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Aoieong, R T, Tang, S L and Ahmed, S M (2002) A process approach in measuring quality costs of construction projects: model development. Construction Management and Economics, 20(02), 179-92.

Drew, D S, Lai, P Y, Li, H and Lo, H P (2002) Correcting the fee-technical score variability imbalance in two-envelope fee tendering. Construction Management and Economics, 20(02), 157-66.

Haan, J D, Voordijk, H and Joosten, G-J (2002) Market strategies and core capabilities in the building industry. Construction Management and Economics, 20(02), 109-18.

Ho, S P and Liu, L Y (2002) An option pricing-based model for evaluating the financial viability of privatised infrastructure projects. Construction Management and Economics, 20(02), 143-56.

  • Type: Journal Article
  • Keywords: BOT; privatized; infrastructure; option pricing theory; financial decision-making; investment evaluation
  • ISBN/ISSN: 0144-6193
  • URL: https://doi.org/10.1080/01446190110110533
  • Abstract:

    Privatized infrastructure projects have to demonstrate their financial and technical viability before they are undertaken. Although it is relatively easy to demonstrate the technical viability of an infrastructure project, the evaluation of the financial viability of a privatized infrastructure project is complex and challenging, mainly because of the uncertainties involved due to the project’s scale, long concession period and complexity. Traditional methods, such as net present value (NPV) analysis, fall short in reflecting the characteristics of privatized infrastructure projects and the risks involved. This paper presents an option pricing based model, the BOT option valuation (BOT-OV) model, for evaluating the financial viability of a privatized infrastructure project. This quantitative model considers the project characteristics explicitly and evaluates the project from the perspectives of the project promoter and of the government when the project is under bankruptcy risk. Moreover, the model can evaluate the impact of the government guarantee and the developer negotiation option on the project financial viability

Leu, S-S and Hung, T-H (2002) A genetic algorithm-based optimal resource-constrained schedule simulation model. Construction Management and Economics, 20(02), 131-41.

Nicolini, D (2002) In search of 'project chemistry'. Construction Management and Economics, 20(02), 167-77.

Sing, T-F (2002) Time to build options in construction processes. Construction Management and Economics, 20(02), 119-30.