Lam, K C; Song Hu, T I E; Ng, T; Yuen, R K K; Lo, S M and Wong, C T C (2001) Using an adaptive genetic algorithm to improve construction finance decisions. Engineering, Construction and Architectural Management, 8(1), pp. 31-45. ISSN 0969-9988
Abstract
Optimizing both qualitative and quantitative factors is a key challenge in solving construction finance decisions. The semi-structured nature of construction finance optimization problems precludes conventional optimization techniques. With a desire to improve the performance of the canonical genetic algorithm (CGA) which is characterized by static crossover and mutation probability, and to provide contractors with a profit-risk trade-off curve and cash flow prediction, an adaptive genetic algorithm (AGA) model is developed. Ten projects being undertaken by a major construction firm in Hong Kong were used as case studies to evaluate the performance of the genetic algorithm (GA). The results of case study reveal that the AGA outperformed the CGA both in terms of its quality of solutions and the computational time required for a certain level of accuracy. The results also indicate that there is a potential for using the GA for modelling financial decisions should both quantitative and qualitative factors be optimized simultaneously.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | adaptive genetic algorithm; cash flow |
| Index terms: | modelling, optimization technique, case study, accuracy, profit, qualitative factor, genetic algorithm, construction firm, cash flow, Hong Kong, construction finance |
| Subjects: | organization, economic analysis, professional development, financial management, Geography, algorithms, data collection methods, data analysis and analytics, analytical methods |
| Topics: | Information Management, Digital Applications, Geographical Context, Engineering Principles, Cost Management, Business Strategy, Research Practice |
| Descriptive scope: | 4 PCEA |
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