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Are monitoring and incentives the only mitigation to the buyer agency problem in complex infrastructure developments?

  • Yujia Han
  • , Nigel Caldwell*
  • *Corresponding author for this work

Research output: Contribution to conferencePaperpeer-review

Abstract

In purchasing, agency theory is applied to address aberrant behaviour by the supplier, examined in high volume or contract value industries. Amortised over the length or scale of a continuous relationship, sunk monitoring and incentive costs are recovered through more effective goal alignment between buyers and suppliers. Peripatetic prime contractors deliver one-off complex infrastructure developments globally. Prime buyers source from original equipment manufacturers, relationships which can be transitory and transactional. This study conducted interviews with buyers from power plant construction projects and reports on a new to literature response to agency problems- the use of supply brokers as workarounds.
Original languageEnglish
Publication statusPublished - 30 Mar 2015
Event24th International Purchasing and Supply Education and Research Association Conference 2015 - Amsterdam, Netherlands
Duration: 29 Mar 20151 Apr 2015
https://ipsera.com/event-1722585

Conference

Conference24th International Purchasing and Supply Education and Research Association Conference 2015
Abbreviated titleIPSERA 2015
Country/TerritoryNetherlands
CityAmsterdam
Period29/03/151/04/15
Internet address

Keywords

  • agency theory
  • prime contractors
  • brokers
  • complex infrastructure
  • construction

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