Government compensation on rental indemnificatory housing in public private partnerships

Government compensation is the key to attract the private sector to participate the projects on rental indemnificatory housing in public private partnerships. If the compensation is expensive, the public authority cannot afford that. Inversely, if the compensation is rarely, there is no enthusiasm for the private sectors' investment. To keep this balance, this paper defines the government compensation contains two parts, the minimum compensation and the promote compensation. Firstly, the minimum compensation, the maximum compensation, and the between compensation internal based on the capital asset pricing model and the data of Shanghai Stock Exchange from CSMAR Solution. Afterwards, as per the private sectors' performance appraisal of the whole of life cycle, the promote compensation is obtained in that interval. Finally, the numerical example is given, comparing with its actual compensation, it proves that this kind of government compensation is feasible and practical.