ABSTRACT
An important theme in Part C has been the idea that construction plays a leading role in the process of national development and macroeconomic management. The following two extracts analyse the shape of the Bon curve, which is derived by plotting GDP per capita against expenditure on construction to show the importance of this sector to economic growth. The first edited extract is based on the empirical evidence from 39 countries, at different stages of development, during 1994-2000. The authors adopt a clear and general approach to introduce and interrogate Bon’s theory. The second extract is slightly more advanced, in the sense that it seeks to question the exact shape of the curve for smaller nation states, such as Hong Kong, Singapore, and Trinidad and Tobago, and provides a case study approach that focuses on data relating to Cyprus during 1998-2005. Some obvious questions are suggested by studying these extracts. For example, does the data reflect the current relationship between construction output and GDP in your country? In other words, use recent construction data to clarify your understanding of the sector’s broader impacts on the current pace and direction of economic growth. What do you think of the closing idea posed in the second extract that micro-states with fragile ecosystems will inevitably experience sharper limits on construction growth than larger scale economies? Finally, what are the implications of the dynamic role of construction for macroeconomic management? In particular, consider the importance of government policies designed to secure growth, maintain stable prices and protect the environment.
