Mitigating dishonest conduct in engineering consulting projects under information asymmetry: an evolutionary game analysis based on prospect theory

Purpose The knowledge-intensive nature of the engineering consulting industry (ECI)1 makes it face more significant information asymmetry, which leads to dishonest conduct. This study aims to explore the internal mechanism of dishonest conduct under information asymmetry and how the government’s credit reward and punishment mechanism can alleviate the occurrence of dishonest conduct. By understanding the strategic choice mechanism of stakeholders, the study aims to propose effective credit supervision strategies. Design/methodology/approach This study combines the value perception of prospect theory with the dynamic equilibrium analysis of evolutionary game theory to establish a tripartite evolutionary game model among engineering consulting firms (ECFs), owners and the government. Select engineering cases in China and collect data through expert interviews and literature analysis. Findings The results show that ECFs exhibit risk-averse tendencies, and a critical threshold exists for their sensitivity to risk. Reputational losses and government reward and punishment mechanisms have a significant inhibitory effect on dishonest conduct. It is noted that punishment measures are more effective. The choice of government credit supervision strategies is not determined by a single factor but by the combined influence of its own credibility and the credit status of the industry. Originality/value This research provides a scientific basis for understanding dishonest conducts in the engineering consulting field under information asymmetry, filling the gap in existing research. It can provide suggestions for the government to build an accurate and effective credit supervision system, which helps to enhance industry transparency and promote healthy competition in the ECI.