MOC — Payment Mechanisms & Concepts
Map of Content — the analytical backbone of the vault: what the payment problem is and how it operates.
The thesis and its structure
- Construction Payment Problem — the central thesis the vault tests
- Construction Payment Pyramid — the tiered structure through which money flows and delay compounds
- Country Region Market — the comparative unit of analysis
- Conclusion — the direct answer to the research goal
The five mechanisms
- Global Subcontractor Payment Delays — money owed but not arrived
- Construction Payment Disputes — money contested
- Construction Retention Payments — money withheld by contractual design
- Pay-When-Paid Clauses — clauses that transmit payment risk down the chain
- Contractor Insolvency and Subcontractor Risk — where delay/withholding becomes permanent loss
Remedies and counter-measures
- Prompt Payment Legislation — statutes imposing payment timelines
- Construction Adjudication — fast interim-binding dispute remedy (most effective single tool)
- Mechanics Lien — the US property-claim payment-security mechanism
- Retention Trust and Project Bank Accounts — ring-fencing solutions
- Prompt Payment Code — voluntary code (a case study in why voluntary measures fail)
The honest counter-evidence
- Legitimate Withholding and Disputed Invoices — when withholding is lawful, and the line to abuse
- Supply Chain Finance and Reverse Factoring — finance tools that can mask debt and extend terms
- Late Payment in Developing Countries — the peer-reviewed academic evidence base
Key relations
Construction Payment Pyramid [causes] Global Subcontractor Payment Delays Pay-When-Paid Clauses [causes] Global Subcontractor Payment Delays Prompt Payment Legislation [opposes] Global Subcontractor Payment Delays Construction Adjudication [part-of] Prompt Payment Legislation Global Subcontractor Payment Delays [precedes] Contractor Insolvency and Subcontractor Risk Retention Trust and Project Bank Accounts [opposes] Contractor Insolvency and Subcontractor Risk
Open questions
- See
open_questions/construction-payment-problem-seed-questions.mdfor unresolved research threads, and the Conclusion for what the evidence does and does not settle.