A Study On Risk Sharing Of PPP Project Financing In China Based On Game Theory

Public-Private Partnership(PPP)is a long-term partnership between the government and the private sector in order to provide public goods and services more effectively.In recent years,facing the downward pressure of China’s economy,the central government has promulgated various policies to regulate the economy.However,due to the imperfection of the regulatory system,some local governments resort to local financing platforms to borrow heavily and invest blindly,which has laid many hidden dangers to the government debt risk.In view of this,the central government has turned to the emerging financing mode to solve the local government debt crisis,thus the PPP mode has been developed.But at present,PPP mode has just started in our country,the project operation is not mature,and the lack of project risk management can easily lead to project failure.Therefore,how to recognize and effectively share risks among PPP project participants is a key issue to promote the development of PPP model.This paper expounds the concept and characteristics of financing risk in PPP mode,and introduces the participants and the principles of risk sharing at present.Then it introduces the process of risk sharing,summarizes the various risks in three typical failure cases of domestic PPP projects,and constructs a list of 12 policy risks,8 market risks and 16 project-level risks for PPP projects.Summarize the research conclusions of experts,sort out the consensus and controversy of the initial risk sharing,analyze and summarize the factors affecting the risk sharing at this stage,and get the focus of the latter analysis: for the risks that need to be shared by the government and the private sector,the determination of their respective share proportion.Next,based on the bargaining game theory under incomplete information and the asymmetry of the status between the government and the private sector,this paper constructs the PPP project risk-sharing proportion game model,puts forward the calculation method of the risk-sharing proportion,and combines with the old city reconstruction case of Changchun.Finally,the paper puts forward some policy suggestions on the factors affecting PPP project risk sharing at this stage.