Forecasting the Investors’ Escalation of Commitment in PPP Project at Different Project Stages: A Regression Model Based on the Influence of Social Factors

Abstract

In the public-private partnership (PPP) project, social factors are an important reason that leads to the escalation of commitment (EOC) of investors. Firstly, the study identified ten social factors that influence investor’s EOC in PPP projects by literature review. Then, 126 valid data were collected by situational questionnaire, and regression models of social factors that influence investors’ EOC were built at different stages of project completion. Finally, the study constructed the probability model of the investors’ EOC in different stages. It is found that with the progress of the project, investors are more and more inclined to EOC. In different stages, the social factors that play a major role in the investors’ EOC are different. Probability models based on the influence of social factors have good prediction ability. The findings can help engineering managers predict the risk of investor’s EOC in advance and formulate preventive measures in different stages to promote the success of the project.

keywords:

• Public-Private Partnership
• Social Factors
• Escalation of Commitment
• Investor
• Probability Model

EMJ Focus Areas:

• Decision Making & Risk Management
• Program & Project Management

Acknowledgements

We thank the National Natural Science Foundation of China [grant number 71571149], and Doctoral fund project of Southwest University of Science and Technology [grant number: 22sx7105] for funding this research.

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Data Availability Statement

Some or all data, models, or code that support the findings of this study are available from the corresponding author upon reasonable request.

Additional information

Funding

The work was supported by the National Natural Science Foundation of China [71571149]; Doctoral fund project of Southwest University of Science and Technology [22sx7105].

Notes on contributors

Jiaqi Liu

Jiaqi Liu, PhD lecturer, School of Economics and Management, Southwest University of Science and Technology, Mianyang, Sichuan Province. Research areas mainly include project financing and risk management in PPP, organizational behavior. Current research interests also include information management and social network analysis. E-mail: [email protected].

Jicai Liu

Jicai Liu, PhD Professor/Head of Div. of Construction Management, School of Economics and Management, Southwest Jiaotong University. He is “Excellent Talents in the New Century” of the Ministry of Education, “Outstanding Experts with Outstanding Contributions in Sichuan Province”, etc. His research interest mainly covers project management, project financing, risk management, and organizational behavior. Some results had been published in Transportation Research Part A, International Journal of Project Management, Construction Management and Economics, etc. E-mail: [email protected].

Jun Hu

Hu Jun, master, School of Economics and Management, Southwest Jiaotong University, Chengdu, Sichuan Province. His research areas include project management. E-mail: [email protected].