Macro models of UK construction contract prices

This paper describes the derivation of macro construction contract price models that are based on the economic theory of demand and supply using OLS multiple regression analysis. A structural equation model is presented which offers a structural explanation of the movements in the construction tender price index. Leading indicators of contract prices (in real terms) produced by the structural equations were unemployment level, real interest rate, manufacturing profitability, number of registered construction firms, building cost index, construction productivity and construction work stoppages. The equation produced an adjusted R2 of 0.97 for deflated data with minimal serial autocorrelation. A predictive reduced-form model is also developed that utilises simultaneous equation models comprising construction demand, supply and equilibrium models

Explaining Differences in Growth across Developing Countries

This analysis attempts to explain the differences in per-capita GDP growth in developing countries over the period 2000-2010. Using OLS estimators on an initial cross-section data sample of 30 developing countries, we find that growth rates are positively affected by savings rates in the decade, natural resource endowment, and inflation volatility, while they are hindered by population growth over the decade, savings rates over the previous decade, initial per-capita income, and tropical location. An expansion of economic freedom is found to quadratically relate to growth, at first increasing it and then having a negative effect. Income inequality and landlocked variables are not shown to significantly affect growth rates over this period. However, testing the model on a second sample of developing countries showed markedly different and insignificant explanatory power of the identical variables, suggesting the original model is not robust