IDEAS home Printed from https://ideas.repec.org/a/gam/jmathe/v9y2021i22p2940-d681897.html

Research on Extreme Dispute Decisions of Large-Scale Engineering Projects from the Perspective of Multidimensional Preferences

Author

Listed:
  • Ren Tan

    (Business School, Central South University, Changsha 410083, China)

  • Kairong Hong

    (Business School, Central South University, Changsha 410083, China)

Abstract

The main purpose of this paper is to study the influence of game players’ behavior preferences on the strategy choice and equilibrium results in the game process of large-scale engineering projects’ extreme disputes. In contrast to the self-interested preference and completely rational assumptions of traditional economics, this paper focuses on the discussion of loss aversion preference and fairness preference against the background of incomplete information about the game subject. Considering the influence of the decision-makers’ multidimensional preferences, this paper establishes a three-party game model for the government, the project construction units, and the public. Furthermore, the equilibrium results of four different types of extreme disputes are deduced using the game method. We deduce the evolutionary paths and equilibrium characteristics and discuss them in combination with actual cases in China in an attempt to provide theoretical support and scientific analysis tools to avoid serious disputes and conflict decision results. Through research, this paper finds that the transformation of prior beliefs, the role of multidimensional preference sets, and a lack of information between the game players in the game process are key to the evolution of project disputes into extreme dispute decisions.

Suggested Citation

  • Ren Tan & Kairong Hong, 2021. "Research on Extreme Dispute Decisions of Large-Scale Engineering Projects from the Perspective of Multidimensional Preferences," Mathematics, MDPI, vol. 9(22), pages 1-24, November.
    • Handle: RePEc:gam:jmathe:v:9:y:2021:i:22:p:2940-:d:681897
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2227-7390/9/22/2940/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2227-7390/9/22/2940/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Zhengqi He & Dechun Huang & Junmin Fang & Bo Wang, 2020. "Stakeholder Conflict Amplification of Large-Scale Engineering Projects in China: An Evolutionary Game Model on Complex Networks," Complexity, Hindawi, vol. 2020, pages 1-17, August.
    2. Sandeep Baliga & Tomas Sjostrom, 2012. "The Strategy of Manipulating Conflict," American Economic Review, American Economic Association, vol. 102(6), pages 2897-2922, October.
    3. Kreps, David M., 1990. "Game Theory and Economic Modelling," OUP Catalogue, Oxford University Press, number 9780198283812.
    4. Shalev, Jonathan, 1997. "Loss aversion in a multi-period model," Mathematical Social Sciences, Elsevier, vol. 33(3), pages 203-226, June.
    5. Houba, Harold & Wen, Quan, 2011. "Extreme equilibria in the negotiation model with different time preferences," Games and Economic Behavior, Elsevier, vol. 73(2), pages 507-516.
    6. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    7. Tversky, Amos & Kahneman, Daniel, 1992. "Advances in Prospect Theory: Cumulative Representation of Uncertainty," Journal of Risk and Uncertainty, Springer, vol. 5(4), pages 297-323, October.
    8. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory of Fairness, Competition, and Cooperation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(3), pages 817-868.
    9. Milch, Kerry F. & Weber, Elke U. & Appelt, Kirstin C. & Handgraaf, Michel J.J. & Krantz, David H., 2009. "From individual preference construction to group decisions: Framing effects and group processes," Organizational Behavior and Human Decision Processes, Elsevier, vol. 108(2), pages 242-255, March.
    10. M. Wanous & A. H. Boussabaine & J. Lewis, 2000. "To bid or not to bid: a parametric solution," Construction Management and Economics, Taylor & Francis Journals, vol. 18(4), pages 457-466.
    11. Jonathan Shalev, 2000. "Loss aversion equilibrium," International Journal of Game Theory, Springer;Game Theory Society, vol. 29(2), pages 269-287.
    12. Attanasi, Giuseppe & Battigalli, Pierpaolo & Manzoni, Elena & Nagel, Rosemarie, 2019. "Belief-dependent preferences and reputation: Experimental analysis of a repeated trust game," Journal of Economic Behavior & Organization, Elsevier, vol. 167(C), pages 341-360.
    13. Appelbaum, Elie, 2008. "Extremism as a strategic tool in conflicts," Journal of Economic Behavior & Organization, Elsevier, vol. 68(2), pages 352-364, November.
    14. Charles Kenny, 2009. "Measuring Corruption in Infrastructure: Evidence from Transition and Developing Countries," Journal of Development Studies, Taylor & Francis Journals, vol. 45(3), pages 314-332.
    15. Colin Camerer, 1998. "Bounded Rationality in Individual Decision Making," Experimental Economics, Springer;Economic Science Association, vol. 1(2), pages 163-183, September.
    16. Rabin, Matthew, 1993. "Incorporating Fairness into Game Theory and Economics," American Economic Review, American Economic Association, vol. 83(5), pages 1281-1302, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhaoyu Cao & Xu Zhao & Yucheng Zou & Kairong Hong & Yanwei Zhang, 2021. "Multidimensional Fair Fuzzy Equilibrium Evaluation of Housing Expropriation Compensation from the Perspective of Behavioral Preference: A Case Study from China," Mathematics, MDPI, vol. 9(6), pages 1-22, March.
    2. Zhaoyu Cao & Yucheng Zou & Xu Zhao & Kairong Hong & Yanwei Zhang, 2021. "Multidimensional Fairness Equilibrium Evaluation of Urban Housing Expropriation Compensation Based on VIKOR," Mathematics, MDPI, vol. 9(4), pages 1-26, February.
    3. Sawa, Ryoji & Wu, Jiabin, 2018. "Prospect dynamics and loss dominance," Games and Economic Behavior, Elsevier, vol. 112(C), pages 98-124.
    4. SHALEV, Jonathan, 1998. "Loss aversion in repeated games," LIDAM Discussion Papers CORE 1998014, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    5. Stefano DellaVigna, 2009. "Psychology and Economics: Evidence from the Field," Journal of Economic Literature, American Economic Association, vol. 47(2), pages 315-372, June.
    6. Miklós Antal & Ardjan Gazheli & Jeroen C.J.M. van den Bergh, 2012. "Behavioural Foundations of Sustainability Transitions. WWWforEurope Working Paper No. 3," WIFO Studies, WIFO, number 46424.
    7. Dorian Jullien, 2018. "Under Risk, Over Time, Regarding Other People: Language and Rationality within Three Dimensions," Research in the History of Economic Thought and Methodology, in: Including a Symposium on Latin American Monetary Thought: Two Centuries in Search of Originality, volume 36, pages 119-155, Emerald Group Publishing Limited.
    8. Ulrich Schmidt & Horst Zank, 2012. "A genuine foundation for prospect theory," Journal of Risk and Uncertainty, Springer, vol. 45(2), pages 97-113, October.
    9. Croson, Rachel & Gächter, Simon, 2010. "The science of experimental economics," Journal of Economic Behavior & Organization, Elsevier, vol. 73(1), pages 122-131, January.
    10. Schade, Christian & Schroeder, Andreas & Krause, Kai Oliver, 2010. "Coordination after gains and losses: Is prospect theory’s value function predictive for games?," Structural Change in Agriculture/Strukturwandel im Agrarsektor (SiAg) Working Papers 59524, Humboldt University Berlin, Department of Agricultural Economics.
    11. Chakravarthi Narasimhan & Chuan He & Eric Anderson & Lyle Brenner & Preyas Desai & Dmitri Kuksov & Paul Messinger & Sridhar Moorthy & Joseph Nunes & Yuval Rottenstreich & Richard Staelin & George Wu &, 2005. "Incorporating Behavioral Anomalies in Strategic Models," Marketing Letters, Springer, vol. 16(3), pages 361-373, December.
    12. William S. Neilson, 2000. "Victory and Defeat in a Model of Behavior in Games and Toward Risk," Econometric Society World Congress 2000 Contributed Papers 0690, Econometric Society.
    13. Teck H. Ho & Noah Lim & Colin Camerer, 2005. "Modeling the Psychology of Consumer and Firm Behavior with Behavioral Economics," Levine's Bibliography 784828000000000476, UCLA Department of Economics.
    14. Marie-Laure Cabon-Dhersin & Nathalie Etchart-Vincent, 2012. "The puzzle of cooperation in a game of chicken: an experimental study," Theory and Decision, Springer, vol. 72(1), pages 65-87, January.
    15. Eduard Marinov, 2017. "The 2017 Nobel Prize in Economics," Economic Thought journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 6, pages 117-159.
    16. König, Clemens, 2013. "Net-Loss Reciprocation and the Context Dependency of Economic Choices," Discussion Papers in Economics 17474, University of Munich, Department of Economics.
    17. Döring Thomas, 2013. "John Maynard Keynes als Verhaltensökonom – illustriert anhand seiner Analyse des Versailler Vertrags / John Maynard Keynes as Behavioral Economist – Represented by his Analysis of the Treaty of Versailles," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 64(1), pages 27-52, January.
    18. Nobel Prize Committee, 2017. "Richard H. Thaler: Integrating Economics with Psychology," Nobel Prize in Economics documents 2017-1, Nobel Prize Committee.
    19. Fongoni, Marco & Dickson, Alex, 2015. "A Theory of Wage Setting Behavior," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 2015-57, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    20. Brown, Gordon D. A. & Gardner, Jonathan & Oswald, Andrew J. & Qian, Jing, 2005. "Does Wage Rank Affect Employees' Wellbeing?," IZA Discussion Papers 1505, IZA Network @ LISER.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jmathe:v:9:y:2021:i:22:p:2940-:d:681897. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager The email address of this maintainer does not seem to be valid anymore. Please ask MDPI Indexing Manager to update the entry or send us the correct address (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.