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Cost overruns in transportation infrastructure projects: Sowing the seeds for a probabilistic theory of causation

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  • Love, Peter E.D.
  • Ahiaga-Dagbui, Dominic D.
  • Irani, Zahir

Abstract

Understanding the cause of cost overruns in transportation infrastructure projects has been a topic that has received considerable attention from academics and the popular press. Despite studies providing the essential building blocks and frameworks for cost overrun mitigation and containment, the problem still remains a pervasive issue for Governments worldwide. The interdependency that exists between ‘causes’ that lead to cost overruns materialising have largely been ignored when considering the likelihood and impact of their occurrence. The vast majority of the cost overrun literature has tended to adopt a deterministic approach in examining the occurrence of the phenomenon; in this paper a shift towards the adoption of pluralistic probabilistic approach to cost overrun causation is proposed. The establishment of probabilistic theory incorporates the ability to consider the interdependencies of causes so to provide Governments with a holistic understanding of the uncertainties and risks that may derail the delivery and increase the cost of transportation infrastructure projects. This will further assist in the design of effective mitigation and containment strategies that will ensure future transportation infrastructure projects meet their expected costs as well as the need of taxpayers.

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  • Love, Peter E.D. & Ahiaga-Dagbui, Dominic D. & Irani, Zahir, 2016. "Cost overruns in transportation infrastructure projects: Sowing the seeds for a probabilistic theory of causation," Transportation Research Part A: Policy and Practice, Elsevier, vol. 92(C), pages 184-194.
    • Handle: RePEc:eee:transa:v:92:y:2016:i:c:p:184-194
    DOI: 10.1016/j.tra.2016.08.007
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    2. Giorgio Locatelli, 2018. "Why are Megaprojects, Including Nuclear Power Plants, Delivered Overbudget and Late? Reasons and Remedies," Papers 1802.07312, arXiv.org.
    3. Maryam Hussain Abal-Seqan & Shaligram Pokharel & Khalid Kamal Naji, 2023. "Key Success Factors and Their Impact on the Performance of Construction Projects: Case in Qatar," Sustainability, MDPI, vol. 15(4), pages 1-20, February.
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    6. Schubert, Daniel & Sys, Christa & Vanelslander, Thierry & Roumboutsos, Athena, 2022. "No-queue road pricing: A comprehensive policy instrument for Europe?," Utilities Policy, Elsevier, vol. 78(C).
    7. Sizi Dong & Mukhtar Ahmed & Vuttichai Chatpattananan, 2025. "Analysis of Key Factors of Cost Overrun in Construction Projects Based on Structural Equation Modeling," Sustainability, MDPI, vol. 17(5), pages 1-19, February.
    8. Love, Peter E.D. & Ahiaga-Dagbui, Dominic D., 2018. "Debunking fake news in a post-truth era: The plausible untruths of cost underestimation in transport infrastructure projects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 113(C), pages 357-368.
    9. Love, Peter E.D. & Ika, Lavagnon A., 2021. "The ‘context’ of transport project cost performance: Insights from contract award to final construction costs," Research in Transportation Economics, Elsevier, vol. 90(C).
    10. Bartlomiej Rokicki, 2022. "Cost Underruns in Major Road Transport Infrastructure Projects—The Surprising Experience of Poland," Sustainability, MDPI, vol. 14(21), pages 1-18, November.
    11. Munday, Max & Reynolds, Laura & Roberts, Annette, 2023. "Re-appraising ‘in-process’ benefits of strategic infrastructure improvements: Capturing the unexpected socio-economic impacts for lagging regions," Transport Policy, Elsevier, vol. 134(C), pages 119-127.
    12. James Odeck, 2019. "Variation in cost overruns of transportation projects: an econometric meta-regression analysis of studies reported in the literature," Transportation, Springer, vol. 46(4), pages 1345-1368, August.
    13. Love, Peter E.D. & Zhou, Jingyang & Edwards, David J. & Irani, Zahir & Sing, Chun-Pong, 2017. "Off the rails: The cost performance of infrastructure rail projects," Transportation Research Part A: Policy and Practice, Elsevier, vol. 99(C), pages 14-29.
    14. Love, Peter E.D. & Sing, Michael C.P. & Ika, Lavagnon A. & Newton, Sidney, 2019. "The cost performance of transportation projects: The fallacy of the Planning Fallacy account," Transportation Research Part A: Policy and Practice, Elsevier, vol. 122(C), pages 1-20.
    15. Chantal C. Cantarelli & David Oglethorpe & Bert Wee, 2022. "Perceived risk of lock-in in the front-end phase of major transportation projects," Transportation, Springer, vol. 49(2), pages 703-733, April.
    16. Temitope Seun Omotayo & Bankole Awuzie & Valerie Kenechukwu Obi & Saheed Ajayi & Lovelin Ifeoma Obi & Oluyomi Osobajo & Adekunle Oke, 2022. "The System Dynamics Analysis of Cost Overrun Causations in UK Rail Projects in a COVID-19 Epidemic Era," SAGE Open, , vol. 12(2), pages 21582440221, May.
    17. Abeysekara, Baudhi & Perera, Piyaruwan & Chhipi Shrestha, Gyan Kumar & Gunaruwan, Lalithasiri & Kumarage, Amal & Sadiq, Rehan & Hewage, Kasun, 2021. "Improving the capital deployment efficiency: An infrastructure investment planning process in transportation project," Research in Transportation Economics, Elsevier, vol. 88(C).

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