A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects
Purpose The net-present-value (NPV) method is well-known for its drawbacks. To overcome some of these NPV weaknesses this paper aims to provide a methodology to determine an optimal concession period that treats risk and time separately. The purpose of this paper is to apply the notion of risk-adjus...
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| المؤلف الرئيسي: | |
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| مؤلفون آخرون: | , |
| منشور في: |
2020
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| الموضوعات: | |
| الوصول للمادة أونلاين: | https://bspace.buid.ac.ae/handle/1234/2382 https://doi.org/10.1108/BEPAM-12-2019-0134 |
| الوسوم: |
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| _version_ | 1862980615066877952 |
|---|---|
| author | Nguyen, Nhat |
| author2 | Almarri, Khalid Boussabaine, Halim |
| author2_role | author author |
| author_facet | Nguyen, Nhat Almarri, Khalid Boussabaine, Halim |
| author_role | author |
| dc.creator.none.fl_str_mv | Nguyen, Nhat Almarri, Khalid Boussabaine, Halim |
| dc.date.none.fl_str_mv | 2020-09 2023-11-07T09:35:20Z 2023-11-07T09:35:20Z |
| dc.format.none.fl_str_mv | application/pdf |
| dc.identifier.none.fl_str_mv | Nguyen, N., Almarri, K. and Boussabaine, H. (2021), "A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects", Built Environment Project and Asset Management, Vol. 11 No. 1, pp. 4-21. 2044-124X https://bspace.buid.ac.ae/handle/1234/2382 https://doi.org/10.1108/BEPAM-12-2019-0134 |
| dc.language.none.fl_str_mv | en |
| dc.publisher.none.fl_str_mv | Emerald Publishing Limited https://www.emerald.com/insight/content/doi/10.1108/BEPAM-12-2019-0134/full/html |
| dc.relation.none.fl_str_mv | Built Environment Project and Asset Management https://www.emerald.com/insight/content/doi/10.1108/BEPAM-12-2019-0134/full/html |
| dc.subject.none.fl_str_mv | PPP, BOT, risk-adjusted DNPV, concession period |
| dc.title.none.fl_str_mv | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects |
| dc.type.none.fl_str_mv | Article |
| description | Purpose The net-present-value (NPV) method is well-known for its drawbacks. To overcome some of these NPV weaknesses this paper aims to provide a methodology to determine an optimal concession period that treats risk and time separately. The purpose of this paper is to apply the notion of risk-adjusted decoupled net present value (risk-adjusted DNPV) to determine a conception period taken into consideration synthetic insurance premiums as compensation for risks. Design/methodology/approach This paper conducts theoretical and empirical analysis and provides an integrated model for deriving concession periods of any PPP projects. The model is able to capture several contractual issues such risks costing and other contractual scenarios. Methodologically, the paper addressees both the issues of risk-based cost–benefit analysis and cash flow analysis bearing an emphasis of risk-adjusted DNPV to compute an optimum concession period. Findings The results show that using DNPV will produce a shorter concession period comparatively to NPV. The consequence of this is that the public sector will gain financially from an earlier transfer of the concession. Research limitations/implications This paper contributes to the PPP literature by combing DNPV and risk to determine the PPP concession period for the mutual benefits both the private and public sectors. The decoupling of risk from traditional NPV computation will allow for risk pricing and tradability through insurance and allocation. Originality/value The attempt to decouple time and risk in the computation of NPV is the added value to the body of knowledge. |
| id | budr_432fe883c1150019808bc2ada60666b3 |
| identifier_str_mv | Nguyen, N., Almarri, K. and Boussabaine, H. (2021), "A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects", Built Environment Project and Asset Management, Vol. 11 No. 1, pp. 4-21. 2044-124X |
| language_invalid_str_mv | en |
| network_acronym_str | budr |
| network_name_str | The British University in Dubai repository |
| oai_identifier_str | oai:bspace.buid.ac.ae:1234/2382 |
| publishDate | 2020 |
| publisher.none.fl_str_mv | Emerald Publishing Limited https://www.emerald.com/insight/content/doi/10.1108/BEPAM-12-2019-0134/full/html |
| repository.mail.fl_str_mv | |
| repository.name.fl_str_mv | |
| repository_id_str | |
| spelling | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projectsNguyen, NhatAlmarri, KhalidBoussabaine, HalimPPP, BOT, risk-adjusted DNPV, concession periodPurpose The net-present-value (NPV) method is well-known for its drawbacks. To overcome some of these NPV weaknesses this paper aims to provide a methodology to determine an optimal concession period that treats risk and time separately. The purpose of this paper is to apply the notion of risk-adjusted decoupled net present value (risk-adjusted DNPV) to determine a conception period taken into consideration synthetic insurance premiums as compensation for risks. Design/methodology/approach This paper conducts theoretical and empirical analysis and provides an integrated model for deriving concession periods of any PPP projects. The model is able to capture several contractual issues such risks costing and other contractual scenarios. Methodologically, the paper addressees both the issues of risk-based cost–benefit analysis and cash flow analysis bearing an emphasis of risk-adjusted DNPV to compute an optimum concession period. Findings The results show that using DNPV will produce a shorter concession period comparatively to NPV. The consequence of this is that the public sector will gain financially from an earlier transfer of the concession. Research limitations/implications This paper contributes to the PPP literature by combing DNPV and risk to determine the PPP concession period for the mutual benefits both the private and public sectors. The decoupling of risk from traditional NPV computation will allow for risk pricing and tradability through insurance and allocation. Originality/value The attempt to decouple time and risk in the computation of NPV is the added value to the body of knowledge.Emerald Publishing Limited https://www.emerald.com/insight/content/doi/10.1108/BEPAM-12-2019-0134/full/html2023-11-07T09:35:20Z2023-11-07T09:35:20Z2020-09Articleapplication/pdfNguyen, N., Almarri, K. and Boussabaine, H. (2021), "A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects", Built Environment Project and Asset Management, Vol. 11 No. 1, pp. 4-21.2044-124Xhttps://bspace.buid.ac.ae/handle/1234/2382https://doi.org/10.1108/BEPAM-12-2019-0134enBuilt Environment Project and Asset Managementhttps://www.emerald.com/insight/content/doi/10.1108/BEPAM-12-2019-0134/full/htmloai:bspace.buid.ac.ae:1234/23822023-11-08T23:00:46Z |
| spellingShingle | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects Nguyen, Nhat PPP, BOT, risk-adjusted DNPV, concession period |
| title | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects |
| title_full | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects |
| title_fullStr | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects |
| title_full_unstemmed | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects |
| title_short | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects |
| title_sort | A risk-adjusted decoupled-net-present-value model to determine the optimal concession period of BOT projects |
| topic | PPP, BOT, risk-adjusted DNPV, concession period |
| url | https://bspace.buid.ac.ae/handle/1234/2382 https://doi.org/10.1108/BEPAM-12-2019-0134 |