Assessing the implementation and effectiveness of China’s social credit system of the construction industry: a case study of Nanjing

Abstract

Construction contractor evaluation is the first step in ensuring the successful completion of a project. Nowadays, the Chinese government has developed a social credit system (SCS) and proposed contractors’ credit scores as an additional factor to facilitate bidding decisions. Using Nanjing as a case study, this article investigates the status quo of construction contractors’ credit scoring. It evaluates how credit scores have impacted the public procurement of construction projects. This article utilizes data-driven approaches and conducts different statistical analyses based on the bidding results of 15,094 public projects and the credit scores of over 6,000 registered construction companies from 2014 to 2021. The results show that (1) around half the companies had no credit-changing activities; (2) credit scores are important when companies are bidding for medium, large, and extra-large projects; (3) large companies are more likely to have better credit ratings; and (4) credit scores have a significant impact on revenue generation. This article provides a basis for understanding the status quo and effectiveness of the SCS implementation in the Chinese construction industry and evaluating its impact on the public procurement of construction projects, which are often concerns of researchers, policymakers, and industry practitioners.

Keywords:

• Public policy
• tender evaluation
• construction contractors
• social credit system

Disclosure statement

No potential conflict of interest was reported by the authors.

Data availability statement

The data supporting this study’s findings are available from the corresponding author upon reasonable request.

Additional information

Funding

The paper is sponsored by the Chinese Ministry of Housing and Urban-Rural Development Soft Science Research Project (No. 2022-R-048).