• Korean Journal of Construction Engineering and Management
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• v.21 no.2
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• pp.59-69
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• 2020

The regulation of business area was abolished to improve the competitiveness of the construction industry and the ability of general and specialty contractors to enter the mutual market. As the next step, the government is preparing for a reorganization of business type. If the impact of the abolishing of business area on the construction industry is analyzed, the result can contribute to determining the step by step application scope of the reorganization of business type. This study derived the business types having a high probability of the mutual market entry of general and specialty contractors. Then, the size of mutual market entry is analyzed. First, the connection between the general and specialty construction, and the similarities between the registration standards of general and specialty construction are analyzed. Based on the result, a general contractor can enter 15 business types of specialty construction, and the market size is about 78.8 trillion KRW. This is about 82% of the total contract cost of specialty construction during the year 2017 (about 96 trillion KRW). Next, based on the relevance of business contents, the market size when general contractors enter the specialty construction market is analyzed. As a result, the market size is about 24.7 trillion KRW, and this is about 13% of total contract cost of general construction during the year 2017 (about 190 trillion KRW). Based on the result of this study, there is a higher probability of the mutual market entry of general contractors into specialty construction than vice versa. However, the result of this study is based on the current contents of business types, registration standards, and construction data of before abolishing the regulation of business area. This is a research limitation. If the business contents and registration standards are changed in the future, the result could differ from the current result.

• Proceedings of the Korean Institute Of Construction Engineering and Management
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• 2004.11a
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• pp.388-393
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• 2004

The organic law on the Construction Industry, initially, this law was enacted with a view to preserving and fostering the specialty of each type of industry. By dividing each construction business boundary, it gradually settles the system of construction specialized on the basis of productive stages. Controversy over the abolishing regulations on business boundary still continues to swirl. Since the intensity of exclusion as well as rigidities become increased. This results from the fact that informations are not shared among business boundary and businesses under the protection of the business boundary regulations choose 'rent-sicking activity'. According to dissidents against this law, structure should be established not by artificially enforced institution but by voluntary efforts of participants in construction industry. This paper aims at improving the competitive of the construction industry by showing the efficient system of construction and proving the legitimacy of abolishing business boundary

• Korean Journal of Construction Engineering and Management
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• v.2 no.2 s.6
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• pp.37-46
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• 2001

Business boundaries of firms in the construction industry are strictly regulated in Korea. Under the current law, firms involved in construction processes are classified into five categories; general contractors, specialty contractors, architects' offices, engineering firms, and specialized in inspection. Among these types of firms, general contractors are prohibited to enter into specialty contractor's market and vice versa by the basic law in the construction industry. Also general contractors are not allowed to provide architectural services. The purpose of the law is to prohibit unlicensed companies from entering the construction market and to protect customers. However, the law causes critical problems e.g. low efficiency of production and rent creation. Therefore, we identify problems concerning business boundaries of firms in the construction industry and predict structural changes in the them when they are liberalized. So we surveyed general contractors and specialty contractors in Korea to estimate the effects of the liberalization on the construction industry. Most of contractors point to the enhancement of production efficiency as the motivation to integrate other construction process. If current regulations, which limit firms' decisions on business boundaries, are eliminated, firms will choose optimal business scopes taking into account types of contracts adopted by the Government for public works. Based on the cost/benifit analyses, they will decide whether to intergrate other production processes or not.

• KSCE Journal of Civil and Environmental Engineering Research
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• v.44 no.1
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• pp.75-83
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• 2024

This study examined the causes and remedies of bid-rigging in the construction industry through a survey of procurement practitioners. The study identified potential problems from the business, construction, and bidding environments, and proposed improvements to the procurement and bidding systems to address these problems. The study found that transparency, fairness, and diversity are important factors in reducing bid-rigging. These factors can be achieved through a variety of measures, such as expanding bidding systems, strengthening fairness standards, and increasing the diversity of participating companies. The study also found that unfair subcontracting regulations are a problem that needs to be addressed. There were differences in the perceptions of the causes of bid-rigging between the general and specialized construction groups. However, there was no difference in the perceptions of improvements to the procurement system between the two groups. This suggests that a consistent solution to bid-rigging can be found. The study's findings are expected to contribute to the resolution and prevention of bid-rigging in the construction industry.

• Korean Journal of Construction Engineering and Management
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• v.22 no.1
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• pp.63-71
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• 2021

The construction guarantee market is a rear market affected by changes in the construction industry and market. As the restructuring of the construction industry's production system is being carried out, such as the abolition of regulations on business field between general and specialty contractors, major changes are expected not only in the construction market but also in the construction guarantee market. In construction guarantee market, there are currently three Contractor Financial Cooperatives, which are divided based on business field and business type(General, Specialty and Plant & Mechanical). The abolition of business field regulation will have various effects on construction guarantee market, such as forming a competitive structure among the three Contractor Financial Cooperatives. Therefore the role of the construction guarantee institutions are also required to change. This study predicted the changes in the construction guarantee market after the restructuring of construction industry and analyzed the ripple effect on the market. This study reviewed the details of the reorganization plan on the construction industry, policies and statistical data related to construction guarantee, and lastly conducted the survey on each member of the three Contractor Financial Cooperatives to analyze the usage behavior in the future guarantee market. Based on the result of this study, the members of both the General Contractor Financial Cooperative and Specialty Contractor Financial Cooperative are not willing to change the existing institutions, but a lot of them are expected to use other institutions in duplicate. The members of the Plant & Mechanical Contractor Financial Cooperative are most willing to use other guarantee institutions.