• KDI Journal of Economic Policy
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• v.36 no.3
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• pp.95-120
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• 2014

This paper attempts to demonstrate the critical role of expectation horizons in economic agents building their expectations for the future. It starts with the analysis of what constraints the economics-based assumption related to information efficiency could impose in the stochastic process, and then suggests a new concept, random revision of expectation, to refer to the case when the adjustment process of expected variables employs newly generated information only. According to the inflation dynamics formula drawn under this condition, the demand pressure measured by output gap is found to cause different impacts on inflation according to different expectation horizons. The empirical analysis of this model using the data on Korea reveals that a short expectation horizon causes coefficient estimates to become small and statistically less significant.

• KSCE Journal of Civil and Environmental Engineering Research
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• v.35 no.1
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• pp.217-227
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• 2015

This study conducted case studies in order to suggest the improvement of GDP (Gross Domestic Product) deflator method which is adopted on calculating fluctuation rate on BTL (Build-Transfer-Lease) sewer rehabilitation projects in Jeju. As a result, because GDP deflator method calculates fluctuation rate by each quarterly, the fluctuation rate of GDP deflator method is higher than it of index adjustment rate method. And GDP deflator method cannot reflect real price because of applying fixed index in whole construction cost for calculating fluctuation rate. Especially, the notification day - the base point influences fluctuation rate and fluctuation amount strongly in GDP deflator method.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• autumn
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• pp.383-386
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• 2001

The ability to make good cost overruns predictions is a very important aspect of in major construction project. The probabilistic cost models can provide more reliable than traditional cost models which have been used in korea to prepare Bill of Quantities, if the actual cost data are sufficient enough to analyze the trends of the variables. The paper considers non-deterministic methods in a cost estimate. The method(referred to as the 'Monte Carlo simulation' method) interprets cost data indirectly, to generate a probability distribution for total costs from the deficient elemental experience cost distribution. The objectives of this research is to develop a method to forecast the probabilistic total construction cost and the elemental work cost

• Korean Journal of Construction Engineering and Management
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• v.12 no.2
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• pp.3-11
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• 2011

There are several causes to recalculate the contract amount in public construction projects. Among them, the escalation clause was introduced in 1969 and now the condition to recalculate the cost is effective after 90 days from the date of contract and the rate of fluctuation should be more than 3% from the date of bidding. The two calculation methods for the rate of fluctuation are item-adjustment and index-adjustment. According to the results of investigation into 4 public institutions and 163 projects, all of them have used the method of index-adjustment and the rate of projects that spend over 6 months obtaining the approval of contract amount adjustment is more than 90%. The reason for spending lots of time is caused by problems of the calculation method on the price fluctuation rate. Therefore, it is necessary that the calculation method should be diversified to cope with the problems and a option of the builder should be expanded as well. Furthermore, if the way to apply correction factors to construction price index and average index based on the producer and consumer price index made by the bank of Korea is added, then the duration will be reduced without additional expenses. This study proposed the diversification of the calculation method using price fluctuation rate and builders' expanded options as improvement on the managerial method of Price Fluctuation System for the prompt and efficient contract amount adjustment.

• Korean Journal of Construction Engineering and Management
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• v.7 no.5
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• pp.77-84
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• 2006

Indexes have played an important role as a economic indicator or performance indicator in many industries for a long time. In construction industry, indexes, or Construction Cost Index(CCI), have been used to compensate for the gap of time in Estimate Using the Historical Cost Data from Feb. 2004. CCI is composed of index formula and resources. Existing literatures had used Laspyeres Index as a index formula. And, Leontief table, the bills of quantities, and information of price surveyor were used as a resource. When applying Laspyeres formula and the resources to calculating the CCI, the problems such as double application of price fluctuation, calculating the incorrect weights, may be generated. This paper analyzed the existing economic relevant indexes as well as Laspyeres formula. Thus, feasibility of them was analyzed using three practical cases of apartments. And then, Quantity based Base Period Price Index(QBPPI) was developed to consider the characteristics of construction more accurately.

• Proceedings of the KIEE Conference
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• 2011.07a
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• pp.2120-2121
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• 2011

현재 정부가 추진하고 있는 전기분야 실적공사비 적산제도와 관련된 최근의 움직임은 당초의 취지와 달리 실적공사비에 대한 개념 부족과 임의적 해석 등으로 실적공사비 적산제도 도입의 바람직한 방향성에도 불구하고, 실적단가 축적의 기초 자료인 계약내역서의 직접 공사비 낙찰률 적용 관계 등 실적단가의 적정성에 대한에 근본적인 접근보다 예산절감, 물가안정 측면으로 접근하여 시장단가 반영에 대한 왜곡현상이 발생 할 수 있는 제도상의 문제점으로 실적단가 축적에 대한 적정성 판단에 따른 실적단가의 보정 수단이 미약하여, 현행 법제도 하에서 실적단가의 적정성 확보를 위한 대응 방안을 제시하여 실적공사비를 정착시킬 필요가 있다. 왜냐하면 품셈에 의한 문제점 등으로 실적공사비 적산제도로 공공 건설공사의 예정가격산정 방식을 전환 하였다고 볼 때, 본 제도의 실패는 또 다른 제도로의 전환 또는 보완이 필요하다고 판단된다.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• 2004.11a
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• pp.256-260
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• 2004

As a large portion of defence budget are alloted for military facility construction, reasonable budget estimation in the planning stage has been officers' main concerns. However the proper estimation of construction cost is difficult to be carried out due to the absence of systematic criteria. To improve the budget estimation for military facility construction, this study proposes a cost index model which can convert historical cost to current cost. Thus the developed cost index would enhance effectiveness of budget estimation process 3nd support reasonable decision making. This cost index model is developed by analyzing historical cost data with statistical methodology The study is executed by following process. First, factors which affect construction cost for the most are selected by analyzing historical cost data. second, the selected factors are categorized material cost, labor cost and equipment cost, and weights of those factors are calculated by dividing the cost of each factor by total item costs. Last, cost index is developed by using weighted average method.

• Korean Journal of Construction Engineering and Management
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• v.15 no.5
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• pp.49-60
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• 2014

Electrical construction cost index has been applied fixed-weighted method. But fixed-weighted method can't faithfully reflect industrial structure changes. Because the weighted value and price index of fixed-weighted method is fixed on the basic period. Electrical construction cost index is composed of the cost of labor and material. So it fluctuates sharply whenever the construction association of korea announces the laborer's wage of electrical construction. And it depends on only the producer price index changes that is related to electrical construction since then. So a study is focused on developing electrical construction cost index applied chain-weighted method. Because chain-weighted method can reflect the realities of the electrical construction and alleviate the sudden changes of labor cost with link index. We verify that chain-weighted method relieves the step states of electrical construction cost index applied fixed-weighted method.

• Journal of Korea Water Resources Association
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• v.53 no.8
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• pp.569-582
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• 2020

Recently, Korea has faced a change in the pattern of water use due to urbanization, which has caused difficulties in understanding the rainfall-runoff process and optimizing the allocation of available water resources. In this perspective, spatially downscaled analysis of the water balance is required for the efficient operation of water resources in the National Water Management Plan and the River Basin Water Resource Management Plan. However, the existing water balance analysis does not fully consider water circulation and availability in the basin, thus, the obtained results provide limited information in terms of decision making. This study aims at developing a novel water circulation analysis model that is designed to support a quasi-real-time assessment of water availability along the river. The water circulation model proposed in this study improved the problems that appear in the existing water balance analysis. More importantly, the results showed a significant improvement over the existing model, especially in the low flow simulation. The proposed modeling framework is expected to provide primary information for more realistic hydrological drought monitoring and drought countermeasures by providing streamflow information in quasi-real-time through a more accurate natural flow estimation approach with highly complex network.

• KDI Journal of Economic Policy
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• v.34 no.3
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• pp.1-29
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• 2012

Based on the spatial and land price data of innovation cities and their periphery areas in Korea, this study examines the degree and timing of changes in land price in relation to projects concerning innovation city. The study result confirms that the current system is inconsistent with the principle of restitution of development gain and therefore, this study attempts to seek improvement measures so that the current system can better fit the principle. The analysis reveals that most innovation cities, excluding Sinseo-dong of Daegu and Ujeong-dong of Ulsan, recorded a statistically significant increase in land prices since 2005, compared to those of their neighboring areas. It can be said that the information related to projects concerning innovation city was reflected in the land price since 2005. However, the standard land price pursuant to Article 70 of the Land Compensation Act is the officially assessed land price released on 1st of January 2007, and this official land price was actually applied to the compensation process. Therefore, estimating the compensation amount for land expropriation based on this land price will contradict the principle of restitution of development gain. In other words, despite the fact that development-related information was already reflected in land prices of innovation cities from 2005 to the end of 2006, the compensation process were carried out without institutional arrangements or efforts to exclude such reflection. To solve this problem, this study makes two suggestions. First, it is necessary to cast aside the limitations of the official land price that can be retroactively applied in accordance with Paragraph 5 of Article 70 of the Land Compensation Act, and instead apply the land price which is the most latest but deemed to have no reflection of development gains. Based on this revised standard land price, if the compensation amount is corrected by the average inflation rate and the average rate of increase in land price during the period until the time of the recognized land price, the amount would better satisfy the principle of restitution of development gain. Second, it is necessary to clearly stipulate the standards of development gains being reflected on the land price by including it in the secondary legislation. Under the current system, it is highly likely that appraiser's arbitrary interpretation on development gains is included in the process of calculating the amount of compensation for land expropriation. In this regard, it is necessary to improve the standards on determining whether development gains are reflected based on the results of this academic research and the existing guidelines for appraisal of compensation for land expropriation published by the Korea Association of Property Appraisers.