The construction industry is no longer focused on providing a single product ‐ i.e. a building or a physical infrastructure, but a variety of services and improvement to the human environment. Major trends such as Performance‐based Building as well as Sustainable Built Environment are calling for major changes. These changes mean additional roles for the industry as well as the need for new indicators to measure its performance and its economic impact. This paper proposes a new approach based on the development of a framework for the analysis of the entire construction and property sector ‐ the “built environment cluster”. It extends the analysis of an international study based on nine countries ‐Australia, Canada, Denmark, France, Germany, Lithuania, Portugal, Sweden, and the United Kingdom. The need for improving statistical data is stressed particularly in the context of enlarging the scope of the industry. This new approach provides an excellent starting point for developing new performance indicators that will take into account the changing nature of the industry, for an integrative perspective providing a basis for strategic management, for studying sustainable development in construction and for understanding innovation processes and changes. A comprehensive perspective of the industry performance is crucial for policy initiatives as well as for strategic analysis of firms.

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The implications for analysis of innovation in construction of theoretical developments in industrial organisation are considered in this research, as an attempt to outline a new approach to construction innovation incorporating the ideas found in knowledge based, technology centred models. The paper firstly summarises characteristics of the construction industry, focusing on their effects on innovation, before surveying some of the ideas about the sources of innovation and the expansion and application of knowledge. Construction can be seen as an industry with limited scope for knowledge externalities, where the procurement methods used by the industry"s clients do not pay for innovation. The following discussion uses recent developments in the research on the economics of innovation and industrial organization theory, such as research intensity and the endogenous sunk costs in competitive, fragmented, low research intensity industries. The effects on R&D of procurement methods and on industry structure are discussed, with a focus on the appropriability of innovations and the role of the client on the Heathrow Terminal 5 project. The paper concludes that the procurement methods used for building and construction projects appears to be a determining factor in the level of innovation in the construction industry.

This paper analyses the multimedia industry in Sydney. It seeks to understand whether the emergence of the industry has involved dense horizontal and vertical inter‐firm linkages characteristic of an industrial cluster, or whether the industry has grown because of general urbanisation economies related to such factors as skilled labour supply and market demand. The industry is highly concentrated in and around central Sydney. This provides the best access to firms’ main clients, notably advertising companies and other multimedia firms. It also reflects the centralised location of skilled labour such as web designers. While there is evidence of an emerging inner Sydney multimedia cluster which includes graphic design and advertising and related media, the main driver of the industry's development appears to have been general demand from advertising and related media companies, in association with the pool of computer graphics talent generated by these companies.

Purpose Official statistics on the output of the construction industry capture on-site activities of contractors and sub-contractors; however, the role of the industry linking suppliers of materials, machinery, products, services and other inputs is also widely recognised. These two views have been called broad and narrow, with the narrow industry defined as on-site work and the broad industry as the supply chain of materials, products and assemblies, and professional services. An argument is made for using the term “built environment sector” (BES) for the broad industry definition of construction. The paper aims to discuss these issues. Design/methodology/approach Construction industry statistics capture the on-site activities of contractors and sub-contractors. This paper reviews research that adds to construction output the contributions of suppliers of materials, machinery and equipment, products and components, professional services and other inputs required to deliver the buildings and structures that make up the built environment. Findings The same term, “construction”, has been used in a number of ways in different definitional studies of the narrow and broad industry. The term that best encompasses the large number and range of participants in the creation and maintenance of the built environment, from suppliers to end users, is the BES. Research limitations/implications Construction economics makes an important contribution to researching the macroeconomic role of the BES. There is also a special role for construction economics in researching both the boundaries of the BES and the data available on the industries that contribute to the BES. Practical implications Measuring the BES would improve the understanding of its macroeconomic role and significance. Social implications Measuring the BES would contribute to city policies and urban planning. Originality/value The paper proposes a new approach to defining and measuring the industries that contribute to the production, maintenance and management of the built environment. It introduces a new name for the combination of those industries.

This research looks at the significance of barriers that firms considering entry into the construction industry might face. Drawing on the microeconomic characteristics of imperfectly competitive and oligopolistic markets the analysis finds that there are a dozen barriers to entry that affect the industry, but their significance depends on the product type. The discussion covers the question of product homogeneity in construction and evidence for the existence of barriers to entry in concentration levels. Barriers to entry specific to construction are then identified, which leads to an analysis of how they operate and their significance (high, medium or low) in different market types, thus increasing our understanding of construction industry dynamics.

The analysis and understanding of the conduct and performance of an industry beginswith a study of its structure. However, before analysing an industry's structure it isnecessary to define the industry and identify its size, scope and scale to establish itstrue economic contribution. This paper discusses the size and scope of the Australianbuilding and construction industry, firstly, from a traditional industry economics approachby firm size and business characteristics using data from three construction industrysurveys done over 15 years by the ABS. Secondly, data from an industry 'cluster'perspective is shown. The objective of the paper is to compare the differences found inindustry size and scope in the structure-conduct-performance approach and thealternative industry cluster approach. Each model reveals different characteristics of theindustry. The conclusion finds that the building and construction industry is a casewhere the traditional structure-conduct-performance model cannot be easily applied.53