Research On The Government's Compensation Mechanism Of Quasi-Profit Infrastructure PPP Projects

In recent years,Public-Private Partnership is gradually being applied to the infrastructure construction in various fields.Statistics show that the total scale of the quasi-profit PPP projects is the largest.That means our government still bears great financial pressure.During the long project construction and operation period,unpredictable accidents may occur and the project income could not cover the huge investment cost.In order to attract private investors,the government provides reasonable compensation as an incentive.However,there are many problems in the PPP project government's compensation practice process.It can not coordinate the differences between the Public's and Private's objectives so that it fails to play the necessary incentive role.The current government's compensation mechanism is inflexible and lacks targeted research on quasi-profit PPP projects.Under this background,this paper proposes a study of the government's compensation mechanism of quasi-profit infrastructure PPP projects.This paper analyzes the types of government's compensation and identifies the stakeholders and various types of risks in quasi-profit PPP projects.The relevant factors affecting the government's compensation are identified.Government's compensation for quasi-profit PPP projects is divided into construction compensation and operation compensation.In this paper,by studying the relationship between the two stages of government's compensation,the government compensation model is constructed in stages.For the construction compensation,this paper analyzes the relationship between the capital structure and compensation mechanism and proposes the optimal capital structure range of quasi-profit PPP projects that meets China's national conditions based on past experience levels and policies issued by our government.It is worth noting that risk factors should be considered in the calculation of the cost of quasi-operating PPP projects and the contribution of each participant to the project is calculated from its cost savings.By using Shapley model to calculate the revenue that each party should distribute,this paper proposes a reasonable quasi-profit PPP project equity structure.For the operation compensation,considering the different combinations of risk preferences of both public and private parties,this paper introduces compensation factor to improve the traditional quasi-profit PPP project compensation mechanism.A public and private Stackelberg game model is built and the game equilibrium is solved.Finally,the feasibility of government compensation model is demonstrated by numerical simulation.A theoretical basis for the establishment of the government compensation mechanism is provided.Through the phased model construction of the government's compensation mechanism,the theoretical research on the government's compensation mechanism of quasi-profit infrastructure PPP projects is improved.Using the phased model can make the government's compensation more flexible and maneuverable,save the initial negotiation cost and effectively attract private investors to invest in the quasi-profit PPP project.