Research On Risk Allocation Of Infrastructure PPP Mode Based On Game Theory

With the process of China's new urbanization and "Belt and Road",we are faced with a sharp increase of demand for infrastructure construction such as water,electricity,environment pollution,traffic,education,health care and pension service.As a cooperation mode with the idea of "benefit-allocation,risk-allocation" between government and social capital,PPP has become a new mode of innovation input mechanism of public service,which can effectively resolve the debt risk of local government.But PPP projects have various and complex risk factors which exist in the whole life cycle of projects due to the dynamic environment.Therefore,how to conduct risk identification,risk assessment,and risk allocation among government sector,private sector,the operators and other players? How to implement the government's effective regulation of the PPP project risk allocation,find out and redistribute the risk factors which is not considered before or risk factors whose initial allocation proportions are not reasonable,and how to safeguard the public's interest? These are matters that the government and financial institutions focus on.Therefore,in the process of promoting public-private partnership,determining the fair and reasonable risk allocation scheme is crucial to guarantee the quality and interest of infrastructure and public service,is also the premise of ensure successful implementation of PPP projects.This paper is about risk identification,risk evaluation,risk allocation,and government regulation in the risk allocation process of infrastructure PPP projects.Firstly,it combined the theory and practical application situation of PPP mode based on the domestic and overseas literature of PPP projects risk.On the basis of project classification theory,principal-agent theory,stakeholder theory and game theory,it analyzed the feasibility of game theory applied to PPP mode risk allocation from the perspective of stakeholder theory and information asymmetry theory.And it made an analysis of risk allocation experience of PPP and found commonalities and differences through the comparison of PPP's theory and practice in other countries.Principal-agent theory,stakeholder theory,game theory laid a foundation of understanding risk allocation management of PPP mode.Secondly,on the basis of principles of risk allocation mechanism for PPP projects,it considered the factors of influencing risk allocation,such as subjective intention,risk preference and risk bearing capacity of the participants,combining with the risk characteristics of PPP projects.Then it analyzed the relationships among government departments,project companies,engineering companies,suppliers,lenders,intermediary agencies and other main participants.And it put forward the process and scheme of risk allocation for PPP projects.Further it applied grounded theory to the induction and summary about risk allocation of PPP projects,and put forward the suitable risk allocation scheme for infrastructure PPP projects in our country.Thirdly,according to the analysis of risk sources and characteristics from these failure cases of PPP projects at home and abroad,risk factors of PPP projects were divided into three categories as macro,medium and micro level from the perspective of the whole project life cycle.Based on the results of risk identification and construction principles,it combined risk evaluation index system of PPP projects with 11 primary indexes and 35 secondary indexes.It put forward the process and method of risk evaluation of PPP projects in our country through fuzzy analytic hierarchy process(F-AHP)to optimize the risk evaluation,based on Delphi method and expert investigation method.Ranking each risk factor's impact on PPP project can provide a reference for allocation priorities of each risk factor.And this paper put forward effective control and management measures to cope with various risks of PPP projects according to the results of risk identification and evaluation of PPP projects.Fourthly,based on the optimal allocation risk theory,it demonstrated that the Nash equilibrium result of risk allocation between the government and the private sector depended upon risk preference coefficient.It found that some risks were taken by one side and others were shared between two sides.And further it constructed the risk allocation model of PPP projects between the government and the private sectors,considering different sequences of the participants,with the bargaining game theory under incomplete information.The model provided the calculation method of risk allocation proportion of PPP projects.The results showed risk allocation ratios of the government and private sectors are related to the degree of asymmetry and negotiation loss coefficient.In addition,one side that makes an offer first has a relatively "first-mover advantage" in the negotiation of risk allocation between two sides of PPP projects.Finally,based on the perspective of game theory,it analyzed the game process among government,intermediary institutions and private enterprise in regulatory mechanism of PPP projects.It contained the game analysis of the KMRW reputation between government and enterprises,agencies' reported violations and government's diligence check.And it explored how the government can carry on effective regulation of PPP projects' risk allocation and what factors made intermediary institutions and private enterprise provide false information about risk allocation.The results showed that the loss of reputation may cause insufficient momentum of maintaining reputation for private companies,which could lead to ineffectively discover the irrationality of risk allocation and undesirable provision of urban infrastructure to the social public.Therefore the government should establish reputation measurement mechanism,rewards and punishment mechanism,and dynamic compensation mechanism to achieve the purpose of self-discipline and supervision,and make the enterprise get the reasonable profit level,avoid low earnings and report violation.And the higher prior probability of default type of private enterprises is,and the higher probability of report violations of the private enterprises and intermediary agencies is.Government departments shall establish intermediaries' examination system to reduce the illegal probability of intermediary agencies.