Impact of contractors' opportunism on construction project transaction costs: Construction professionals' perception. Issue 1 (11th February 2020)

• Record Type: Journal Article
• Authors: Ikuabe, Matthew; Oke, Ayodeji Emmanuel; Aigbavboa, Clinton
• Is Part Of: Journal of financial management of property and construction. Volume 25:Issue 1(2020)
• Page Start: 125
• Page End: 141
• Publication Date: 2020-02-11
• Subjects: Professionals -- Contractors -- Opportunism -- Transaction costs -- Construction cost -- Construction -- Stakeholders; Construction industry -- Finance -- Periodicals; Real estate business -- Finance -- Periodicals; 332.6324
• DOI: 10.1108/JFMPC-04-2019-0040
• Languages: English
• ISSNs: 1366-4387

Abstract

Abstract : Purpose: There is a growing concern of the non-balance of the final output of construction works in comparison the financial resources invested with during the course of construction projects. One propelling factor to this is the opportunistic disposition often sought out by construction contractors. This study aims to investigate the relationship between construction contractors' opportunism and construction project transaction costs from the viewpoint of construction professionals. Design/methodology/approach: Questionnaire survey was deployed in eliciting responses from construction professionals. A total of 337 questionnaires were distributed and 264 were retrieved and deemed fit for analysis. Methods of data analysis used for the study are Mean Item Score, Kruskal–Wallis H-test, Student Newman Kauls Post Hoc Test, Factor Analysis, Spearman Rank Correlation and Regression Analysis. Findings: The study showed that the most-ranked factor influencing contractors' opportunism that affects transaction cost is "Unclear scope of work". Revealed from the study is the differing view of construction professionals of the effect of contractors' opportunism on transaction costs. Equally revealed through Spearman correlation analysis is the potent effect that contractors' opportunism has on transaction costs. Likewise, the study established that there is a discovered difference among construction professionals' perceived effect of contractors' opportunism on construction transaction costs. Originality/value: The study establishes the nexus between construction contractors' opportunistic disposition and construction transaction costs, which are shown to be highly correlated. The study went further to recommend that efforts should be made to ensure that issues like contract documentation should be well and appropriately carried out; roles and responsibilities of stakeholders should be well defined so as to fully keep all parties to a contract abreast with the expectations of their duties in relation to the project objectives.