Efficiency Study Of PPP Cooperation Mode Between Government And Private Capital

The Public-Private Partnership mode(PPP)as a reform measure,it helps not only government decrease financial expenditure with support of private capital,but also allow private organization,with its professional expertise,to engage in public service while increasing its management and seeking development opportunity.This benefit is favored by both government and private organization.Normally,PPP relative project is featured with long duration lasting 15 to 30 years.It involves industries like energy,transportation,urban facility renewal,water supply,education,etc.As financial deficit continuously increased in local government plus huge need of infrastructure and public service since 2009,PPP mode was created to relieve budge press of government and ensure supply of infrastructure and public service.After implementation of PPP mode relative measures,value-for-Money efficiency evaluation,financial affordability,etc.several measures in 2014,local government started to actively participate in PPP mode.The mode has been sufficiently put into practice but lack of theoretical guidance.It is originated from UK and appeared as PFI(private Finance Initiative),also ‘privately financed activities',cooperation between government and private capital.PPP mode of ours evolves from PFI relative theory and practice while still has differences.PPP mode dedicates theoretically to property right,principal agent,and transaction cost to study its efficiency,risk,and value.PPP mode,as a reform on infrastructure and public service supply,differentiates itself from BOT(building,operation,transfer),PFI(private Finance Initiative),TOT(transfer,operation,transfer)and some other conventional construction modes.So what are the differences between PPP mode and conventional ones? Whether the mode is fit for our current situation? Is the mode much efficient than conventional ones in different industries or under different conditions? The thesis will try to explain the questions above.Based on the goal above,the thesis includes 8 chapters mainly for 6 parts.First is about concepts and theories.It defines PPP mode,efficiency and PPP mode efficiency to lay theoretical foundation,such as PPP mode renegotiation,value-for-money efficiency evaluation,etc.,for further study.Second is theoretical analysis of PPP mode efficiency.Based on basic efficiency mode and considered of different influences factors,it analyzes which of PPP mode from perspectives of input-output and public supply.In traditional financing mode,public department takes charge of operation.In PPP mode,private organization,which aimed at maximize profit,takes the responsibility instead.So the differences between the modes decide different input-output and public supply efficiency.Third is analysis based on efficiency comparing on PPP mode and traditional financing mode.With basic efficiency model,output function and social welfare function will be achieved in this part.Two functions are concluded from construction and operation period of PPP mode project.The process above is to analyze efficiency of PPP mode macroscopically and microscopically.Comparison of PPP mode and the old one,innovation ability separately of public department and private organization,creative economic value and social value,as well as the study of whether effective incentive measures effect operation or not,will prove PPP mode is much efficient than traditional financing mode.Fourth is case analysis of PPP mode efficiency.Since PPP project is usually endurable,most case analysis is periodical-based.As the project continues,individual case analysis could be conducted to further conclude experience and lessons.Based on 3 categories of PPP mode,i.e.public welfare,pre-operational,and operational project,3 cases in Henan Province has been selected in this part,they are infrastructure construction,urban facility retrofit,railway transportation.The cases analysis,along with theoretical analysis,proves PPP mode performs better in practice than the old one,as well as its superiority in both theoretical and practical aspect.The fifth is risk factors analysis of PPP mode.After all PPP mode is brand new and has not been testified in long term.Though it could be used to cope with government financing and operational issues,it is still potentially risky in the future.This part will implement analysis macroscopically and microscopically.Macroscopical aspect includes politics,laws,and marketing.Microsopical aspect will take project recognition phase,partners in risk projects,public acceptance of the project,replace business tax with value-added tax,etc.factors into consideration.The sixth is policy recommendations.According to conclusions from theoretical analysis and case study,this part offers policy recommendations macroscopically and microscopically to promote PPP projects.The innovation pointsare thatthe paper directly focusing on the efficiency research of PPP mode.Theefficiency of PPP mode is compared with the traditional model,and three real cases are selected to verify the superiority of the PPP mode from the micro level,so this will provide a basis for the establishment of the effective mechanism of the PPP model.