We submit that the prevalence of the Planning Fallacy has been exaggerated and hence provide an explanation as to why this has occurred. Likewise, the Planning Fallacy and competing explanations can simultaneously account for cost deviations in social infrastructure projects. Based on our findings, we argue that optimism and pessimism bias co-exist. We therefore infer that at best 57% of projects may be explained by the presence of the Planning Fallacy. Our data shows that 43% of projects incurred a cost underrun from their contract award. We focus on the (honest) Planning Fallacy and hence aim to determine whether estimates are more optimistic than actual costs. We examine the cost performance of approximately U$ 6.5 billion worth of social infrastructure projects that were procured in Hong Kong and specifically the differences between their final accounts and the various types of estimates that were prepared prior to construction. The Planning Fallacy is at play in projects when optimism bias and/or strategic misrepresentation are present.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |