Academic Journal
A modeling government revenue guarantees in privately built transportation projects: a risk-adjusted approach
| العنوان: | A modeling government revenue guarantees in privately built transportation projects: a risk-adjusted approach |
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| المؤلفون: | Nakhon Kokkaew, Nicola Chiara |
| المصدر: | Transport, Vol 28, Iss 2 (2013) |
| بيانات النشر: | Vilnius Gediminas Technical University, 2013. |
| سنة النشر: | 2013 |
| المجموعة: | LCC:Transportation engineering |
| مصطلحات موضوعية: | risk analysis, real options, inter-temporal revenue risk, simulation, minimum revenue guarantee (MRG), Transportation engineering, TA1001-1280 |
| الوصف: | Countries around the world have welcomed Public Private Partnerships (PPPs) as an alternative to finance infrastructure. For strategic projects with high demand uncertainty, a government may decide to provide a concessionaire with a Minimum Revenue Guarantee (MRG) to mitigate revenue risk and to help enhance the project's credit, thereby reducing the financing costs of the project. However, government revenue guarantees can pose fiscal risks to the issuing government if too many significant claims are redeemed at the same time. This undesirable circumstance can be exacerbated during an economic recession in which tax revenues are low and the costs of subsidies are potentially higher than expected. This paper presents a new model of government revenue guarantees by which revenue guarantee thresholds are adjusted over time to reflect the inter-temporal risk profiles of the project. Revenue risk is modeled using a stochastic process called the Variance Model. Then, revenue shortfalls and revenue excesses are modeled as multi-early exercise options, and priced using multi-least squares Monte Carlo method. Finally, an illustrative example of a Build-Operate-Transfer (BOT) highway project demonstrates how the proposed model may be applied in practice at the project evaluation stage. The proposed model may help to promote fairer risk allocation between the host government and the concessionaire. |
| نوع الوثيقة: | article |
| وصف الملف: | electronic resource |
| اللغة: | English |
| تدمد: | 16484142 1648-4142 1648-3480 |
| Relation: | https://journals.vgtu.lt/index.php/Transport/article/view/4169; https://doaj.org/toc/1648-4142; https://doaj.org/toc/1648-3480 |
| DOI: | 10.3846/16484142.2013.803262 |
| URL الوصول: | https://doaj.org/article/87fcca01fa1f47169f8b4b95e6489d2b |
| رقم الانضمام: | edsdoj.87fcca01fa1f47169f8b4b95e6489d2b |
| قاعدة البيانات: | Directory of Open Access Journals |
Full Text Finder | تدمد: | 16484142 16483480 |
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| DOI: | 10.3846/16484142.2013.803262 |