An option pricing-based model for evaluating the financial viability of privatized infrastructure projects

摘要: Privatized infrastructure projects have to demonstrate their financial and technical viability before they are undertaken. Although it is relatively easy the of an project, evaluation a privatized project complex challenging, mainly because uncertainties involved due project's scale, long concession period complexity. Traditional methods, such as net present value (NPV) analysis, fall short in reflecting characteristics risks involved. This paper presents option pricing based model, BOT valuation (BOT-OV) for evaluating project. quantitative model considers explicitly evaluates from perspectives promoter government when under bankruptcy risk. Moreover, can e...