| The urban rail transit will provide ensure and support to accelerate urbanization process and solve traffic jam. Considered the semi-profitability and semi-public properties, the government usually takes the responsibility to plan and design urban transit and make investment decisions. Because of the characteristics of the large amount of investment, long period of construction and vulnerable to uncertainties, the government has to make scientific evaluation according to the properties of the project during the investment decision-making process to ensure the success of project investment.This article, based on the analysis of limitation of the traditional economic evaluation methods, discussed the application of real option in the urban transit investment decision. Firstly, various uncertain factors of urban transit are analyzed, the basic conception and classification of real option is explained. On the basis of comparison between the traditional investment evaluation methods and real option applied in the urban transit projects, it came up with the conclusion that applying real option to the urban transit projects is feasible. Secondly, the types and characteristics of real options that the government may possess in the urban transit investment process are analyzed. The steps and model of applying real option to urban transit investment are built. Based on the B-S model and properties of urban transit, the real option pricing model of investment decision-making is set up. |
