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Article: Dubious benefits from future exchange: An explanation of payment arrears from 'continuing clients' in Mainland China

TitleDubious benefits from future exchange: An explanation of payment arrears from 'continuing clients' in Mainland China
Authors
KeywordsCollaboration
Game Theory
Opportunism
Payment Arrears
Transaction Cost
Issue Date2011
PublisherRoutledge. The Journal's web site is located at http://www.tandf.co.uk/journals/titles/01446193.asp
Citation
Construction Management And Economics, 2011, v. 29 n. 1, p. 15-23 How to Cite?
AbstractClients and contractors are frequently advised to adopt a collaborative attitude and approach in construction projects in general, with 'continuing clients', i.e. clients with continuous large projects portfolios, expected to be in the forefront of such initiatives. Although such a governance approach has been argued to be beneficial in construction transactions, it is not uncommon to hear contractors complaining that clients do not fulfil their payment obligations. For example, in Mainland China, a large proportion of deliberate payment arrears are from 'continuing clients'. Gametric models are used in this research to show that three prerequisites are needed for inducing continuing clients to be cooperative. Empirical evidence from legislation and a questionnaire survey indicates that these preconditions are not fulfilled in Mainland China. Prevalent institutional arrangements, differentials in appreciation of the value of relationships, and opaque payment track records are found to contribute to continuing clients' deviation from the often advocated amicable approaches. Thus, transaction attributes seem to only suggest a theoretically optimal governance structure from the perspective of transaction costs, but other factors may also substantially influence parties' calculation and choice. © 2011 Taylor & Francis.
Persistent Identifierhttp://hdl.handle.net/10722/150544
ISSN
2015 SCImago Journal Rankings: 0.967
References

 

DC FieldValueLanguage
dc.contributor.authorWu, Jen_US
dc.contributor.authorKumaraswamy, Men_US
dc.contributor.authorSoo, GKLen_US
dc.date.accessioned2012-06-26T06:05:35Z-
dc.date.available2012-06-26T06:05:35Z-
dc.date.issued2011en_US
dc.identifier.citationConstruction Management And Economics, 2011, v. 29 n. 1, p. 15-23en_US
dc.identifier.issn0144-6193en_US
dc.identifier.urihttp://hdl.handle.net/10722/150544-
dc.description.abstractClients and contractors are frequently advised to adopt a collaborative attitude and approach in construction projects in general, with 'continuing clients', i.e. clients with continuous large projects portfolios, expected to be in the forefront of such initiatives. Although such a governance approach has been argued to be beneficial in construction transactions, it is not uncommon to hear contractors complaining that clients do not fulfil their payment obligations. For example, in Mainland China, a large proportion of deliberate payment arrears are from 'continuing clients'. Gametric models are used in this research to show that three prerequisites are needed for inducing continuing clients to be cooperative. Empirical evidence from legislation and a questionnaire survey indicates that these preconditions are not fulfilled in Mainland China. Prevalent institutional arrangements, differentials in appreciation of the value of relationships, and opaque payment track records are found to contribute to continuing clients' deviation from the often advocated amicable approaches. Thus, transaction attributes seem to only suggest a theoretically optimal governance structure from the perspective of transaction costs, but other factors may also substantially influence parties' calculation and choice. © 2011 Taylor & Francis.en_US
dc.languageengen_US
dc.publisherRoutledge. The Journal's web site is located at http://www.tandf.co.uk/journals/titles/01446193.aspen_US
dc.relation.ispartofConstruction Management and Economicsen_US
dc.subjectCollaborationen_US
dc.subjectGame Theoryen_US
dc.subjectOpportunismen_US
dc.subjectPayment Arrearsen_US
dc.subjectTransaction Costen_US
dc.titleDubious benefits from future exchange: An explanation of payment arrears from 'continuing clients' in Mainland Chinaen_US
dc.typeArticleen_US
dc.identifier.emailKumaraswamy, M:mohan@hkucc.hku.hken_US
dc.identifier.authorityKumaraswamy, M=rp00126en_US
dc.description.naturelink_to_subscribed_fulltexten_US
dc.identifier.doi10.1080/01446193.2010.521757en_US
dc.identifier.scopuseid_2-s2.0-79251650233en_US
dc.relation.referenceshttp://www.scopus.com/mlt/select.url?eid=2-s2.0-79251650233&selection=ref&src=s&origin=recordpageen_US
dc.identifier.volume29en_US
dc.identifier.issue1en_US
dc.identifier.spage15en_US
dc.identifier.epage23en_US
dc.publisher.placeUnited Kingdomen_US
dc.identifier.scopusauthoridWu, J=25123277000en_US
dc.identifier.scopusauthoridKumaraswamy, M=35566270600en_US
dc.identifier.scopusauthoridSoo, GKL=25123211600en_US
dc.identifier.citeulike8744951-

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