IDEAS home Printed from https://ideas.repec.org/a/hin/jnlmpe/6196218.html
   My bibliography  Save this article

Efficiency Analysis of Government Subsidy and Performance Guarantee Policies in Relation to PPP Infrastructure Projects

Author

Listed:
  • Lei Shi
  • Yujia He
  • Masamitsu Onishi
  • Kiyoshi Kobayashi

Abstract

Sustainable operation of public-private partnership (PPP) infrastructure projects that are characterized by considerable external benefits is of vital importance. However, a liquidity shock might trigger an inefficient liquidation of a project by the special purpose vehicle (SPV) and the bank, whose objectives are to maximize the profits generated by the project. This study argues that performance guarantee and subsidy policies implemented by the government play a role in encouraging socially efficient decision-making by the SPV and the bank to ensure the continuation of socially valuable projects. The results show that both government subsidy and performance guarantee policies are effective in avoiding the inefficient liquidation of PPP infrastructure projects when the external benefits are large and certain. However, a performance guarantee policy might lead to inefficient continuation when the external benefits of a project are uncertain. Finally, we discuss the possibility that an integrated policy combining performance guarantees and government subsidies improves the efficiency of a PPP infrastructure project.

Suggested Citation

  • Lei Shi & Yujia He & Masamitsu Onishi & Kiyoshi Kobayashi, 2018. "Efficiency Analysis of Government Subsidy and Performance Guarantee Policies in Relation to PPP Infrastructure Projects," Mathematical Problems in Engineering, Hindawi, vol. 2018, pages 1-11, March.
    • Handle: RePEc:hin:jnlmpe:6196218
    DOI: 10.1155/2018/6196218
    as

    Download full text from publisher

    File URL: http://downloads.hindawi.com/journals/MPE/2018/6196218.pdf
    Download Restriction: no
    File URL: http://downloads.hindawi.com/journals/MPE/2018/6196218.xml
    Download Restriction: no
    File URL: https://libkey.io/10.1155/2018/6196218?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Song, Yanqiu & Shangguan, Lingzhi & Li, Guijun, 2021. "Simulation analysis of flexible concession period contracts in electric vehicle charging infrastructure public-private-partnership (EVCI-PPP) projects based on time-of-use (TOU) charging price strateg," Energy, Elsevier, vol. 228(C).
    2. Zhe Cheng & Huanming Wang & Wei Xiong & Dajian Zhu & Le Cheng, 2021. "Public–private partnership as a driver of sustainable development: toward a conceptual framework of sustainability-oriented PPP," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(1), pages 1043-1063, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hin:jnlmpe:6196218. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Mohamed Abdelhakeem (email available below). General contact details of provider: https://www.hindawi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.