关键词: 政府与社会资本合作, 地方财政风险, 债券市场, 双重差分

Abstract: Proponents of the PublicPrivate Partnerships (PPP) argue that PPP can decrease financial pressures, diversify investment risks, and improve resource allocation efficiency for local governments. In contrast, opponents argue that a large number of government guarantees and subsidies are often embedded in PPP, encouraging corruption and rentseeking. The reduction of fiscal pressure within the budget is only a financial illusion, which invariably accumulates systemic risks. This paper uses the bond issuance data of China during 20152020 and the information of PPP projects in various places to test whether or not the interest rates of local public bonds respond to the large scale implementation of PPP, with local public bonds as the treated and national debt and financial corporates' bonds as the control under a Difference in Differences setup. The empirical results show that the sharp increase in PPP projects around 20162017 raises the interest rates of local government bonds, indicating interest penalties from the financial market. Specifically, the risk premium is 6.729.7 basis points for local bonds with a 5year maturity, while the risk premium is 2141 basis points for 10year bonds, and the effects are heterogeneous across regions with more and fewer PPP projects. The results are robust to a battery of tests, including changing the control group, postponing PPP projects actual time to take effect on local public finance, and certain placebo tests. Finally, possible explanations to the empirical findings are discussed, and some feasible measures are proposed to promote the sound development of PPP.

Key words:  PPP, local fiscal risks, bond market, difference in differences