Abstract
Abstract. The aim of this article is to determine the relation between the phases of the business cycle and changes in prices of factors of construction production. The research covers the years 1994–2012. The dataset applied in the study includes yearly data on prices of the factors of construction production in Poland. All of these data were made available by the SEKOCENBUD. The implementation of the purpose of the study required, firstly, to construct the curve of the economic cycle in the Polish construction industry and, secondly, to determine indicators of changes in the prices of construction production factors and to compare them with the curve reflecting the state of the economic cycle in the construction industry. It was based on the results of a monthly economic situation test, which are published by the Central Statistical Office in Warsaw. A record increase in the prices of production factors in construction was observed during the recovery in 2006–2007. It was caused by the intensified demand for various types of construction services. The deep slump in the construction industry was accompanied by a slight reaction of changes in the prices of construction materials and equipment to the decreasing demand in 2002–2004 and 2008–2012. The results of the study allow to conclude that changes in the prices of production factors in construction are closely related to the situation in the sector, but this relationship is particularly noticeable in the growth phase of the cycle.Key words: economic cycle, building materials and labour, plot of land, real estate
Highlights
Changes in the economic situation have consequences in all sectors, including construction
During the period of the second cycle, i.e. in 1998–2007, and in the beginning of the third cycle, a strong relationship between changes in prices of construction production factors and fluctuations of the curve illustrating the state of the economic situation in the construction industry is observed
These research results allow to conclude that changes in the prices of production factors are closely connected with the economic situation in construction
Summary
Changes in the economic situation have consequences in all sectors, including construction. In the mid-90s, the market of private construction companies had just begun to take shape, and the improving economic situation (the economic cycle indicator amounted to 25) was conducive to its development In the second half of 1997, a gradual downturn began It accelerated rapidly in July 2000 (the economic cycle indicator decreased almost to the level of 15), leading the construction market into recession in the years of 2002 to 2004 (the economic situation indicator took negative values of about –5). Prices of the material factors of construction production are significantly associated with the situation in the sector As it has already been mentioned, the price level in the market is shaped by the relationship between supply and demand.
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