Shrestha, A; Chan, T K; Aibinu, A A; Chen, C and Martek, I (2018) Risk allocation inefficiencies in Chinese PPP water projects. Journal of Construction Engineering and Management, 144(4): 04018013, ISSN 0733-9364
Abstract
Risk management is a key concern in public-private partnership (PPP) projects and the efficient allocation of risk remains problematic. Previous studies on PPP practices have documented the prevalence of inefficiency in risk allocation. Nevertheless, the nature of PPP risk misallocation has not been quantitatively described and verified. This study examines risk allocation in the Chinese water sector as it supports the highest number of PPP projects. Based on the expertise of 32 senior practitioners, statistical analysis is used to contrast where risks ought to lie in order to maximize risk mitigation efficiency with where such risks actually lie. The results confirm that current risk allocation practices are far from ideal, with the implication that current practices play a significant role in project failure. Details within the data provide insight into how practitioners should modify current risk allocation practices to better achieve risk management optimization. The lesson learned from this study can be transferred to projects in other emerging PPP markets.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | China; public-private partnership; risk allocation; risks; water projects |
| Index terms: | partnership, efficiency, statistical analysis, risk allocation, risk management, project failure, markets, practitioner, risk mitigation, China |
| Subjects: | financial risk, economic analysis, performance management, partnership management, project completion, data science, Geography, risk assessment, practitioner |
| Topics: | Roles and Professions, Risk Management, Research Practice, Stakeholder Management, Cost Management, Business Strategy, Quality Management, Geographical Context, Project Management |
| Descriptive scope: | 3 PCA |
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