Study On The Subsidy Mechanism Of Urban Public Transportation

Urban public transportation belongs to the urban public utility, and what it provides is public service. Urban public transit enterprises belong to not only producing enterprises but also public-welfare, and their ticket price is subjected to the government regulation, which results in the policy-loss of transit enterprises. The government must subsidize the policy-loss of public transit enterprises in order to maintaining the survival and development of public transit enterprises. In China, under the exiting subsidy mechanism of the urban public transportation, due to the asymmetric information between the government and public transit enterprises, the range of the policy-loss of public transport enterprises is difficult to be defined, in addition,the government does not have a specific assessment index for public transit enterprises which receive subsidies, all of those factors lead that the effect of subsidies is not obvious. Therefore, the design for subsidy mechanism of the urban public transportation is currently the key issue of the development of urban public transportation.Firstly, this article analyzes the necessity of subsidies of urban public transportation and problems which exist in subsidy mechanism. It points out that the game exists between public transport enterprises and the government, and also exits among public transport enterprises. Using the mechanism design theory and game theory, a theoretical analysis of the subsidy mechanism is conducted. It points out that the government must design a reasonable subsidy mechanism. Secondly, this article analyzes the game issue existed in the urban public transportation industry, including the game of "truthful declaration" and "untruthful declaration" among urban public transit enterprises, as well as the game of "declaration" and "review" between the public transit enterprise and the government. It points out that through the implementation of examining and verifying system and strength of incentives and penalties, the government could promote public transit enterprises to take the initiative to declare loss actively and truthfully, and further to improve their operating efficiency and quality of service. Thirdly, based on the above analysis and conclusion, the article establishes a comprehensive model of subsidy mechanism of the urban public transportation, and researches from three sections, including entrance to the industry, industry operating-subsidy and exit from the industry. In the conclusion: through the establishment of the examine system and performance evaluation system of subsidy, the government mediates the enterprises'behavior to make the interests of enterprises and the interests of the society to be integration. Finally, according to the actual situation of China, combining with the operating conditions of the subsidy mechanism model, the article makes measures and proposals for the government to subsidize public transit enterprises.