Incentive Model Based on Cooperative Relationship in Sustainable Construction Projects

Abstract

Considering the cooperative relationship between owners and contractors in sustainable construction projects, as well as the synergistic effects created by cooperative behaviors, a cooperative incentive model was developed using game theory. The model was formulated and analyzed under both non-moral hazard and moral hazard situations. Then, a numerical simulation and example were proposed to verify the conclusions derived from the model. The results showed that the synergistic effect increases the input intensity of one party's resource transfer into the increase of marginal utility of the other party, thus the owner and contractor are willing to enhance their levels of effort. One party's optimal benefit allocation coefficient is positively affected by its own output efficiency, and negatively affected by the other party's output efficiency. The effort level and expected benefits of the owner and contractor can be improved by enhancing the cooperative relationship between the two parties, as well as enhancing the net benefits of a sustainable construction project. The synergistic effect cannot lower the negative effect of moral hazard behaviors during the implementation of sustainable construction projects. Conversely, the higher levels of the cooperative relationship, the wider the gaps amongst the optimal values under both non-moral hazard and moral hazard situations for the levels of effort, expected benefits and net project benefits. Since few studies to date have emphasized the effects of cooperative relationship on sustainable construction projects, this study constructed a game-based incentive model to bridge the gaps. This study contributes significant theoretical and practical insights into the management of cooperation amongst stakeholders, and into the enhancement of the overall benefits of sustainable construction projects.

A Multi-Objective Trade-Off Model in Sustainable Construction Projects

“…The project benefits will almost certainly be reduced if both the owner and contractor tend to maximize and prioritize their own benefits [17,65]. Therefore, the optimal behavioral arrangements of these two parties are to achieve their own maximum benefits, but under the strict condition of maximizing the project benefit.…”

“…where A is the outcome coefficient of the effort levels of the contractor, which can manifest by the integrated technical level and comprehensive management ability of the contractor [17]. The outcome coefficient of the effort levels is related to the operational management capability, project experiences and employee competences of the contractor.…”

“…The owner's payment to the contractor follows a linear function [17,60]. The benefit allocation coefficient and the constant payments for the contractor are β and , respectively.…”

Profit Allocation of Hybrid Power System Planning in Energy Internet: A Cooperative Game Study

“…Game theory is divided into cooperative game theory and non-cooperative game theory [47]. This paper deals with the problem of hybrid power system planning in EI, which can reach an alliance in advance, so it belongs to the category of cooperative game and emphasizes on collective rationality.…”

Management Strategies and Innovations: Important Roles to Sustainable Construction

“…Jiang, et al [17] investigated the influence of transformational leadership on employee performance in sustainable construction projects, and found that employee sustainable performance was positively influenced by transformational leadership and more than half of that influence was mediated by their organizational citizenship behavior. Wu, et al [18] developed a cooperative incentive model to investigate the cooperative relationship between owners and contractors in sustainable construction projects, as well as the synergistic effects created by cooperative behaviors. Mella and Pellicelli [19] investigated the levers that weaken people's intention of conducting sustainable behaviors.…”