relationships) and structural (i.e., transitivity) factors are the most influential properties driving bidding consortium and SPV creation procedures. Conclusions indicate that sponsors' behavioral patterns are highly influenced by trust-based mechanisms. Further research is required to continue understanding the role of other PPP players and the effect of the external institutional environment on PPP networks.

show abstract

Profit Allocation and Subsidy Mechanism for Public–Private Partnership Toll Road Projects

Cited by 34 publications

References 46 publications

A paradigm shift in risk management in public–private partnership arrangements

A paradigm shift in risk management in public–private partnership arrangements

Alternative Model to Determine the Optimal Government Subsidies in Construction Stage of PPP Rail Transit Projects under Dynamic Uncertainties

Inferential Analysis of Road Infrastructure PPP Sponsor Networks

Contact Info

Product

Resources

About