Uncertainty and construction projects: A new institutional economics perspective

This article takes the construction project as an adaptation mechanism to uncertainty. In the light of the principles of new institutional economics, the uncertainty caused by information shortage is taken as the main reason for the existence of construction projects, and the complexity of the project itself and the stability of market demand are key factors that affect the uncertainty of projects. An analytical framework is developed. And four governance patterns of the construction project are presented based on the analysis of different combinations between the complexity of the project and the stability of market demand. It is concluded that researches on uncertainty are theoretical bases of project governance.