Bayesian Technique Framework for Allocating Demand Risk between the Public and Private Sector in PPP Projects
During a PPP (Public Private Partnership) project procurement, the private contractors priced the risk metrics and further negotiation has to be carried out until bother parties finally reach an agreement and sign the contract. The negotiations should consider whether the public sector should either accept the high risk cost, share the risks with the public sector, or retain the risk in the public sector. In the negotiation process, the decision of risk sharing is one of the most difficult task. When one party receives an offer (or counteroffer) from its opponent, he will analyses the offer, modifies its beliefs about the opponent and makes a counteroffer accordingly. The updated belief then becomes the agents prior knowledge in the next updating process. An agent can finally get a relatively accurate belief about the opponent even if its initial domain knowledge is not so accurate. Both sides information is becoming clear once the negotiation goes further deeper. This paper adopted Bayesian updating techniques to provide a method for a new approach of risk allocation, which focusing how to distribute risk management responsibility between the public client and private contractor.
PPP Project Contract Negotiation Risk Allocation Bayesian
Bing Li Zhaoming Ren
School of Management,Xiamen University,China 361005 School of Built Environment,University of Glamorgan,Pontypridd,CF37 1DL UK
国际会议
2009 6th International Conference on Service Systems and Service Management( 2009 第六届服务系统与服务管理国际会议)
厦门
英文
837-841
2009-06-08（万方平台首次上网日期，不代表论文的发表时间）