Optimism and Misrepresentation in Early Project Development

Bent Flyvbjerg

Chapter 8 in Making Essential Choices with Scant Information, 2009, pp 147-168 from Palgrave Macmillan

Abstract: Abstract Major projects generally have the following characteristics: Such projects are inherently risky, due to long planning horizons and complex interfaces. Technology and design are often not standard. Decision-making and planning are typically multi-player processes with conflicting interests. Often there is “lock in” with a certain project concept at an early stage, leaving alternatives analysis weak or absent. The project scope or ambition level will typically change significantly over time. Statistical evidence shows that such unplanned events are often unaccounted for, leaving budget and time contingencies sorely inadequate. As a consequence, misinformation about costs, benefits and risks is the norm. The result is cost overruns and/or benefit shortfalls with a majority of projects.

Keywords: Reference Class; Major Project; Optimism Bias; Cost Overrun; Project Promoter (search for similar items in EconPapers)
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:pal:palchp:978-0-230-23683-7_8

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DOI: 10.1057/9780230236837_8

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