The effects of the informal sector on construction

Most construction sectors around the world have a high percentage of output being produced informally. In developing countries informal construction activities can account for as much as 80% of employment (Farrell 2004). In general, the informal sector equates to a significant percentage of country’s GDP — 40% in developing countries and 18% in the OECD high-income countries. The informal sector in construction is not well understood and difficult to measure and is thriving both in the developed and developing world. Construction industries are made up of a large number of small firms and a small number of large firms. Many small firms are less likely to be able (or to want to) afford the bureaucratic demands of a nation’s fiscal and legal system. This evasion means a reduction in tax income for the government, and also leads to inaccurate estimates of the true value of construction output. Some national statistical agencies factor in an estimate of the size of the informal sector, but without effective measurement, there is no guarantee that the estimate is a fair one. The message from the paper is that the informal sector in construction is likely to grow. We need to understand the sector and recognise its impact on construction.

The effect of term-time employment on UK higher education students

In the UK, participation in higher education has risen over the past two decades, along with a shift of the costs of higher education onto the individual and a move to widening participation among previously underrepresented groups. This has led to changes in the way individuals fund their higher education, in particular a rise in the incidence of term time employment. Term time employment potentially plays a much bigger role than in the past, both as a means for individuals to fund their education and reduce debt, and as a way to gain valuable work experience and increase employability. With the increase in the number of graduates in the UK labour market it is now more important for individuals to be able to differentiate themselves in the labour market.

An information approach to the dynamics in farm income: implications for farmland markets

The valuation of farmland is a perennial issue for agricultural policy, given its importance in the farm investment portfolio. Despite the significance of farmland values to farmer wealth, prediction remains a difficult task. This study develops a dynamic information measure to examine the informational content of farmland values and farm income in explaining the distribution of farmland values over time.

Depreciation, income distribution and the UK REIT

Purpose – The purpose of this paper is to consider prospects for UK REITs, which were introduced on 1 January 2007. It specifically focuses on the potential influence of depreciation and expenditure on income and distributions. Design/methodology/approach – First, the ways in which depreciation can affect vehicle earnings and value are discussed. This is then set in the context of the specific rules and features of REITs. An analysis using property income and expenditure data from the Investment Property Databank (IPD) then assesses what gross and net income for a UK REIT might have been like for the period 1984-2003. Findings – A UK REIT must distribute at least 90 per cent of net income from its property rental business. Expenditure therefore plays a significant part in determining what funds remain for distribution. Over 1984-2003, expenditure has absorbed 20 per cent of gross income and been a source of earnings volatility, which would have been exacerbated by gearing. Practical implications – Expenditure must take place to help UK REITs maintain and renew their real estate portfolios. In view of this, investors should moderate expectations of a high and stable income return, although it may well still be so relative to alternative investments. Originality/value – Previous literature on depreciation has not quantified amounts spent on portfolios to keep depreciation at those rates. Nor, to our knowledge, has its ideas been placed in the indirect investor context.

Community mix, affordable housing and metropolitan planning strategy in Melbourne

Income segregation across Melbourne’s residential communities is widening, and at a pace faster than in some other Australian cities. The widening gap between Melbourne’s rich and poor communities raises fears about concentrations of poverty and social exclusion, particularly if the geography of these communities is such that they and their residents are increasingly isolated from urban services and employment centres. Social exclusion in our metropolitan areas and the government responses to it are commonly thought to be the proper domain of social and economic policy. The role of urban planning is typically neglected, yet it helps shape the economic opportunities available to communities in its attempts to influence the geographical location of urban services, infrastructure and jobs. Under the current metropolitan strategy ‘Melbourne 2030’ urban services and transport infrastructure are to be concentrated within Principal Activity Centres spread throughout the metropolitan area and it is the intention that lower-income households should have ready access to these activity centres. However, the Victorian state government has few housing policy instruments to achieve this goal and there are fears that community mix may suffer as house prices and rents are bid up in the vicinity of Principal Activity Centres, and lower-income households are displaced. But are these fears justified by the changing geography of house prices in the metropolitan region? This is the key research question addressed in this paper which examines whether the Victorian practice of placing reliance on the market to deliver affordable housing, while intervening to promote a more compact pattern of urban settlement, is effective.