Description
Book SynopsisThe construction of housing, commercial property and infrastructure projects – roads, bridges, tunnels, railways, airports – for both the private and public sectors is one of the biggest industries in the world. It contributes around 10 per cent of world GDP, employs 7 per cent of the global workforce, and consumes around 20 per cent of the world’s energy. It is also a highly fragmented industry with very low profit margins and a high risk of failure for the many firms operating in its complex supply chain.
Stephen Gruneberg and Noble Francis present an up-to-date analysis of how construction markets operate, how firms collaborate on projects, and how their business models work. They explore the many distinctive features of the economics of the industry, such as the use of cost-reduction rather than profit-maximizing behaviour, the processes of tendering and procurement, and the often cyclical nature of demand. Particular challenges for the industry, such as the frequency of disputes between firms and the low productivity of the sector, are shown to be the outcomes of a business model that tends to focus on the volatility of demand and managing risk at the expense of improving efficiency. As well as discussing industry-wide issues, the authors also examine how individual projects are costed.
The book offers authoritative analysis and expert insight into the economics of a much misunderstood industry and is suitable for a range of courses in business schools and departments of architecture and the built environment.
Table of Contents1. Getting to grips with construction industry statistics2. Economic theory of markets and construction3. Running a construction firm4. The firm and economies of growth5. Productivity and the construction market6. The game of construction7. The underlying causes of conflict in construction8. Construction and cyclicality9. Projects10. The economics of construction project management
