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Predicting construction firm performance: an empirical assessment of the differential impact between industry- and firm-specific factors


  • Florence Phua


It is obvious that the performance of firms hinges upon the dynamics of both industry- and firm-specific factors. A less obvious, and perhaps a more important, line of inquiry is that to the extent that they have a bearing on firm performance, how much do these two groups of factors respectively predict firm performance? To date, performance differences among construction firms that stem from industry- and firm-specific differential effect has remained largely unexplored. Using a dataset comprising 526 firms across various construction-related sectors, the sector-by-sector firm performance variation that is attributable to the heterogeneity of both industry- and firm-specific characteristics was empirically examined. That statistically significant results of different effect sizes are found indicates that although these factors are often assumed to be intertwined it is possible to study their respective impact on firm performance. Future studies could usefully replicate and extend this study to construction firms in other countries to further investigate what drives firm performance under different national, industry and firm contexts.

Suggested Citation

  • Florence Phua, 2006. "Predicting construction firm performance: an empirical assessment of the differential impact between industry- and firm-specific factors," Construction Management and Economics, Taylor & Francis Journals, vol. 24(3), pages 309-320.
  • Handle: RePEc:taf:conmgt:v:24:y:2006:i:3:p:309-320
    DOI: 10.1080/01446190500435127

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    References listed on IDEAS

    1. David Jobber & Hafiz Mirza & Kee H Wee, 1991. "Incentives and Response Rates to Cross-National Business Surveys: A Logit Model Analysis," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 22(4), pages 711-721, December.
    2. Florence Phua, 2004. "Modelling the determinants of multi-firm project success: a grounded exploration of differing participant perspectives," Construction Management and Economics, Taylor & Francis Journals, vol. 22(5), pages 451-459.
    3. Schmalensee, Richard, 1985. "Do Markets Differ Much?," American Economic Review, American Economic Association, vol. 75(3), pages 341-351, June.
    4. Jay B. Barney, 1986. "Strategic Factor Markets: Expectations, Luck, and Business Strategy," Management Science, INFORMS, vol. 32(10), pages 1231-1241, October.
    5. JS Armstrong & Terry Overton, 2005. "Estimating Nonresponse Bias in Mail Surveys," General Economics and Teaching 0502044, EconWPA.
    6. Christine Oliver, 1997. "The Influence of Institutional and Task Environment Relationships on Organizational Performance: The Canadian Construction Industry," Journal of Management Studies, Wiley Blackwell, vol. 34(1), pages 99-124, January.
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