 Cost escalations in the front-end of projects – empirical evidence from Norwegian road projectsMorten Welde and James Odeck Transport Reviews, 2017, vol. 37, issue 5, 612-630 Abstract: This paper investigates an issue largely ignored in the transport literature on cost overruns, namely, cost increases in the early project phase, long before the decision to build is made. This is the phase of project planning that is referred to as the front-end phase in the literature. The rationale of the study is that unless cost estimates during the front-end phase are relatively accurate, the wrong projects may be selected for further development. We first argue for why it is important to address cost escalation during the front-end phase of project planning. We then use Norwegian data to demonstrate the magnitude of cost escalations during the front-end phase of projects and in comparison to the implementation phase. We find that even in a sample of projects with relatively small cost overruns as in the case of Norway, there are substantial cost increases before the formal decision to build was made. This raises the issue of whether decisions and priorities taken at the early stages of project development are based on false information and whether this may lead to the wrong project concepts being selected. Date: 2017 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:taf:transr:v:37:y:2017:i:5:p:612-630 Ordering information: This journal article can be ordered from DOI: 10.1080/01441647.2016.1278285 Access Statistics for this article Transport Reviews is currently edited by Professor David Banister and Moshe Givoni More articles in Transport Reviews from Taylor & Francis Journals |
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