THE STUDY OF GROWTH FACTORS OF THE PROFIT ORIENTED BUSINESS IN THE CONSTRUCTION INDUSTRY

Sergey Oparin, Nikolay Chepachenko, Marina Yudenkо, Irina Kuzovleva

Abstract


This study concluded that the problems of economic growth are determined by a number of factors, the main of which are – economic, industrial, technological, institutional, non-economic. The article focuses on the analysis of institutional factors which regulate companies’ activities by reducing the impact of administrative barriers. This article identifies the role of economic efficiency and its influence on the economic growth of the construction industry businesses. This article offers a method of profit calculation by the reduction of transaction costs. This method is adapted to the construction sector, which features a number of independent and related fields, a large number of participants of the construction process and institutions that altogether lead to the occurrence of administrative barriers. The calculations that were done confirm that the reduction of transaction costs affects the efficiency of construction companies. The resulting extra profit, from reducing the transaction costs, is a source of economic growth for companies in the construction industry.

Keywords


institutional factors, economic growth, construction, entrepreneurship, economic efficiency, administrative barriers

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DOI: http://dx.doi.org/10.12955/cbup.v6.1183

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