published_or_final_version / Real Estate and Construction / Doctoral / Doctor of Philosophy

published_or_final_version / Civil Engineering / Doctoral / Doctor of Philosophy

The construction sector serves as the engine of growth to the South Africa economy because of its catalytic role in the growth and development of the country. This study focuses mainly on the influence of the macro-economic environment on the contribution of the private sector to construction in the South Africa economy from 1984 to 2011. Government construction work is considered to be an injection into the economy; in this regard, state construction is regarded as public investment in the economy; and therefore, it is anti-cyclic (Keynes, 1936). The aim of this study has been to develop an econometric model for predicting the influence of the macroeconomic environment on the contribution of the private sector to the construction sector in the South Africa economy. The research design adopted in this study was an “ex-post facto” type, otherwise known as a causal-comparative design. The data were extracted from the published sources of the South African National Statistics, namely SARB, Stats SA and Quantec SA. The estimation technique used in this study was the ARDL model using quarterly data from 1984 to 2011. This is because in the construction sector, the influence of the independent variables is always felt over time – rather than all at once. The results of this study show that there is a long run causal relationship between inflation rate, interest rate, real exchange rate, GDP and gdp in the construction sector. The descriptive statistical analysis shows that there is a negative relationship between variables inflation rate and interest rate and the private sector spending in construction. However, economic growth as well as growth in the construction sector has a positive relationship with the private sector spending in construction. Likewise, the real exchange rate and labour productivity in construction have a negative relationship with the private sector’s spending in construction and they are statistically insignificant. The variance decomposition analysis show that the private sector spending in construction explains about 75 per cent of it variations, followed by inflation rate that explains 21 per cent on the average; while the remaining variations, comprising about 4 per cent, were shared among the other independent variables, such as GDP, GDP in construction, the interest rate and the real exchange rate. It was discovered that only the inflation rate does Granger-cause the private sector spending in construction. From the finding it can be concluded that inflation rate is a significant explanatory variable in explaining the variation in the dependent variable during period under review. Policy recommendations are as follows: firstly, the monetary authorities in South Africa should embark on sound policies that would bring about low prices of the construction materials. This would ensure growth and development in the construction sector; secondly, a stimulating development plan that would encourage private sector investment in properties and infrastructural development must be instituted; thirdly, an alternative policy to the present inflation targeting is recommended that would bring about low inflation, high growth, low unemployment and stable exchange rate; fourthly, the present policy on interest rate must be reviewed to allow for more participation in construction projects by the private sectors of the economy; fifthly, due to the fact that fluctuation in the crude oil prices in the international market is one of the major factors causing high inflation rate in South Africa, government must source local alternative products that would bring down prices of construction materials.

Thesis. 1975. M.S.--Massachusetts Institute of Technology. Dept. of Civil Engineering. / Bibliography: leaves 114-116. / by Elias Nicolas Hani and Yves Lesage. / M.S.

The construction industry is a complex, multi-level system that includes a large collection of independent, heterogeneous organizations and institutions and is associated with several economic sectors and markets. Because of its unique characteristics, the construction industry as one of the major economic sectors and contributors to the economic development of the nation needs its own specific and dedicated economics. The shortcomings of the existing methodologies call for the use of more sophisticated modeling tools that can capture more important aspects of the real world and its complexity in particular the interconnections among elements of the system, their idiosyncrasies, and emergent behavior. As a pioneer attempt in the exploration of a new theory of construction economics, this study aims to found the first building blocks of the comprehensive economic model of the construction industry. In this dissertation, an agent-based approach is applied to model the low-bid lump-sum construction competitive bidding by which most construction works are allocated. This model has several advantages over the previous analytical and empirical models including the capability of observing the bidding process dynamics, the interaction between the heterogeneous and learning agents, and the emergent bidding patterns arising from multiple scenarios of market conditions and contractors’ attributes. Then the model is used as a virtual laboratory for conducting a variety of experiments to answer several important research questions in the field of construction economics. The main research objectives of this study are to: (1) analyze the effectiveness of major quantitative methods in the bidding environment under a variety of market conditions (2) study the effect of contractors’ risk behavior, cost estimating and project management skills, and complexity of projects on contractors’ choice of optimal markup, long-term financial growth and market share (3) investigate the impact of risk behavior and need for work on contractors’ performance. The results presented in this dissertation offer new understandings and insights on the construction bidding environment and recommendations for both owners and contractors’ competitive success, which are not available using conventional approaches. In particular, results suggest that (1) using Friedman model can result in considerably higher market share whereas using Gates model can result in higher profit per project, (2) the optimal policy for contractors is moderation in both dimensions of risk attitude and need for work, (3) the comparative performance of slightly and extremely risk averse contractors are depending on level of cost estimating accuracy and project execution skills of contractors as well as the level of project complexities.

Less than two decades ago, Zimbabwe was a symbol for the rest of the world of what Africa could become (Dell, 2005). DiSilvio (2007) contends that independent Zimbabwe was an economic success on route to attaining status of the most “developed country” in Africa. Contrary to expectations, by 2003 the Zimbabwean economy was shrinking faster than any other economy in the world at 18 percent per year (Richardson, 2005). Reports indicate that the Zimbabwean economy is in crisis and has since been set back by more than 50 years (Matikinye, 2005). This phenomenon necessitated the need for an investigation to ascertain its cause in Zimbabwe. As a result, the research identifies and presents hyperinflation as the root cause of the crisis in Zimbabwe and illustrates the validity of this assertion with a focus on the Zimbabwean construction industry. As part of the research inquiry, a review of related literature was conducted. The literature review illustrated the generic effects of hyperinflation as well as the effects of this phenomenon in action in Zimbabwe. The literature study was followed by a questionnaire survey. The questionnaire was completed by 23 contractors and 7 clients from a census of contractors and clients in Zimbabwe. The questionnaire consisted of a number of variables, which the respondents were asked to rate vis-à-vis the effects of hyperinflation in the construction industry. In summary, the questionnaire sought to determine the causes of hyperinflation in Zimbabwe, its specific effects on the construction industry and how respondents thought the phenomenon could be mitigated so as to revive the Zimbabwean construction industry. The techniques of re-scaling, in conjunction with descriptive and inferential statistics, ranking and quadrant analysis were applied to the data. Results from these analyses revealed a high degree of agreement among respondents vis-à-vis the effects of hyperinflation on the Zimbabwean construction industry. The interpretation of the results further revealed that hyperinflation has undoubtedly led to the collapse of the Zimbabwean construction industry. In conclusion, the research, applying the interpretations of v the survey findings, prescribes a number of ways in which the Zimbabwean construction sector may be resurrected. Among the recommended prescriptions, there are a number of debatable issues that arise that the researcher proposes should be subject to future study.

M.Tech. (Construction Management) / The construction industry is a key sector in the development and economic growth of South Africa. However, the industry has not escaped the challenges facing other countries worldwide in terms of delivering construction projects within budget and on time as stipulated in the contracts. This study assesses the causes, effects and measures of minimising construction projects cost and schedule overruns in the Gauteng Province of South Africa. The data used in this study were derived from both primary and secondary sources. The secondary data was collected via detailed review of related literature. The primary data was collected through a questionnaire which was distributed to construction professionals. Out of the 200 questionnaires sent out, 146 were received representing a 73% response rate. Findings revealed that inadequate planning, change in project design, poor project management, inadequate financial provision and inaccurate estimates were the major causes of construction projects cost overruns. Furthermore the study also showed that the causes of construction projects schedule overruns in Gauteng province included: slowness in decision making process, reworks due to errors during construction, delays in approving major changes in the scope of work, delay in material delivery, shortage of skilled equipment operators and low productivity level of workers. Additionally, it was observed that construction project delays, increased project cost due to extension of time, liability of companies to bad debt and project abandonment. The study also revealed that extension of time, cost overruns, loss of profit, disputes and poor quality of work due to hurrying the project were the major effects of construction projects schedule overruns. Likewise, the study revealed that adequate planning, proper pre-contract planning, proper project implementation and management and good workmanship were the most effective ways of minimising construction projects cost overruns. Finally the results revealed that proper project planning and scheduling, effective strategic planning, site management and supervision, frequent coordination between the construction team, availability of clear information and communication channels were the most effective ways of minimising construction projects schedule overruns in the Gauteng Province of South Africa. It is recommended that all members of construction teams be trained and educated of the factors that cause project cost and schedule overruns in order to minimise these overruns.

published_or_final_version / Real Estate and Construction / Doctoral / Doctor of Philosophy

Construction delays are a global phenomenon. Factors causing construction delays in construction projects differ from country to country, due to different prevailing conditions. The prevailing conditions that could exert an influence on project delivery time are: political, economic, and physical factors as well as level of technological development; management style, and construction techniques. The construction industry is a major player in the economy, generating both employment and wealth. However, many projects experience extensive delays and thereby exceed initial time and cost estimates. This study aims at determining the causes of delays in project delivery in South Africa; evolving interventions, and developing a model for the delivery of projects on time. Inferential and linear regression statistical tools were used in the analysis of data for the study. The sample population consists of architects, builders, quantity surveyors, structural engineers, and clients, and the metropolitan cities of five provinces constituted the geographical delimitation of the study. The provinces are: Eastern Cape; Free State; Gauteng; KwaZulu-Natal, and Western Cape. The metropolitan cities are: Bloemfontein; Cape Town; Durban; Johannesburg, and Port Elizabeth. Findings which negatively influence project delivery time in South Africa include the following: lack of adequate planning; management style; the lack of constructability reviews of designs; inadequate motivation of workers; economic policies; lack of prompt payment to contractors, and quality of management during design and construction. Recommendations include: (1) The introduction of the following courses in built environment tertiary education � quality management competences; operational planning; design management, and generic management; (2) pre-qualification of suppliers; (3) inclusion of the following in tender documentation � human resource schedule; plant and equipment schedule; quality assurance plan, and work schedule; (4) appointment of materials specialists on a large projects; (5) the model developed should be adopted for use in the South African construction industry for the delivery of projects on time, and (6) the linear regression equation: Y = 13.1159 + 1.1341x or 35.3 percent addition on time for the estimation of project delivery time.