Factors and principles influencing control right allocation in public-private partnership projects
WANG Shouqing1, NIU Yunshi1, WU Di2, CHU Xiaoling3
1. Hang Lung Center for Real Estate, Department of Construction Management, Tsinghua University, Beijing 100084, China; 2. Research Center, China International Engineering Consulting Corporation, Beijing 100048, China; 3. Department of Real Estate and Construction, The University of Hong Kong, Hong Kong 999077, China
Abstract：Reasonable allocation of control rights is a precondition for successful implementation of public-private partnerships (PPP) projects. However, the optimal allocation schemes often differ for different projects. Therefore, the factors influencing the control rights and allocation principles have important theoretical and practical meanings. This paper describes the project features reflected by different influencing factors as the importance of the three dimcnsions of various decisions in PPP projects based on the control rights, decision theory and failure mode and effects analysis (FMEA) processing. The relationships between these key factors and the decisions are verified using the factor analysis with this study identifying 15 possible factors that influence the control rights of PPP projects. Then, an OLS regression analysis and a Logistic regression analysis are used to explore how these factors impact the allocation of PPP project control rights. The results show that 12 of the 15 key factors have different effects on the control rights of governments and enterprises. Four control right allocation principles are identified that make full use of the professional advantages of enterprises, provide reasonable decentralization of the government power, ensure reasonable earnings for the enterprises and provide win-win cooperation between the government and the enterprises in PPP projects.
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