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International comparisons of cost and productivity in construction: a bad example

Construction Economics and Building

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Title International comparisons of cost and productivity in construction: a bad example
 
Creator Best, Rick
 
Subject Construction
International comparisons, construction costs, purchasing power parities, productivity
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Description In a report published in June 2012 the Business Council of Australia (BCA) reported that it costs considerably more to build a variety of types of infrastructure in Australia than it does in the US. Airports (90% more costly) and hospitals (62%) were quoted as the worst cases with other projects ranging from 26% to 43% more. They used these figures to conclude that Australia is a high cost, low productivity environment for building infrastructure projects. These claims were based on cost/m2 figures published by a major international construction consultancy. The method used by the BCA is flawed in two ways: one is the in the use of costs that are recognised as giving only the broadest of indications of probable costs and the second is the use of exchange rates to convert Australian construction costs to US dollars. Careful analysis of the methodology used, supported by a series of other comparisons based on other data sources and other conversion factors (purchasing power parities or PPPs), suggests that in real terms it probably costs no more to build in Australia than it does in the US and that it may well be cheaper to build in Australia than it is in the US.
 
Publisher UTS ePRESS
 
Contributor —
 
Date 2012-09-11
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer reviewed invited commentry
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Format application/pdf
 
Identifier http://epress.lib.uts.edu.au/journals/index.php/AJCEB/article/view/2662
10.5130/AJCEB.v12i3.2662
 
Source Construction Economics and Building; Vol 12, No 3 (2012): AJCEB; 82-88
2204-9029
 
Language eng
 
Relation http://epress.lib.uts.edu.au/journals/index.php/AJCEB/article/view/2662/2936
 
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Rights Copyright (c) 2012 Rick Best
http://creativecommons.org/licenses/by/4.0