Research On Government Self-Compliance Mechanism In PPP Project

The acceleration of urbanization has made the shortage of infrastructure in China and the lack of government budgets increasingly prominent.The introduction of market forces to participate in the construction and operation of urban infrastructure has become an inevitable choice to alleviate the government's financial pressure and meet the needs of the public as soon as possible.It is also in line with the need for the transformation of China's government functions from a construction-oriented government to a public service-oriented government.However,currently the enthusiasm for social capital participation is not high mainly because of the potential default risk of the government in PPP projects.This paper analyzes a public-private partnership(PPP)project's case cooperation details under a usual mode,analyzes the potential default risk of the government and its formation mechanism based on the incomplete contract theory,and finally proposes that governments should promote government compliance by constructing the government self-compliance mechanism.The article believes that under the usual mode of cooperation between government and social capital,social capital needs to bear the negotiation risk outside the contractual provisions,the ambiguity risk of contractual clauses and the unequal risk of default costs,which constitutes the main contents of potential default risks of the government.In order to promote the government compliance,this paper proposes to build a government self-compliance mechanism composed of reputation mechanism,“ social capital ”,incentive mechanism and punishment mechanism in the PPP projects based on the case analysis.In order to better play the role of the government's self-compliance mechanism in promoting government compliance,this paper give advice in three aspects: central government,local government and social capital.Thecentral government should improve the evaluation and result application mechanism of PPP projects from the top-level design level,and promote the standardization of PPP projects' contracts on the basis of perfect contract contents;local governments should understand and use the PPP projects correctly and strengthen self-compliance awareness;social capital should strengthen organizational links,and improve the ability together to identify the government potential default risks through information sharing and exchange of experience.