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Principal agent problems evident in Chinese PPP infrastructure projects
conference contribution
posted on 2015-01-01, 00:00 authored by Asheem ShresthaAsheem Shrestha, Igor MartekIgor MartekThe demand for infrastructure remains high in China. In order to meet this demand under conditions of limited government funding availability, local governments have increasingly sought private participation through ‘public, private partnerships’ (PPPs). While PPPs are recognised as a reliable mode for delivering infrastructure projects, agency problems are also known to interfere with their success. The nature of these agency problems, along with the types of partnership arrangements under which they occur, is the subject of this research. Semi-structured interviews were conducted with PPP consultants working on infrastructure projects in China. Results suggest that opportunistic behaviour is to be found both within the private sector and within the government sector. While the private sector is shown to take advantage of ‘information asymmetries,’ the government sector is shown to allocate project risks and responsibilities disproportionately in their favour. Results also indicate that PPP arrangements between local government and ‘state owned enterprises’ (SOEs) were less prone to agency abuse, while agency problems in PPP arrangements between local government and private firms were relatively greater.
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Event
Advancement of Construction Management and Real Estate. International Symposium (19th : 2014 : Chongqing, China)Pagination
759 - 770Publisher
SpringerLocation
Chongqing, ChinaPlace of publication
Berlin, GermanyPublisher DOI
Start date
2014-11-07End date
2014-11-09ISBN-13
9783662469941Language
engPublication classification
E Conference publication; E1 Full written paper - refereedCopyright notice
2015, SpringerEditor/Contributor(s)
L Shen, K Ye, C MaoTitle of proceedings
Proceedings of the 19th International Symposium on the Advancement of Construction Management and Real EstateUsage metrics
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