Research On Impact Of Employer’s And Contractor’s Trust On Cooperation In Construction Project:From A Perspective Of Contractural Flexibility

The contractual relationship of the main participants in the project-the employer and the contractor, is often characterized as inefficient and antagonistic. The employer consistently transfer risk to the contractor while expanding their control, in case of contractors’ moral hazard and opportunism behavior. Contractors were reluctant to accept the contract and are unwilling to carry it out by taking every possible measure such as utilizing the variation, adjustment and claim event to survive. Disputes may arise from the endless shirking responsibility in performance caused by confrontational cogitation between the two sides, resulting in schedule delays, investment out of control, or even poor quality, thus causing their benefit to suffer injury. One effective way to solve this dilemma is to change the antagonistic relationship by cooperating actively based on common interest between the employer and the contractor.Scholars have emphasized the important role of cooperation to achieve the goal. If the cooperation can be maintained, the employer and the contractor can share greater risk to make goals a reality, and cooperation in the project will substitute for the traditional pattern of confrontation. Under the circumstances, common goal of all parties is easier to achieve. In this context, trust has been considered theoretically as an effective means of promoting cooperation and a key governance factor to induce partnership and establish the environment of cooperation. But existing scholars failed to discuss the relationship between trust and cooperation in depth, to reveal the mechanism of how trust impact cooperation, and to effectively motivate contracting parties to cooperate based on the generation of mutual trust. This article found that contractual flexibility is one of most common techniques’ of risk coping used by employers and an effective way of the negotiations and reasonable risk-sharing. As contractual flexibility embedded is unfold under the premise of mutual trust of the contracting parties and can be regarded as an adjustment mechanism afterwards to promote cooperation, it can be deemed as an important mediating factor in the relationship between trust and cooperation. In this paper, with literature research, theoretical deduction, surveys and empirical analysis, we explored the relationship among trust, contractual flexibility and cooperation. The following aspects of this issue are discussed:(1) Based on the theory of governance and the existing literature concerning the relationship among trust, contractual flexibility and cooperation, we built the association mode of relationship among trust, contractual flexibility and cooperation. Based on existing research, this paper proposed the theoretical hypothesis. This paper presents contractual flexibility as an important mediating factor in the relationship between trust and cooperation and discuss trust in three categories: competence-based trust, intuition-based trust and Guanxin-based trust.(2) Through interviews with experts and group discussions, we defined trust I project organization, contractual flexibility and cooperation and developed the corresponding measurement scale. Based on the practice of collecting sample project data, we tested reliability and validity measuring scale.(3) The research used structural equation model to test the theoretical assumptions based on 220 valid questionnaires collected, then revealed and verified the relationship between trust, contractual flexibility and cooperation.(4) Based on verified hypothesis, management inspiration was proposed, namely increasing trust to promote bilateral cooperation.