Changes in profit as market conditions change: An historical study of a building firm

Chan Siu Ming, Göran Runeson, Martin Skitmore

Research output: Contribution to journalArticleResearchpeer-review

18 Citations (Scopus)

Abstract

This paper analyses the profits from 221 construction projects undertaken by an Australian building firm in the period 1910-1938 and examines the factors that influence the firm's profit levels. This involves a series of multiple regression analyses with three dependent variables representing profit and 26 independent variables representing economic conditions and project characteristics. From these, 11 models are derived of which two are chosen as having the best explanatory power in explaining approximately 72% of the variability in profit levels movements. The results show that unemployment, interest rates, level of construction activity in the state, change of wage level, inflation rate of building material and project value significantly influenced the firm's profit level during the period.

Original languageEnglish
Pages (from-to)253-264
Number of pages12
JournalConstruction Management and Economics
Volume14
Issue number3
DOIs
Publication statusPublished - May 1996
Externally publishedYes

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