Factors Affecting Cost of Construction in the Construction Industry of Pakistan

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Cost escalation is one of the main concerns for project managers. It is a very industry. It is a major problem in both developing and developed countries but the trend is more severe in developing countries.

Large construction projects with their features of complexity and capital requirement have resulted interest to many researchers. Roachanakanan (2005) examined the causes and solution of cost escalation in Thailand and United States. He illustrated how the project cost control procedure used in United States can be applied to the construction industry in Thailand, so as to improve the procedure used by Thai contractor.

Salama et al. (2009) conducted a questionnaire survey in Dubai high-rise Building projects. They identified 23 factors for time & cost variation. Out of which, design changes, slow progress with respect to the schedule, fast track projects, the requirement are not well defined and explained for the design and scarcity of specialized subcontractor are the most common causes of cost and time variation. They recommended that to create more awareness among stakeholders, and especially among clients, regarding the importance of the initiation and planning phases of the project in order to cope with future variations.

Chang (2002) identified through 4 case project documents, the reasons for cost and schedule increase and further quantified their contributions to this problem for engineering design projects. These reasons were grouped into three headings: mainly within the owner’s control, mainly within the consultant’s control, and beyond either the owner’s or consultant’s control.

Flyvbjerg et al. (2004) conducted a significant study over the causes of cost escalation in transport infrastructure projects. The study is based on a sample of 258 rail, bridge, tunnel and road projects worth US$90 billion. The focus is on the dependence of cost escalation on: (1) the length of the project-implementation...
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