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Evaluation framework of construction alternative dispute resolution methods through an integrated model of real options, probabilistic analysis and system dynamics

The construction industry plays a major role in the US economy and infrastructure project delivery, representing $878 billion or 8.6% of the national GDP in 2003 [CNN, 2003]. A critical characteristic of the construction industry, however, is the high costs incurred by the resolution of arising disputes in projects, reflecting the need for drastic improvement of dispute avoidance and resolution techniques (DARTs). The rapid development of DART since the 1990s has marked a new era in the construction industry, encouraging the various entities to shift from an adversarial system toward a collaborative atmosphere [ENR, 1994]. The purpose of this thesis is to provide a model, a methodology and a tool for understanding and evaluating the complex and dynamic interaction of conflicts and implemented DARTs on a project; and also, to develop quantitative methodologies for performing a cost-benefit analysis on a project in order to compare and select the most appropriate techniques to be applied to a project based on its characteristics.