Five Forces Analysis of the Swedish Construction Industry Essay

1265 Words May 1st, 2012 6 Pages
Five Forces analysis of the Construction Industry in Sweden

“The authors conclude that the less competitive a market environment, the higher will be the amount of corruption by giving public servants the incentive to extract some of the monopoly rents through bribes.” (Lambsdorf, 1999)

Industry background:

The Swedish construction business consists of four main actors namely JM, NCC, PEAB and Skanska that historically have had exclusive rights to bid on large-scale governmental projects. This is not a result of corruptive and lobbying activities but rather a result of the sheer size and financial budgets of these projects and firms with the ability to finance them. (Hådell and Uveborn, 2004). This in terms cause extensive
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The recently recognized corruption cases caught the general public by surprise and have since been widely discussed because the general perception was that these under the table sort of affairs did not occur in Sweden (TH 2012).

Conclusion

The aftermath of the Gothenburg cases is still too early to see, and the reasons behind them vary from friendly connections to personal greed. But an intriguing issue is that the fight for survival because of the extensive competitiveness of the market for these medium- to small-sized firms could be considered as a potential reason for some actors to turn towards corruptive behaviour.
Doing this without neglecting the fact that the construction industry has had its fair share of corruption tendencies all over the world as well as old habits of giving and accepting gifts as a token of doing business together.

References

Dr. Lambsdorff, J. G., 1999, “Corruption in Empirical Research – A Review”, available at: http://gwdu05.gwdg.de/~uwvw/downloads/contribution05_lambsdorff.pdf; accessed April 23, 2012

Hådell, A. and Uveborn, J. 2004, “Strategic Analysis Based on the Swedish Construction Industry: A Survey on JM, NCC, PEAB AND SKANSKA”, available at: http://liu.diva-portal.org/smash/record.jsf?pid=diva2:19126; accessed April 23, 2012

Swedish Competition Authority (SCA), 2011,

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