Liu, H; Kwigizile, V and Huang, W C (2021) Holistic framework for highway construction cost index development based on inconsistent pay items. Journal of Construction Engineering and Management, 147(7): 04021052, ISSN 0733-9364
Abstract
A construction cost index (CCI) measures the price changes of construction items over time. It allows owner agencies and contractors to monitor construction market fluctuations so that they can more accurately estimate construction costs and project long-term funding needs. However, various CCI calculation methods in the highway construction industry are limited in two respects: (1) inability to account for inconsistent pay items, primarily caused by changes in pay item catalogs, and (2) insufficiency in statistically cleaning pay item data, e.g., unbalanced bid prices. For this reason, the resulting highway construction cost index (HCCI) cannot accurately reflect the construction market. To address such limitations, this research develops a three-step holistic framework for automated HCCI development using inconsistent pay items. The three-step methodology encompasses (1) data cleaning, where a text analysis algorithm and outlier detection algorithms are developed to clean inconsistent pay items and unbalanced bid prices; (2) pay item sampling, which helps to select and edit pay items through various statistical analysis; and (3) HCCI calculation, where the chained Fisher index formula is applied to calculate HCCIs at the state level, as well as indexes for specific regions and item categories. A prototype application is developed to generate quarterly and annual HCCIs automatically using the Python programming language. Ten-year data, i.e., 251,033 records, were used to verify and validate the prototyped system. The resulting HCCI and sub-HCCIs provide reliable insights into construction market conditions with high granularity. This research contributes to the body of knowledge by offering a holistic framework for automated HCCI development that leverages the text analysis algorithm for accounting for inconsistent pay items and two-stage outlier treatments for cleaning pay item data.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | construction market condition; cost estimating; data analytic; highway construction; inconsistent pay items; price index; unbalanced bid prices |
| Index terms: | construction market, cleaning, estimate, sampling, highway construction, funding, statistical analysis, cost index, owner, construction cost, accounting, body of knowledge, agency, construction cost index, programming, methodology, text analysis, prototype, cost estimating |
| Subjects: | market analysis, sociology, civil engineering, research methods, maintenance engineering, knowledge management, data science, economic analysis, financial and cost management, analytical methods, cost indicators, modelling and simulation, programming, data collection methods |
| Topics: | Stakeholder Management, Business Strategy, Cost Management, Research Practice, Engineering Principles, Information Management, Design Practice, Digital Applications |
| Descriptive scope: | 5 PCTEA |
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