Next Article in Journal
Design Thinking for Urban Water Sustainability in Huelva’s Households: Needfinding and Synthesis through Statistic Clustering
Next Article in Special Issue
Exploring Water Landscape Adaptability of Urban Spatial Development Base on Coupling Coordination Degree Model A Case of Caidian District, Wuhan
Previous Article in Journal
Effects of Different Ages of Robinia pseudoacacia Plantations on Soil Physiochemical Properties and Microbial Communities
Article

Default Behaviors of Contractors under Surety Bond in Construction Industry Based on Evolutionary Game Model

1
Department of Construction Management, Tsinghua University, Beijing 100084, China
2
Department of Mechanical Engineering, Prince Sattam Bin Abdulaziz University, Al-Kharj 16273, Saudi Arabia
3
School of Economics and Management, Fuzhou University, Fujian 350108, China
*
Authors to whom correspondence should be addressed.
Sustainability 2020, 12(21), 9162; https://doi.org/10.3390/su12219162
Received: 21 August 2020 / Revised: 18 October 2020 / Accepted: 30 October 2020 / Published: 4 November 2020
(This article belongs to the Special Issue Green Public Procurement in Civil Engineering at a Regional Level)
In construction projects, some contractors will take default actions against the contracts to obtain maximum profits and damage the owners’ benefits as a result. In the construction markets where effective supervision is not performed well, contractors have more opportunities to default. Surety bonds were designed to solve the default problems and promote the sustainable development of the construction markets. This paper was proposed to explore the interactions between owners and contractors and investigate the influence of surety bonds (high penalty and low penalty) on the default behavior of contractors based on a static and dynamic evolutionary game analysis model. The results showed that applying the surety bond strategy is effective at decreasing the probability of the contractors’ default behavior when the credit system based on a surety bond system is well developed in the construction industry and the cost of the surety bond is low enough. Therefore, government strategies such as a better development of the credit system driven by surety bonds and the subsidies on surety bonds to reduce the cost can mitigate the contractors’ default behavior and keep the sustainability of the construction markets. View Full-Text
Keywords: contractors; default; surety bond; evolutionary game; construction market contractors; default; surety bond; evolutionary game; construction market
Show Figures

Figure 1

MDPI and ACS Style

Jing, J.; Deng, X.; Maqbool, R.; Rashid, Y.; Ashfaq, S. Default Behaviors of Contractors under Surety Bond in Construction Industry Based on Evolutionary Game Model. Sustainability 2020, 12, 9162. https://doi.org/10.3390/su12219162

AMA Style

Jing J, Deng X, Maqbool R, Rashid Y, Ashfaq S. Default Behaviors of Contractors under Surety Bond in Construction Industry Based on Evolutionary Game Model. Sustainability. 2020; 12(21):9162. https://doi.org/10.3390/su12219162

Chicago/Turabian Style

Jing, Jiabao, Xiaomei Deng, Rashid Maqbool, Yahya Rashid, and Saleha Ashfaq. 2020. "Default Behaviors of Contractors under Surety Bond in Construction Industry Based on Evolutionary Game Model" Sustainability 12, no. 21: 9162. https://doi.org/10.3390/su12219162

Find Other Styles
Note that from the first issue of 2016, MDPI journals use article numbers instead of page numbers. See further details here.

Article Access Map by Country/Region

1
Back to TopTop