How does contract flexibility affect the sustainability performance of public–private partnership projects? A serial multiple mediator model

Abstract

PurposeThe risks and uncertainties of public–private partnership (PPP) projects threaten their sustainability. Contract flexibility, which is based on the theory of incomplete contract and transaction cost, may be a viable solution to this issue. The purpose of this study is to investigate the relationship between contract flexibility and the sustainability performance of PPP projects. The multiple mediating roles of justice perception and cooperation efficiency are assessed, thereby allowing the pathways and conditions to be understood more comprehensively for improving the sustainability performance of PPP projects.Design/methodology/approachNine hypotheses in the proposed research model are tested via structural equation modeling using data acquired from 218 Chinese PPP professionals.FindingsResults show that contract flexibility positively affects PPP project sustainability performance. Justice perception and cooperation efficiency play direct and sequential mediating roles in this effect.Originality/valueThis study validates that contract flexibility positively impacts the sustainability performance of PPP projects, where justice perception and cooperation efficiency serve direct and sequential mediating roles. The findings of this study contribute to an improved understanding of the effect of contract flexibility on the sustainability performance of PPP projects. Furthermore, they provide important theoretical and practical insights into contract management as well as beneficial information and valuable initiatives for improving the sustainability of PPP projects.