Faghih, S A M and Kashani, H (2018) Forecasting construction material prices using vector error correction model. Journal of Construction Engineering and Management, 144(8): 04018075, ISSN 0733-9364
Abstract
This paper presents a vector error correction (VEC) model for use in forecasting the short- and long-term prices of construction materials. This model characterizes the relationship between construction material prices and a set of relevant explanatory variables. The use of VEC models to forecast construction material prices addresses a gap in the existing literature that stems from overlooking the importance of forecasting both the short- and long-term movements of individual construction materials. The proposed model is applied to produce forecast models for asphalt, steel, and cement prices in the United States based on the identified variables that govern the prices of each material. Practitioners can use the proposed model to forecast construction material prices. The derived insights can be used to enhance the chances of project success.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | cointegration analysis; cost estimation; material prices; time series analysis; vector error correction |
| Index terms: | cointegration, cost estimating, vector error correction model, time-series analysis, project success, forecasting, United States, movement, construction material, practitioner |
| Subjects: | practitioner, health behaviours and lifestyles, research evaluation and metrics, Geography, project management theory and practice, financial and cost management, building materials, economic analysis, prediction and forecasting |
| Topics: | Engineering Principles, Research Practice, Roles and Professions, Geographical Context, Business Strategy, Cost Management, Project Management |
| Descriptive scope: | 3 PCA |
N.B. Descriptive scope is a count of how many of the five facets of empirical research are indicated by the words used in title, abstract and keywords. It is not intended as a judgement on the research; merely a count of the kind of word we would expect to indicate Phenomenon, Concepts, Theoretical framing, Empirical techniques, Analytical techniques. If all five are present, then a code of “5 PCTEA” will indicate this. If you feel the coding for this record is questionable, we welcome discussion around the terms we matched or the way we categorized them. The facet you would expect may not be coded, or a facet may be coded inappropriately. This can also bear on a larger question, of which facets should be treated as defining in construction management research. Please get in touch, and we will look at it. More details here