Mediating Effect of Innovation on the Relationship between Project Financing and Construction Cost Efficiency: Innovation Integrated Cost Efficiency Perspective

Empirical evidence from 283 construction industry professionals indicated that project finance greatly improves cost efficiency, and the effect is partly mediated by innovation. The decline in direct impact when introducing innovation verified the partial mediation, proving the proposed innovation-integrated cost efficiency (IICE) model correct. The model emphasizes digitalization, automation, and lean construction in minimizing costs. Structural equation modeling (SEM) established a sound model fit, and robustness tests like multigroup analysis (MGA) revealed that the mediation effect is conditional on firm size, project complexity, and digital maturity. The research indicates that companies with good financial planning and high innovation adoption experience better cost efficiency. Through the convergence of artificial intelligence (AI)-based forecasting, building information modeling (BIM), and other intelligent technologies, construction companies can improve performance and profitability. This research provides a theoretical contribution in presenting the IICE theory and a practical contribution through providing actionable insights for financial and technological planning harmonization. It highlights the strategic importance of innovation in cost containment and provides a framework for the sustainable management of construction costs.