Transaction Costs Of Construction Project Bidding Control

Tendering & bidding, as a popular mode of transaction applied in market economy, has been widely operated in our construction and achieved remarkably effects, owning to its vivid characteristics of rightfulness, fairness openness. It has been recognized that tendering & bidding plays a positive role in improving economic order and promoting investment benefit, however, the issue of transaction cost in tendering & bidding for construction projects (TCTBCP) has not got sufficient attention. Therefore, in the context of establishing the economized society and pursuing the strategy of sustainable development, it is quite necessary to carry out research on how to manage the TCTBCP so as to standardize tendering & bidding activities.Firstly, using basic hypothesis of the new institutional economics, this paper investigates the forming reason of transaction cost in construction engineering and starting from the features of which, it also provides a definition of TCTBCP as well as analyzes its formation and characteristics by borrowing some relevant theories from Transaction Cost Economics; next, detailed analysis is carried out to the cost drivers of TCTBCP, namely, institutional cost, tendering cost and bidding cost to establish a cost system on TCTBCP; Finally, three principles:the principle of tendering & bidding effect optimality, of overall cost control and of government dominance are put forward for the control of TCTBCP; under the guidance of which, the realization of TCTBCP is elaborated from the aspects of incentive mechanism, monitoring mechanism and decision-making choice; and suggestions are proposed respectively to the key points (tendering & bidding system, the establishment of tendering & bidding credit system, tendering & bidding information releasing and qualification examination) during the control process of TCTBCP.In this paper, combined with the actual practice, research has been carried on TCTBCP, the outcome of which hopefully will make some reference contributions to the relevant participants in the construction projects.