Modeling of fragmentation in the construction industry

Proceedings of the International Conference on Management and Service Science, 2009, p. 1-4This study develops a self recruiting-subletting cost indifference point model to explain the fragmentation in the structure of the construction industry. Although a high proportion of small firms in the construction industry has be criticized as it prevents the exploitation of economies of scale, the self recruiting-subletting cost indifference point model theoretically proposes that subletting is usually profitable for construction firms; thus the size distribution of the construction industry should skewed towards small firms. ©2009 IEEE.published_or_final_versio