Comparative research between the Chinese and the Australian construction industries based on productivity and industrial competitiveness

Zhang, P 2015, Comparative research between the Chinese and the Australian construction industries based on productivity and industrial competitiveness, Doctor of Philosophy (PhD), Property Construction and Project Management, RMIT University.


Document type: Thesis
Collection: Theses

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Title Comparative research between the Chinese and the Australian construction industries based on productivity and industrial competitiveness
Author(s) Zhang, P
Year 2015
Abstract In the last three decades, the Chinese construction industry has made significant achievements in the international market. Performance improvement of the Chinese construction industry in the international market is a widely held concern for academics, industry practitioners and policymakers in China. The performance gap between the Chinese and developed countries’ construction industries may still exist and it is important that we analyse this to improve industry performance and to assist policymakers formulate future development strategies. This research aims to understand the performance of the Chinese construction industry and generate strategies for future development by comparing the Chinese and the Australian construction industries based on the concepts of productivity and industrial competitiveness. The current measurement methods for a country, industry, and/or a firm’s status or level in the world are questionable.

This study adapted the International Advanced Index (IAI) to measure the status and level of a country’s construction industry in the international market. Porter's Diamond Model is one of the most popular and complete competitiveness theories and it has been improved by various scholars since it was first introduced. However, another very important theme that could contribute to this area of competitiveness is the concept of sustainable development. The research on the relationship between industrial competitiveness and sustainable development is lacking. Building upon the previous research, the Internationalisation Sustainable Development Competitiveness Model (ISDC Model) was generated to enable the evaluation of industrial competitiveness. Sustainable development is a new element and it is composed of three sub-elements including economic sustainability, social sustainability and environmental sustainability. By using the Chinese and the Australian construction industries as cases, case study methodology is conducted in this research. The quantitative data was collected from several resources including; China Statistical Yearbook, Australian Bureau of Statistics, Engineering News Record, Dun & Bradstreet’s “Who owns Whom” Database and Companies’ Financial Reports. The data were analysed by various statistical methods including: Malmquist Productivity Index, Spearman Rank Correlation Coefficient, Degree of Coordination and Multivariate Cointegration Analysis. An important part of this thesis was to initiate the design and development of a practice based methodology that would be accessible by other researchers and potentially also by policymakers and industry analysts who could improve the way in which we measure the performance of the construction industry. After the methodology was developed it was tested and then evaluated.

This study compared the status and level of the Chinese and the Australian construction industries by using the IAI and proposed that the Chinese construction industry should be involved in a greater number of construction fields (diversification) or improve the level of activity in each involved field (specialization). Compared with the previous models, this study illustrated that the IAI is more comprehensive in reflecting the status and level of a country’s construction industry in the international market. The index also provides a method to access and use data that is more readily available yet is still rigorous and robust. The Malmquist Productivity Index is adopted to explore the Total Factor Productivity (TFP) changes of the Chinese and the Australian construction industries in recent years and comparison were made. The gap in TFP between the Chinese and the Australian construction industries was significant and may become more significant due to the better growth rate of the Australian construction industry in productivity. The difference between the Chinese and the Australian construction industries industrial competitiveness was explored. As ‘activities of the multinational enterprises’ is new for Porter’s Diamond Model and it has not been quantitatively tested, this study tested it by exploring the relationship between the degree of internationalisation and the performance at a construction firm and country levels by using the Spearman Rank Correlation Coefficient.

The results indicated that the activities of the multinational enterprises could be included in the international competiveness model and is considered a determinant factor. For the sustainable development element, the Social Sustainability Index of the Chinese construction industry is the only sub-element which is lower than the Australian construction industry. The Degree of Coordination and Multivariate Cointegration analysis indicates that the three sub-elements of sustainability are interdependent and that they interact. The Social Sustainability Index should be considered as the priority to be improved. However, it was also found that for a long term point of view, if the Environmental Sustainability index needs to be improved, the best way is to improve the Economic Sustainability index, not the Environmental Sustainability index itself, which proved the importance of the interactivity principle of systems thinking and the Long-Term Influence Theory is proposed, as follows: In order to improve the performance of an element/sub-system in a system for a long term point of view, stimulating the element/sub-system directly may be not the best way. It may be better to improve the other elements/sub-systems in the long term, because the dynamic and complex interrelationship among the elements/sub-systems exists within a system, and the influence level and direction between the elements/sub-systems may be different in the long term.
Degree Doctor of Philosophy (PhD)
Institution RMIT University
School, Department or Centre Property Construction and Project Management
Keyword(s) Productivity
Industrial competitiveness
Sustainable development
Internationalisation
Construction industry
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Created: Wed, 23 Dec 2015, 08:08:37 EST by Denise Paciocco
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