Comparison Of DB Model And EPC Model Based On The Theory Of Transaction Cost

With China’s accession to the WTO,the domestic construction market is further in line with international standards. Construction engineering and Management are increasingly to be more modernization. The traditional contract mode is not only difficult to satisfy the requirements of professional management, but also not conducive to reduce the risk or transfer the investment. In recent years, general contracting mode has been great developing in our country, adding to a number of policies and regulations the state has issued to promote and standardize this contract model. The key of such a development and promotion in general contracting model lies in its traditional superiorities, contrasting to the traditional one. One of them is to save the transaction cost of general contracting firms.DB model and EPC model are the two most common forms of the project general contracting model at present. In accordance with the contract, they contact the whole process of project, including the design, procurement, construction and commissioning. However, they two differ in the institutional arrangements of the range of application, characteristics, form of tender and others, which leads to the difference between transaction cost.This paper has been analyzed and compared the DB model and EPC model from the perspective of transaction cost. It has enhanced the mutual understanding of these two kinds of models, to understand more comprehensively and apply them to practice. First of all,this paper has reviewed related literature at home and abroad, analyzing the related conceptions of general contracting model and theories of transaction cost. On the basis of that, it has studied the transaction process of DB model and EPC model establishing decomposition structure of DB model and EPC model on transaction cost. According to the construction program of transaction cost, it consists of4categories and34items. Besides, it has also analyzed opportunistic transaction cost for each stage, and compared the cost decomposition between DB model and EPC model.After that, the evaluation model about transaction cost has been established in this paper, which is the integrated use of analytic hierarchy process method and TOPSIS method. They can be effective for measuring transaction costs. At the same time, in order to ensure the accuracy of transaction cost evaluation, this paper has also assumed transaction cost evaluation and decision support system DSS, which makes full use of the accumulation of empirical data and provides decision support for the proposed project in practice,so that it will be more accurate to select contract model.