Wang, X; Liu, R; Ye, K and Tekka, R S (2020) Modelling the cost of collusion in the construction industry: A case of China. In: Scott, L and Neilson, C J (eds.) Proceedings of 36th Annual ARCOM Conference, 7-8 September 2020, Online Event, UK.
Abstract
Within the construction industry, violations of laws and regulations in bidding for construction works are difficult to inhibit. Bidders tend to collude with each other to increase the probability of winning construction projects. To this end, they need to strike a trade-off between costs of collusion and potential benefits from collusion they adopted. This study aims to develop two models, one model used to predict the collusion cost, and another is used to reveal the actual level of fine. 103 collusion cases from China were collected to test the proposed models by regression analysis. The research found that two models both exhibit an upturned positive tendency. The average of the ratio of collusion fine and collusion cost always remained the range of 0 to 0.5. The research findings reveal the changing rule of collusion cost and fine, guide the construction unit to understand the negative impact of collusion fully and provide decision support for relevant government departments in bidding supervision, formulating anti-collusion strategies and related punishment measures.
| Item Type: | Conference Paper (Paper) |
|---|---|
| Uncontrolled Keywords: | construction; collusion cost; fine; China |
| Index terms: | modelling, China, construction industry, violation, bidding, supervision, regression analysis, bidder, construction project, regulation, construction work, strategy, collusion, decision support |
| Subjects: | control systems, operations management, bidding, analytical methods, management, tendering, production management, Geography, decision analysis, industry analysis, regulatory law, statistical analysis, political science |
| Topics: | Risk Management, Governance, Procurement, Business Strategy, Engineering Principles, Research Practice, Geographical Context, Project Management, Legal Issues |
| 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