What are the most important economic concepts that determine the Essay

What are the most important economic concepts that determine the structure of the construction industry - Essay Example nstruction industry, several factors of production are involved and they include, but are not limited to capital, raw materials, and labor (Myers, 2008). All the resources employed in the construction industry play a significant part towards the delivery of standardized and quality products. The allocation of the related resources to an activity is done based on the concept of increased efficiency and matching output levels. For example, the amount of labor available for a set project is subject to financial constraints as well as the availability of the labor in the market. Financial constraints dictate the price and cost of labor and as such, the construction industry is subject to external and internal forces. This introduces the second main economic concept concerned with the examination of external and internal constraints. External constraints or forces relate to outside influences, not in the control of the construction sector such as support services provided by banking and insurance institution (Myers, 2008). The construction sector relies to some extent on the availability of financial support in capital formation from banking institutions and has to develop its structures around financial requirements and standards. External support systems such as the access to insurance are important in the mitigation of the sector from probable risks. Risks in the sector vary according to the type of construction involved and the possible losses could have fatal financial as well as legal implications on the construction sector. However, external factors should not be viewed as limiting factors in the development of concrete structures in the construction sector, but as elements promoting the development of the construction sector. The internal forces influencing the structure of the construction sector are reliant on the allocation and distribution of scarce resources. The participants of the construction sector engage in continued evaluation of internal resources