Influence of market structures on concession pricing in Public-Private-Partnership utilities with asymmetric information

Yuan, Jingfeng; Ding, Hongxing; Huang, Zeyuan; Deng, Bin-Chao; Li, Shuai; Huang, Wei

doi:10.1016/j.jup.2020.101162

Cited by 6 publications

(5 citation statements)

References 31 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Additionally, for user paid projects, the payment mechanism of PPP projects with performancebased can also be included to improve the expected objectives of the projects. The government expects to improve social benefits through projects, and the private sector expects to obtain greater benefits in market competition (Yuan et al, 2021), and the benefit is obtained through the public budget composed of the tax from taxpayers and the payment from users.…”

Section: Literature Reviews 1performance-based Payment Structure In P...mentioning

confidence: 99%

Performance-Based Payment Structural Design for Infrastructure PPP Projects

Cao

2023

International Journal of Strategic Property Management

View full text Add to dashboard Cite

The performance-based payment structure has been widely used in infrastructure PPP projects. However, existing research has been absent on the structural unbalance problem of performance-based payment in the current infrastructure PPP projects. This study aims to construct an optimal proportion of the performance-based payment in the total payment, and then design a performance-based payment structure for infrastructure PPP projects. Firstly, the definition of the performance-linked rate is introduced to characterize the proportion of the performance-based payment. Secondly, based on the different objectives of the maximum social benefit and the minimum cost for the public and private sectors, a multi-objective optimization model is constructed to obtain a reasonable value range of the performance-linked rate. Thirdly, the impacts on different parameters in the performance-linked rate are revealed using simulation methods. Finally, the numerical and simulation results show that, for the weak social average ability, the social cost is also high, and a large performance-linked rate should be set. Conversely, when the social average ability is strong, the social average cost is relatively reduced, and a relatively low performance-linked rate should be set. Consequently, the results can guide the contract design in PPP projects.

show abstract

Section: Literature Reviews 1performance-based Payment Structure In P...mentioning

confidence: 99%

Performance-Based Payment Structural Design for Infrastructure PPP Projects

Cao

2023

International Journal of Strategic Property Management

View full text Add to dashboard Cite

show abstract

“…However, most of the SD studies conducted in the PPP literature have neglected some concession factors, such as the capital structure of the PPP agreements and the public subsidies. Hence, investigating the system from a holistic perspective, including significant financial and social components and parameters that significantly impact it, Quantitative approach Opawole et al [38] 12 Concession price System dynamic Xu et al [11,12] 13 Concession price Principal-agent theory Yuan et al [39] Subsidy and Concession Price System dynamic Yuan et al [26] 14 Concession period System dynamic Zhang et al [40] is pertinent to understanding how PPP can improve and sustain socio-economic variables. The SD model for developing PPPs needs to take most of the critical concession components such as the concession period, concession price (user-payment), government subsidy, and the capital structure into account to better examine the system from a socio-economic sustainability perspective.…”

Section: Literature Reviewmentioning

confidence: 99%

Enhancing the decision-making process for public-private partnerships infrastructure projects: a socio-economic system dynamic approach

2022

View full text Add to dashboard Cite

Public-private partnerships (PPP) have many critical socio-economic concession variables that need to be determined during the negotiation of the PPP contracts. However, their determination presents complexities to decision-makers due to these components’ interdependencies. Assessing the dynamic and interdependent relationships between the socio-economic concession components can enhance the development of PPP concessions. System dynamics (SD) techniques have provided a holistic system understanding of several complex structures from a holistic perspective. This paper aims to build a novel socio-economic SD model to facilitate the decision-making process for PPP projects via determining and assessing the adequate concession period, concession price (user-payment), government subsidy, and the capital structure (in the form of equity). A case study for a PPP toll-road project (I-4 Ultimate) is utilized to validate the proposed model’s results. Higher concession prices increased net present value (NPV) levels and PPP effectiveness. Simulation results showed that the variables are interdependent, and a change in the value of one variable will lead to a change in the values of the other variables. The results also showed that the concession price (user-payment) has a major influence on the concession variables. The model proposed in this study gives a holistic perspective of the complex interplay between PPP effectiveness and several socio-economic variables and is potentially valuable in facilitating and enhancing the decision-making process for PPP projects. While many scholarly discussions have been fronted on the use of system dynamics modeling in PPPs, the specific and unique combination of concession variables is the ultimate contribution of this study to the existing body of knowledge.

show abstract

“…The business environment reflects daily average transit ridership, carrying capacity, and property rents at stations [51].…”

Section: Business Environment 152mentioning

confidence: 99%

“…The vertical structure of URT PPP contracts reflects the responsibilities and the possible benefits of each partner [51].…”

Section: Vehicle Structure 93mentioning

confidence: 99%

“…= 101) are the most important concession contract management factor. Specifically, the vertical structure of PPP contracts, which is determined by considering the characteristics of the project and the resource advantages of the government and private sectors, can specify the responsibilities and benefits of each partner [51]. The coding results show that various vertical structures in bundled or unbundled models were adopted in URT PPP projects.…”

Section: Partnership Synergymentioning

confidence: 99%

See 1 more Smart Citation

Identifying Critical Influencing Factors of the Value Creation of Urban Rail Transit PPP Projects in China

Yuan

Liu

et al. 2022

Buildings

Self Cite

View full text Add to dashboard Cite

Value creation is the primary motivation for public-private cooperation. The development of urban rail transit (URT) projects requires heavy investment and abundant construction and management experience. Thus, public-private partnership (PPP) is usually adopted in URT project development to benefit the public and private sectors. However, with the high-quality development of PPP projects, the value creation of URT PPP projects is not only about achieving basic project objectives but also relying on partner synergy to achieve value-added. Based on the extended connotation of value creation, this study intends to systematically identify the influencing factors of value creation of URT PPP projects in China. The grounded theory approach was adopted to deduce the influencing factors of value creation through analyzing the various types of articles related to Chinese URT PPP projects. Resources complementarity among stakeholders, cooperation environment, and partnership synergy were identified as the main influencing factors. Meanwhile, a theoretical model that described how these influencing factors combined to promote value creation during public-private sectors cooperation of URT projects was established. This research helps broaden the understanding of how public and private sectors should cooperate and collaborate in URT projects to realize value maximization and promote the sustainable development of URT PPP projects and provides a model for further empirical examination.

show abstract

Influence of market structures on concession pricing in Public-Private-Partnership utilities with asymmetric information

Cited by 6 publications

References 31 publications

Performance-Based Payment Structural Design for Infrastructure PPP Projects

Performance-Based Payment Structural Design for Infrastructure PPP Projects

Enhancing the decision-making process for public-private partnerships infrastructure projects: a socio-economic system dynamic approach

Identifying Critical Influencing Factors of the Value Creation of Urban Rail Transit PPP Projects in China

Contact Info

Product

Resources

About