TY - JFULL AU - Wenhua Hou and Xing Liu and Deqiang Chen PY - 2011/11/ TI - Payment Problems, Cash Flow and Profitability of Construction Project: A System Dynamics Model T2 - International Journal of Economics and Management Engineering SP - 1265 EP - 1272 VL - 5 SN - 1307-6892 UR - https://publications.waset.org/pdf/1811 PU - World Academy of Science, Engineering and Technology NX - Open Science Index 58, 2011 N2 - The ubiquitous payment problems within construction industry of China are notoriously hard to be resolved, thus lead to a series of impacts to the industry chain. Among of them, the most direct result is affecting the normal operation of contractors negatively. A wealth of research has already discussed reasons of the payment problems by introducing a number of possible improvement strategies. But the causalities of these problems are still far from harsh reality. In this paper, the authors propose a model for cash flow system of construction projects by introducing System Dynamics techniques to explore causal facets of the payment problem. The effects of payment arrears on both cash flow and profitability of project are simulated into four scenarios by using data from real projects. Simulating results show visible clues to help contractors quantitatively determining the consequences for the construction project that arise from payment delay. ER -