Transaction Costs for Design-Build-Finance-Maintain Contracts

R. Favie, W.A. Beelen, G.J. Maas

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Abstract

This paper gives insight in how transaction costs arise and how in theory transaction costs can be reduced. A comparison between theory and practice has been made. A study of a case in the Netherlands, the Second Coentunnel showed how transaction costs in practice appear, in which stage of the purchasing process these cost arise and also how transaction costs can be reduced. Cost specifications, handed by the public and private parties, make clear that in every phase of the process the client makes expenses. The client spends the most money during the initiative phase. The private parties start making costs in the first phase of the tender (prequalification). For contractors the most expensive phase is the dialogue phase. Taking all the costs in overview, noticeable is that all of the costs are related to the duration of the different phases of the process and required capacity of personnel. Success factors from theory and practice have been identified in the process in which transaction costs arise. Theory and practice have been compared and resulted in a list of twelve success factors. By implementing these success factors in future projects the expectation is that transaction costs will not be unnecessary high.
Original languageEnglish
Title of host publicationCIB Joint International Symposium: Construction Facing Worldwide Challenges
EditorsA. Ceric, M. Radujkovic
Place of PublicationDubrovnik
PublisherInternational Council for Research and Innovation in Building and Construction (CIB)
Pages1-7
Publication statusPublished - 2009
Eventconference; CIB Joint International Symposium: Construction Facing Worldwide Challenges; 2009-09-27; 2009-10-01 -
Duration: 27 Sep 20091 Oct 2009

Conference

Conferenceconference; CIB Joint International Symposium: Construction Facing Worldwide Challenges; 2009-09-27; 2009-10-01
Period27/09/091/10/09
OtherCIB Joint International Symposium: Construction Facing Worldwide Challenges

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