Puddicombe, M S (2009) Why contracts: Evidence. Journal of Construction Engineering and Management, 135(8), pp. 675-682. ISSN 0733-9364
Abstract
Contracts are a ubiquitous part of the architecture, engineering, and construction industry. Despite this, they are poorly understood by practitioners and academics. This paper empirically tests a conceptual model of the contract that seeks to improve our understanding of contracts. This model argues that the contract should be viewed as a managerial tool that provides the structure within which we accomplish the project tasks. The choice of the appropriate contract facilitates a process that allows the parties to achieve superior performance. The model views the contract as a multidimensional instrument that addresses three critical questions: (1) what is the structure of the organizational relationship between firms; (2) what is the disposition of risk and reward for involvement in the project; and (3) how will conflicts between firms be resolved? This paper empirically examines the first two dimensions. In order to address these distinct but intertwined questions, theories from Transaction Cost Economics and Agency Theory are brought to bear. The results of the study suggest that the conceptual model explains some of the variation in project performance, and therefore holds promise as a strategic management tool.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | construction management; contracts; performance characteristics; regression analysis |
| Index terms: | transaction cost, agency, strategic management, variation, evidence, practitioner, dimension, construction industry, regression analysis, project performance |
| Subjects: | health monitoring assessment and metrics, practitioner, evaluation and assessment methods, industry analysis, statistical analysis, financial analysis, sociology, contractual condition, project management theory and practice, management |
| Topics: | Contract Administration, Research Practice, Project Management, Health and Safety, Business Strategy, Cost Management, Roles and Professions |
| Descriptive scope: | 4 PCTA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here