Contract duration: Barrier or bridge to successful public-private partnerships?

Hartman, Paul L.; Ogden, Jeff; Jackson, Ross A.

doi:10.1016/j.techsoc.2020.101403

Cited by 6 publications

(7 citation statements)

References 75 publications

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“…Hence, the rate of inter-firm contract performance can be considered a realistic representation of their transaction costs (Williamson, 1979). Previous research on contract performance rates has explored their relationship with business performance and firm behavior, such as the return on assets (Manullang et al, 2020;Hasanudin et al, 2022) and profitability (Pratama et al, 2021) of firms as well as the willingness of private suppliers to engage in public-private partnership projects (Hartman et al, 2020). While existing studies have examined the effect of contract fulfillment on firm behavior, few studies have combined contract performance rates with entrepreneurs' risk attitudes.…”

Section: Contract Performance Ratementioning

confidence: 99%

How do contract performance rates affect entrepreneurs’ risk-averse attitudes? Evidence from China

et al. 2023

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IntroductionEntrepreneurs’ attitudes toward risk is one of the most critical factors influencing business growth and economic development. Therefore, addressing the influencing factors and formation mechanisms of entrepreneurs’ risk attitudes has become a crucial research endeavor. In this paper, we examine how contract performance rates affect entrepreneurs’ risk attitudes through the mediating effect of subjective well-being as well as assess the moderating effect of the regional business environment on this relationship.MethodsThe ordered probit regression technique was employed to analyze the data obtained from 3,660 sampled respondents from the 2019 China Household Finance Survey. All analysis was performed using Stata 15.0.ResultsThe empirical results show that contract performance rates have a substantial positive indirect effect on entrepreneurs’ degree of risk aversion through improved subjective well-being. The regional business environment plays a negative regulatory role in the relationship between contract performance rates and entrepreneurs’ risk aversion. Furthermore, urban–rural heterogeneity appears to consistently determine the extent of the influence of contract performance rates on entrepreneurs’ risk attitudes.ConclusionTo reduce entrepreneurs’ risk aversion and enhance social and economic activity, the government should improve regional business environments by taking specific measures. Our study contributes to the empirical understanding of entrepreneurs’ investment decisions in the context of urban and rural environments.

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Section: Contract Performance Ratementioning

confidence: 99%

How do contract performance rates affect entrepreneurs’ risk-averse attitudes? Evidence from China

et al. 2023

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“…They examined access to technological innovation (Ellis et al ., 2012; Li et al ., 2022), performance measurement (Giannakis, 2007; Liao et al ., 2020), selection strategies (Inemek and Tuna, 2009), or trust and reciprocity (Tchokogué and Merminod, 2021). The existing studies from the buyer's standpoint have mainly investigated strategies of supplier selection (Hartman et al ., 2020; Kannan and Choon Tan, 2006) and overlooked the buyer's perception of the collaboration unfolding for NPD. In this research, we particularly focus on the buyer's perspective on the socialization mechanisms that should be implemented in collaborative NPD projects and their impact on project performance.…”

Section: Theoretical Backgroundmentioning

confidence: 99%

“…Indeed, literature mainly investigated the supplier's perception of buyer–supplier relationships such as technological innovation (Ellis et al ., 2012; Li et al ., 2022), performance assessment (Giannakis, 2007; Liao et al ., 2020) or trust (Tchokogué and Merminod, 2021). The few studies that examined the buyer's perspective focused on criteria and strategies of supplier selection (Gligor, 2020; Hartman et al ., 2020; Kannan and Choon Tan, 2006). Our research particularly considers the buyer's perception on socialization best practices that should be implemented in collaborative NPD projects and their impact on project financial and non-financial performance, as a positive perception promotes the relational commitment and collaboration quality of both parties.…”

Section: Introductionmentioning

confidence: 99%

Supplier involvement in NPD projects: the buyer's perspective on the complementary roles of social capital and social exchange for project performance

Benhayoun

Dain

Saikouk

et al. 2023

IJLM

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PurposeBuying firms involve suppliers early in New Product Development (NPD) projects to benefit from their capabilities. The authors investigate the joint impact on project performance improvement, of the social capital established throughout the project, and the strategic preferred buyer/supplier statuses awarded prior to the project, from the buyer's perspective.Design/methodology/approachThe authors propose a conceptual model underlining the complementary contribution to project performance of social capital dimensions and of preferred partners' statuses resulting from social exchange expectations. The model is analyzed with Partial Least Squares using 80 responses of purchasers and R&D managers involved in collaborative NPD projects with suppliers.FindingsThe relational capital built during the project has a positive central role, with a direct impact on NPD project performance and mediating effects through cognitive and structural capitals. The preferred partners' statuses have strong direct impacts on performance, and mediating effects that do not completely supplant the social capital's contribution.Practical implicationsThe implications for the efficient management of supplier involvement are twofold. First, the authors encourage strategic investments of buying firms to acquire preferred buyer's status and to support preferred supplier programs. Second, the authors alert them on the importance of establishing trust and shared cognition during the project.Originality/valueThis study captures NPD project performance from the social angle of buyer–supplier relationship management. It demonstrates the complementarity of relationship management at the strategic and operational levels, before and during the project unfolding.

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“…Modigliani–Miller theorem inspects the creation of an ideal capital structure in PPP-based projects (Verdouw and Rebel, 2015). As per Modigliani–Millar theorem, the total cost of capital imitates the risk profile and, therefore should have no collision of the financial structure of PPP-based projects (Hartman et al , 2020). However, PPP is considered as a long-term nexus that reflects a risk sharing accord between public and private sectors (Du et al , 2018; Giti et al , 2020).…”

Section: Literature Reviewmentioning

confidence: 99%

“…This challenge is gradually increasing because of the varying risk perceptions of the investors. Cost of capital plays a notable part in evaluating the lifecycle cost of PPP-based projects and is becoming a market need for both the investors as well as the project authorities (Hartman et al , 2020).…”

Section: Introductionmentioning

confidence: 99%

Risk perception and cost of capital in emerging market projects using dynamic conditional correlation model

Afzal

Shehzad

Rehman

et al. 2022

IMEFM

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Purpose Cost estimation is a major concern while planning projects on public–private partnership (PPP) terms in developing countries. To bridge the gap of the right approximation of cost of capital, this study aims to sermon a significant role of investor’s risk perception as unsystematic risk in PPP-based energy projects. Design/methodology/approach To investigate the effective mechanism of determining cost of capital and valuing the capital budgeting, a pure-play method has been acquired to measure systematic risk. In addition, dynamic conditional correlation (DCC) and generalized autoregressive conditional heteroscedasticity (GARCH) models have been applied to calculate weighted average cost of capital. Findings Initially, a joint cost of capital of energy-related projects has been calculated using DCC-GARCH and pure-play method. Investors risk perception has been discussed through market point of view using country risk premium modeling. Latter yearly betas have been calculated using DCC signifying the final outcomes that applying a dynamic model can provide a better cost estimation in emerging economies. Practical implications The findings are implicating that due to the involvement of international investors, domestic risk is linked with country risk. In such situations, market-related information is a key factor to find out the market performance, helping in the estimation of cost of capital through capital asset pricing model (CAPM). High dynamic nature of emerging economies causes an impediment in the estimation of cost of capital. Consequently, to calculate risk in dynamic markets, this study has acquired DCC model that can predict the value of beta factor. Originality/value Study contributes to the body of knowledge by addressing an important issue of investor’s risk perception and effective implication of CAPM using pure-play and DCC-GARCH when data is not promptly available in dynamic situations.

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Contract duration: Barrier or bridge to successful public-private partnerships?

Cited by 6 publications

References 75 publications

How do contract performance rates affect entrepreneurs’ risk-averse attitudes? Evidence from China

How do contract performance rates affect entrepreneurs’ risk-averse attitudes? Evidence from China

Supplier involvement in NPD projects: the buyer's perspective on the complementary roles of social capital and social exchange for project performance

Risk perception and cost of capital in emerging market projects using dynamic conditional correlation model

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