Research On Risks Allocation And Guarantee Of Granary Construction PPP Projects Based On Real Option Theory

Granary construction is an important part of infrastructure construction in China,which guarantees our country’s grain storage and supply security.However,China urgently need to increase the construction of grain reserves in the present,because of the insufficient grain warehouse capacity and the dangerously old warehouse etc.The long granary construction cycle leads the government to bearing the huge financial pressure,while the PPP(Public-Private Partnership,public-private partnerships)model can ease the government’s financial pressure.There are many kinds of risks in each stage of the PPP granary construction projects,such as competition.It is very hard for the government and enterprises to clearly define of the project risks at the beginning,so this paper think that the real options theory can effectively deal with project risks in the future.Based on the real options theory,this paper analyzes the PPP granary construction project risks and help the government to determine the reasonable guarantee level,in order that the government and the enterprises realize the risk-sharing and achieve win-win situation in the PPP projects.Thesis mainly studies the advantages of the of PPP granary construction,the real options theory including its mathematical model,the real option identification of project risks,and the pricing models of PPP projects.It sets up a option value model and expects to effectively response to the future PPP operation risks at the beginning.This research finds that using the real option theory can respond to the PPP projects risks.By the real option value model construction,we may safely draw the reasonable guarantee level for government to realize the risk-sharing and achieve win-win situation in the PPP projects for the government and the enterprises.Many PPP granary construction projects risks are from competitions and other factors.This paper expects to providing the PPP granary construction projects with some theories for the reasonable coping-risks styles and the reasonable grain guarantee levels for the government.