IDEAS home Printed from
   My bibliography  Save this paper

How (In)accurate Are Demand Forecasts in Public Works Projects? The Case of Transportation


  • Bent Flyvbjerg
  • Mette Skamris Holm
  • S{o}ren L. Buhl


This article presents results from the first statistically significant study of traffic forecasts in transportation infrastructure projects. The sample used is the largest of its kind, covering 210 projects in 14 nations worth US$59 billion. The study shows with very high statistical significance that forecasters generally do a poor job of estimating the demand for transportation infrastructure projects. The result is substantial downside financial and economic risks. Such risks are typically ignored or downplayed by planners and decision makers, to the detriment of social and economic welfare. For nine out of ten rail projects passenger forecasts are overestimated; average overestimation is 106 percent. This results in large benefit shortfalls for rail projects. For half of all road projects the difference between actual and forecasted traffic is more than plus/minus 20 percent. Forecasts have not become more accurate over the 30-year period studied. If techniques and skills for arriving at accurate demand forecasts have improved over time, as often claimed by forecasters, this does not show in the data. The causes of inaccuracy in forecasts are different for rail and road projects, with political causes playing a larger role for rail than for road. The cure is transparency, accountability, and new forecasting methods. The challenge is to change the governance structures for forecasting and project development. The article shows how planners may help achieve this.

Suggested Citation

  • Bent Flyvbjerg & Mette Skamris Holm & S{o}ren L. Buhl, 2013. "How (In)accurate Are Demand Forecasts in Public Works Projects? The Case of Transportation," Papers 1303.6654,
  • Handle: RePEc:arx:papers:1303.6654

    Download full text from publisher

    File URL:
    File Function: Latest version
    Download Restriction: no

    References listed on IDEAS

    1. Skamris, Mette K. & Flyvbjerg, Bent, 1997. "Inaccuracy of traffic forecasts and cost estimates on large transport projects," Transport Policy, Elsevier, vol. 4(3), pages 141-146, July.
    2. Leavitt, Dan & Ennis, Sean & McGovern, Pat, 1993. "The Cost Escalation of Rail Projects: Using Previous Experience to Re-Evaluate the CalSpeed Estimates," University of California Transportation Center, Working Papers qt2rt1w7xj, University of California Transportation Center.
    3. Mackie, Peter & Preston, John, 1998. "Twenty-one sources of error and bias in transport project appraisal," Transport Policy, Elsevier, vol. 5(1), pages 1-7, January.
    4. Henderson, P D, 1977. "Two British Errors: Their Probable Size and Some Possible Lessons," Oxford Economic Papers, Oxford University Press, vol. 29(2), pages 159-205, July.
    5. Maynard M. Hufschmidt & Jacques Gerin, 1970. "Systematic Errors in Cost Estimates for Public Investment Projects," NBER Chapters,in: The Analysis of Public Output, pages 267-315 National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:arx:papers:1303.6654. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (arXiv administrators). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.