Research On The Government Subsidy Strategy Of PPP Project Based On Evolutionary Game

China’s new plans of developing a modern socialist country call for raising the capacity of infrastructure construction to a higher level.It emphasizes on expanding the investment and financing channels,and encourages social capital to participate in the construction in an orderly manner.PPP model can integrate the resources from the government and the society entities.As the PPP projects face many uncertain situations and risks,the government needs to provide subsidies to improve participating enthusiasm of social capital and the public.Reasonable sharing of PPP project risks depends on scientific subsidy strategies.However,the scientificity of the government subsidy strategies still needs to be improved.The project value evaluation methods ignore the flexibility value of project investment management and the full consideration of public interests.Based on the sensible evaluation of the government subsidies value and consideration of public interests,it is of great significance to study the game equilibrium conditions of the government,social capital and the public,and discuss the optimal subsidy strategies of PPP projects.This study is expected to promote the healthy development of PPP model in China.First of all,through the domestic and foreign literature review,the present researching deficiencies are summarized as follows: the public has not yet been considered as a participant in the evolutionary game model and the systematical analysis of subsidy equilibrium strategies has not yet based on the value of government subsidies.In view of this problem,it is described that the characteristics of government-subsidized options,the theoretical basis of the public interests and the advantages of evolutionary game theory in strategic analysis.Then,the project option value and the optimal government subsidy amounts are evaluated using the real option theory.The evaluation results are involved into the tripartite evolutionary game model of the government,the social capital and the social public.The stability of the model is analysed and the parameter conditions of optimum strategy combination is explicit.The trigger mechanism of subsidy policy is built.Finally,according to the study case,the model parameters are reasonably assigned.MATLAB is used to simulate the evolutionary game model and the effectiveness of the path to achieve the optimal strategy combination is verified.The conclusion is drawn as fellow: the tripartite strategy choice can make the combination of government subsidy strategies stable in the optimal state when the government can obtain higher performing returns after paying subsidies,the social capital can obtain higher subsidy than the value of real options,and the public can obtain higher returns by choosing to participate in project consumption.