Enterprise Investment In China's PPP Market:The Impact Of Contract Characteristics

In the process of high-speed urbanization,the demand to infrastructure construction demand is increasing dramatically.However,the limited purse of local government has been difficult to meet the huge demand for funds.Most of infrastructure projects are long-construction cycle,hugely-investment commonweal project.Simply relying on government investment not be an option.As an innovative approach for infrastructure construction and public service provision,the PPP can increase efficiency while maximizing public benefits.However,the landing rate of China's PPP projects has been relatively low,and the participation of private capital has continued to be sluggish.Based on a large sample of PPP projects included in the database of China PPP Center,this paper applies Tobit model to explore the impact of contract characteristics on the enterprise investment and reveal whether this impact is affected by regional corruption.The results indicate that total investment,contract duration and contract management difficulty are negatively related to the degree of enterprise investment,while the presence of government payment is positively related to the degree of enterprise investment.High degree of corruption induces the positive impact of total investment on enterprise investment.The investment of private enterprises will increase when contract management difficulty is low and total investment is large in the areas with high degree of corruption.However,these do not help to the investment of state-owned enterprises.From the analysis of contract characteristics,the research has made a clear understanding about participation of social capital in PPP projects,further identified the issues that affect the participation of social capital.On this basis,we put forward some countermeasures from the government levels.Some attention should be given to choosing the payment mechanism to make sure that it adequately accounts for the risk of the project.And it suggests that the government should offer private enterprise some preferential policies to solve their worries,and strengthen the environmental construction of the struggle against corruption so as to promote steady development in China PPP market.