Study On The Causes Of Changes In The Main Body Of China’s Tollway Investment And Financing

The organizational form of the main body of tollway investment and financing in China has undergone many changes,but local governments have been playing a leading role.The tollway debt risk is increasingly prominent,which is related to local government’s improper behavior under improper incentives.Thus,it’s urgent to analyze the changes of tollway investment entities to solve the problems and raise efficiency through new mechanism.Traditional motivation theory of institutional change think that,the market mechanism has formed an incentive to the main body,whom obtained the incentive by promoting institutional change.But from the actual situation of toll way development in China,the central government gives political incentives to local governments through administrative instructions,and the local governments evade the constraints to complete the investment and financing tasks to get incentives through collaborate with different social capital,so the existing analytical framework has obvious limitations in explaining the reality of China.The central government’s incentive to local governments and cooperation between local governments and social capital are the result of the interactive game among different subjects,so the paper has been established analysis frame of relationship between the central government,local government and social capital to analyze the motive of the change of the main body of the investment and financing of the toll roadOn the basis of the analysis of the framework,this paper carry out related research through literature analysis,two level interactive evolutionary game model,the analysis of historical evidence and comparison,and empirical analysis of space measurement,the main conclusion this paper made are:(1)changes in investors in China ’ s tollway industry are mainly caused by two factors:one being the encouragement policies from the central government and the other being the motivation for the cooperation between local governments and social organizations.By investing in tollways to boost regional economy,local governments can gain political support from central government,and at the same time,central government will restrict local governments’ authority and finance power through laws,regulations and tax reform.In order to avoid such restrictions,local governments will cooperate with social organizations to lower cost and make some innovative breakthrough,which in return promotes the development of highway business.Based on the above research contents,the conclusions drawn from the paper are:(1)changes in investors in China’s tollway industry are mainly caused by two factors:one being the encouragement policies from the central government and the other being the motivation for the cooperation between local governments and social organizations;(2)The financing platform and the cooperation of the government and social capital as the main body,debt financing to bank loans as a source of funds is the local government and the central government and the social capital equilibrium solution,and each main body has reached a state of incentive compatibility;(3)Compared with international experience,the reality of our country lies in the fact that the central government has political incentives for investment and construction of local governments,power incentives for debt financing,local governments and commercial banks have double impulse to borrow money;(4)there have been many problems concerning China’s tollway industry due to government’s improper encouragement policies,the lack of liabilities and industrial monopoly;(5)under the influence of the motivation of the change of investment and financing main body,there is a mismatch between supply and demand in China’s toll road industry,specific performance the mismatch of region,capital source,investment construction and operation maintenance,and direct indirect financing.This paper mainly policy recommendations are:(1)The central government shall be in charge of the overall institutional supplier,deciding the main body through project performance auditing to focus on performance rather than investment and to improve efficiency as well as service quality;(2)Keep enhancing franchising policies according to different conditions and resources of various regions to encourage the participation of different social capitals in the construction and operation of tollway;(3)Separate the property right from the management of the prepayment project,absorbing social capitals on its operation with reasonable profit,and the government can settle the debt by collecting rents;(4)Give permission to reasonable adjustment on toll and term of the project,enabling independent management.The main contributions this paper made are:(1)building and improving the mechanism on the causes of changes of investment and financing;(2)expanding the researches on main body problem in the motivation theory of institutional change;(3)pointed out that there is a mismatch between supply and demand in China’s tollway industry;(4)presenting the government accountability system for tollway investment and performance auditing system for government-invested projects.