A Study on the Role of Opportunism Forms in Increasing Stakeholder Satisfaction in PPP Projects Using Transaction Cost Economics Theory

Abstract

Defined as self-interest seeking with guile, opportunism is believed to always be reduced. Extant research has mainly focused on how to predict and control opportunism from a dyadic perspective. However, there is a relative paucity of empirical research focusing on opportunism consequences. Meanwhile, there are conflicting understandings from limited research on the consequences of opportunism in social science. These conflicting understandings could be because the discourse has not progressed, in terms of forms of opportunism and the effects of these different forms.

With the guidance of Transaction cost economics (TCE), this research initially classified opportunism under the 3C-Dimensions of Character, Circumstances and Conduct dimensions. This research then thoroughly examined the consequences of the eight forms of opportunism generated from the three dimensions to explore whether all forms of opportunism result in negative consequences. This study used an exploratory sequential mixed methods that started with a qualitative approach followed by a quantitative approach. In the qualitative phase, 24 semi-structured interviews with key stakeholders involved in PPP projects were conducted. This assisted in development of scales of opportunism in various forms through the refinement of the item list generated from extant research. In the quantitative phase, a web-based survey was used to test the research framework to help answer two research questions: 1) Do all forms of opportunism result in negative consequences? and 2) How will these consequences change under a different context?

This study identified that not all forms of opportunism result in negative consequences in PPP projects. It was also found that when the level of innovation climate is low there are even forms of opportunism that can improve stakeholder satisfaction. Innovation climate tends to influence the consequence of certain forms of opportunism. In general, it can be concluded that innovation climate affects the consequences of private opportunism more than public opportunism, active opportunism more than passive opportunism, and opportunism under existing circumstances more than opportunism under new circumstances.