Revisiting the relationship between contract governance and contractors’ opportunistic behavior in construction projects

Yu Wang, Yongqiang Chen, Wenqian Wang, Yuting Chen, Mengxia Jin

Research output: Contribution to journalJournal articlepeer-review

19 Citations (Scopus)

Abstract

Contracts are crucial for curbing opportunism, a common phenomenon in construction projects. This article differentiates among the contractual mechanisms of obligatoriness, monitoring, and coordination, and studies the relationships between the complexity of the above functions and different types of opportunistic behavior. Using data from 262 clients (i.e., the parties issuing contracts) in the Chinese construction industry, this article reveals that contractual obligatoriness has a negative effect on strong-form opportunistic behavior. At the same time, contractual monitoring and coordination have positive and negative effects, respectively, on weak-form opportunistic behavior. Furthermore, we find that goodwill trust mediates contractual coordination's effect on weak-form opportunistic behavior. This article contributes to both the contract management literature and the interorganizational relationship governance literature by providing more nuanced findings that speak to the debate surrounding the relationship between contractual governance and opportunistic behavior, elaborate the mediation mechanism, and provide insights into the contractual function view.
Original languageEnglish
Pages (from-to)2517-2529
Number of pages13
JournalIEEE Transactions on Engineering Management
Volume69
Issue number6
Early online date21 Oct 2019
DOIs
Publication statusPublished - Dec 2022

User-Defined Keywords

  • Construction projects
  • contract governance
  • contractual complexity
  • goodwill trust
  • opportunistic behavior

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