Beyond intentional trust: supplier opportunism and management control mechanisms in public sector procurement and contracting

Chris Lonsdale, Joe Sanderson, Glyn Watson and Fei Peng

MPRA Paper from University Library of Munich, Germany

Abstract: We test an argument, drawn from transaction cost economics, that an assumption of intentional trust should be replaced with one of supplier opportunism in public sector procurement and contract management. We use structural equation modelling to evaluate quantitative evidence from 180 public and private sector buyers on the perceived effectiveness of various management control mechanisms aimed at restraining supplier opportunism. Our findings suggest that supplier opportunism is potentially a problem and that certain procurement and contract management mechanisms can assist buying organisations in moderating that opportunism. This supports arguments in favour of a ‘cautious approach’ to procurement and contract management.

Keywords: procurement; contract management; intentional trust; opportunism (search for similar items in EconPapers)
JEL-codes: C38 D23 D86 (search for similar items in EconPapers)
Date: 2016-04
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:76094

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