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contributor authorS. Mahdi Hosseinian
contributor authorAmirhomayoun Jaberi
date accessioned2024-04-27T22:45:00Z
date available2024-04-27T22:45:00Z
date issued2024/02/01
identifier other10.1061-JCEMD4.COENG-13652.pdf
identifier urihttp://yetl.yabesh.ir/yetl1/handle/yetl/4297403
description abstractSharing of a project’s outcomes drives the contracting parties to closer cooperation. However, subcontracting and sharing with downstream contracting parties (e.g., subcontractor and sub-subcontractor) have received less attention in the construction literature. This paper proposes an optimal multilayer outcome-sharing model for construction contracts between a client and a construction team (e.g., including contractors, subcontractors, and sub-subcontractors), based on existing utility and principal–agent models. A numerical study supports the validity of the proposed model and the paper’s propositions. The findings indicate that optimal effort levels by downstream parties result in cost savings for all contracting parties, promoting fair and efficient outcome sharing. Moreover, the study highlights that contracts with risk-neutral downstream contracting parties lead to the most significant cost-saving for the client. The paper’s contribution lies in establishing a connection between optimal sharing in upstream layers and downstream layers. The modeling approach is original, with no similar models found in the existing literature. The model can be utilized by those involved in writing incentive contracts to determine the best approach for sharing project outcomes with downstream parties. The paper sheds new light on the sharing problem in multilayer contracting. During the tendering process, clients, contractors, subcontractors, and others may encounter challenges in negotiating appropriate outcome-sharing contracts. The insights gained from this article will assist them in navigating such negotiations, particularly in cases where the construction project involves a high level of uncertainty.
publisherASCE
titleOptimal Sharing of Construction Project Outcomes with Downstream Contracting Parties: Principal–Agent Analysis
typeJournal Article
journal volume150
journal issue2
journal titleJournal of Construction Engineering and Management
identifier doi10.1061/JCEMD4.COENG-13652
journal fristpage04023156-1
journal lastpage04023156-17
page17
treeJournal of Construction Engineering and Management:;2024:;Volume ( 150 ):;issue: 002
contenttypeFulltext


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