| Title |
A Composite-Index-Based Dynamic Cost-Tier Model for Construction Management Fee Estimation |
| DOI |
https://doi.org/10.5659/JAIK.2026.42.10.145 |
| Keywords |
Construction Management Fee; Actual-Cost-Plus-Fixed-Rate Method; Composite Construction Cost Index; Dynamic Cost-Tier; Input-Output Table; Producer Price Index; Annex 2 |
| Abstract |
The current actual-cost-plus-fixed-rate method prescribed in Korea’s Standards for Construction Engineering Fees exhibits three structural
time-frozen problems: wage updates are external to the personnel-input structure of Annex 2, direct-expense correction depends on a
separately published index with publication and application lag, and nominal cost-tier boundaries are not adjusted for inflation. This study
proposes a composite-index-based dynamic cost-tier model to address these rigidities through three instruments: a Composite Construction Cost
Index (CCCI), a Weight Derivation Algorithm (WDA), and a Dynamic Cost-Tier function (DCT). The CCCI combines the Bank of Korea
Producer Price Index, KOSIS-based market wage data, and the construction-sector input structure of the Bank of Korea Input-Output table.
The WDA derives weights through a dual structure combining intermediate input coefficients and the compensation-of-employees share in
value added. The DCT function, (t)=CCCI(t)/CCCI(? ), converts nominal construction cost into a reference cost tier, with 2014-05-23, the
date of MOLIT Notice 2014-298, set as the reference point. A Spreadsheet-Based Simulation Platform (SBSP) was developed to implement
Annex 2 fee-calculation logic for the architectural sector. The platform covers ten cost tiers and two delegated-supervision statuses, yielding a
20-scenario matrix based on three directly measured tiers and seven interpolated or extrapolated tiers. Simulation results indicate that, for a
nominal KRW 50 billion architectural project in 2026, omitting DCT correction yields a fee estimate approximately 24% higher than the
DCT-corrected estimate, while delegated-supervision status produces an approximately 35% fee difference within the same tier. The proposed
model provides a framework for linking external statistical updates to CM fee estimation without repeated administrative re-notification. |