Behavioral Strategies between Government and Real Estate Developers on Prefabricated Buildings Based on Triangular Fuzzy Matrix Game

The subsidies provided by the local government to real estate developers are an important and common practice to promote the development of prefabricated buildings worldwide. However, there is a lack of current research on how government subsidies affect the decision-making of real estate developers with respect to adopting prefabricated construction methods. This study developed a fuzzy game model integrating classical game theory with the triangular fuzzy number approach between the local government and a real estate developer, with different behavioral strategies regarding whether or not to develop prefabricated buildings. It analyzed the Nash equilibriums under the circumstances of pure and mixed strategies and probed the influencing factors of the game equilibrium results via numerical simulation. The research conclusions are as follows: (1) the government should encourage real estate developers to actively participate in prefabricated building by using financial subsidies, fund rewards, process supervision and economic penalties comprehensively; (2) the pure strategy (no manufacturing process supervision, active development) between the government and real estate developers is feasible when the benefit of “active development” for real estate developers is larger than that of “passive development”; (3) positive incentives, such as offering financial subsidies, reducing the cost of prefabricated building development and improving the popularity of prefabricated construction in the building market, should be taken to motivate real estate developers; and (4) negative incentives, such as increasing economic punishment and enhancing manufacturing process supervision, can also facilitate real estate developers to actively participate in the development of prefabricated buildings. Incentives are more effective when the economic penalties are greater than the incremental costs of developing prefabricated buildings. Some policy implications are given to guide prefabricated building market development. Finally, the main problems that need further study in the future are highlighted.

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