Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/227659 
Authors: 
Year of Publication: 
2020
Citation: 
[Journal:] KDI Journal of Economic Policy [ISSN:] 2586-4130 [Volume:] 42 [Issue:] 4 [Publisher:] Korea Development Institute (KDI) [Place:] Sejong [Year:] 2020 [Pages:] 117-138
Publisher: 
Korea Development Institute (KDI), Sejong
Abstract: 
Few studies have specifically focused on the uncertainty of demand forecasting despite the fact that uncertainty is the one of greatest risks for governments and private partners in PPP projects. This study presents a methodology for finding robust contract conditions considering uncertainty in travel demand forecasting in a PPP project. Through a case study of an urban railway PPP project in Korea, this study uncovered the risk of excessive government payments to private partners due to the uncertainty in contracted forecast ridership levels. The results allow the suggestion that robust contract conditions could reduce the expected total level of government payments and lower user fees while maintaining profitability of the project. This study offers a framework that assists contract negotiators and gives them more information regarding financial risks and vulnerabilities and helps them to quantify the likelihood of these vulnerabilities coming into play during PPP projects.
Subjects: 
PPP
BTO-rs
Contract Conditions
Robustness
Uncertainty
Forecast
Ridership
JEL: 
R42
R40
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-sa Logo
Document Type: 
Article

Files in This Item:
File
Size





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.