Economic Review, Vol. 77 No. 4, 2026.
Review article
https://doi.org/10.32910/ep.77.4.3
Efficiency and Productivity in the Croatian Construction Sector: Trends and Challenges
Andrea Arbula Blecich
Nikolina Dukić Samaržija
Luka Samaržija
Abstract
Croatian construction companies continue to struggle with inefficiencies and slow adoption of digital tools. Understanding the key drivers of efficiency and productivity is therefore crucial to ensure the long-term sustainability and competitiveness of the sector. This paper examines efficiency and productivity trends in the Croatian construction sector from 2019 to 2023, focusing on large and very large construction companies and the key challenges impacting their performance. Using Data Envelopment Analysis (DEA) and the Malmquist Productivity Index (MPI), the study tracks efficiency and productivity changes over time using a three-year window analysis of company accounting data. The results show that overall efficiency remains relatively low but stable, with a slight decline in 2023. The main causes of inefficiency are management practices and external factors rather than a (non-)optimal production size. In contrast, productivity has generally increased, especially between 2022 and 2023, due to improvements in technical efficiency and technological advances. These results underline the need for greater investment in digital tools and innovation to increase efficiency and productivity growth in the sector in the long term. The study provides valuable insights for policy makers, industry leaders and researchers and highlights the importance of digital transformation, workforce development and strategic investment. Eliminating persistent inefficiencies, accelerating technology adoption and addressing labor capacities will be critical to ensuring the sector’s future competitiveness in both domestic and international markets.
Keywords
construction sector; window data envelopment analysis; Malmquist productivity index; efficiency; productivity; accounting data.
Hrčak ID:
347624
URI
Publication date:
7.6.2026.
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