Evaluation of cost efficiency and influencing factors of construction firms using stochastic frontier approach

• Main Authors: Wu, Jih-Shong, 吳繼熊
• Other Authors: Dzeng, Ren-Jye
• Format: Others
• Language: zh-TW
• Published: 2013
• Online Access: http://ndltd.ncl.edu.tw/handle/48299374439027599741

博士 === 國立交通大學 === 土木工程系所 === 101 === Construction firms require a large cash flow, thereby creating a significant financial leverage. Therefore, identifying a highly effective cost efficiency model is essential for construction firms, especially under the pressure of competition in today's global market. In this study, 26 Taiwan listed construction companies are examined using the Stochastic Frontier Analysis (SFA). By using the regression model and the translog cost function to evaluate the cost inefficiency, equipment cost, and firm scale. The main findings include: (1) the cost efficiency showed that there was still a room for improvement, (2) appropriate financial leverage increases cost efficiency and capital, (3) subcontracting reduces labour costs, (4) larger firms can be more cost efficient, (5) reducing equipment costs increases cost efficiency, and (6) real estate developers are more cost efficiency. It is hoped that through the findings of this study, we can help construction firms to strategically adjust the management of their firm and improve cost efficiency.