Open AccessComponents of Cost Overrun in China Construction Projects
Author(s) -
Shaiful Amri Mansur,
Rosli Mohamad Zin,
Liu Linbo
Publication year - 2019
Publication title -
iop conference series. materials science and engineering
Language(s) - English
Resource type - Journals
eISSN - 1757-899X
pISSN - 1757-8981
DOI - 10.1088/1757-899x/620/1/012081
Subject(s) - cost overrun , china , business , cash flow , cost accounting , cost estimate , cost engineering , questionnaire , construction industry , productivity , cost control , operations management , labor cost , total cost , finance , risk analysis (engineering) , construction engineering , engineering , economics , accounting , economic growth , geography , management , mechanical engineering , social science , archaeology , sociology
This paper concerns an investigation into the causes of cost overrun in the construction industry of China. Cost overrun is common in all the countries of the world. For example, China has been experiencing severe cost overrun problem in the construction industry. The aim of the paper is to evaluate the major factors giving impact on cost components including labour, material, equipment and subcontractor. General factors that caused cost overrun in construction projects were obtained from literature review. The first questionnaire was designed to identify severity of factors for each cost component. The second questionnaire was designed to obtain the average proportions of cost components and cost of each top-ten factors for each cost component. The survey findings indicated that low productivity of labour, escalation of material prices, high cost of machineries and cash flow, and poor financial management are possible causes related to cost overrun in construction project of China as compared to other factors.