Using Agent-Based Modeling to Determine the Concession Period of BOT Contracts

Abstract

Nowadays, build-operate-transfer (BOT) contracts have become particularly important. Since the private-sector’s return in this type of contract depends on the duration of the concession period (CP), its determination is a challenging issue. The present study provides a framework for determining the CP of BOT contracts using agent-based modeling. The proposed framework includes six steps: project recognition, factor recognition, exploring the parameters affecting agents’ behavior, agents’ behavioral modeling, designing the communication pattern, and finally, calculating the CP. To better understanding, the proposed methodology was employed in a real freeway project. After six steps, the effect of toll rates and construction costs was investigated over the project’s CP in five scenarios. The results showed that by using this method in different scenarios, the optimal CP in BOT projects can be varied. Also, based on the sensitivity analysis performed in the case study, it was found that the simulated model output is very sensitive to the parameter of the economic status of large businesses and, in contrast, has the least effect on the air pollution variable.