Measuring cost and time overruns: median-based metrics, reform effect, and simultaneous estimation

IF 6.8 1区工程技术 Q1 ECONOMICS

Transportation Research Part A-Policy and Practice Pub Date : 2025-07-08 DOI:10.1016/j.tra.2025.104587

James Odeck

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引用次数: 0

Abstract

This paper addresses three key gaps in transportation research on cost and time overruns: (1) the overuse of Mean Percentage Error (MPE), despite the Median Percentage Error (MdnPE) being more appropriate for skewed data; (2) limited evaluation of government interventions aimed at reducing overruns; and (3) the failure to account for the interdependence between cost and time overruns, leading to biased estimates. Using a dataset of 2,228 Norwegian road projects (1993–2016), we assess overruns using both MdnPE and MPE, evaluate the effects of major organizational reforms, and apply a Three-Stage Least Squares (3SLS) estimation to correct for endogeneity between cost and time overruns. Unlike some studies, we rely solely on statistically observable factors and avoid subjective explanations such as the planning fallacy or strategic misrepresentation.

Results show a median cost overrun of 4% (mean: 12%) and a median time overrun of 0% (mean: 18%), confirming a skewed data distribution. This demonstrates how MPE can exaggerate typical performance, while MdnPE offers a more representative measure of central tendency. Still, the choice between MPE and MdnPE should depend on the analytical objective—whether the goal is to highlight extreme cases or typical project performance.

We find that government reforms, particularly the introduction of full procurement competition and a Quality Assurance (QA) regime, significantly reduced overruns. However, results for time overruns vary by method: the Kruskal–Wallis test shows lower median time overruns during the QA and competition periods, while the 3SLS model—controlling for other project factors—reveals that the transition to full competition was associated with increased time overruns. This suggests that improvements in medians may reflect changing project composition rather than reform effects alone.

This study underscores the need to consider how overruns are evaluated and encourages the use of empirical evidence over speculative explanations like the planning fallacy.

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度量成本和时间超支：基于中间值的度量、改革效果和同步估计

本文解决了交通运输成本和时间超支研究中的三个关键空白：(1)尽管中位数百分比误差（MdnPE）更适合于倾斜数据，但平均百分比误差（MPE）的过度使用；(2)对旨在减少超支的政府干预措施的有限评估；(3)未能考虑到成本和时间超支之间的相互依赖关系，导致有偏见的估计。使用包含2228个挪威公路项目（1993-2016）的数据集，我们使用MdnPE和MPE评估超支，评估主要组织改革的影响，并应用三阶段最小二乘（3SLS）估计来纠正成本和时间超支之间的内生性。与一些研究不同，我们完全依赖于统计上可观察到的因素，避免主观解释，如计划谬误或战略失实陈述。结果显示，成本超支中位数为4%（平均值为12%），时间超支中位数为0%（平均值为18%），证实了数据分布的偏斜。这证明了MPE如何夸大典型的表现，而MdnPE提供了一个更具代表性的集中趋势度量。尽管如此，MPE和MdnPE之间的选择应该取决于分析目标——目标是突出极端情况还是典型的项目绩效。我们发现，政府改革，特别是引入全面采购竞争和质量保证（QA）制度，大大减少了超支。然而，时间超支的结果因方法而异：Kruskal-Wallis测试显示，在QA和竞争期间，时间超支的中位数较低，而3SLS模型（控制其他项目因素）显示，向全面竞争的过渡与时间超支的增加有关。这表明中位数的改善可能反映了项目构成的变化，而不仅仅是改革的影响。这项研究强调需要考虑如何评估超支，并鼓励使用经验证据，而不是像计划谬误这样的推测性解释。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Transportation Research Part A-Policy and Practice 工程技术-运输科技

CiteScore

13.20

自引率

7.80%

发文量

257

审稿时长

9.8 months

期刊介绍： Transportation Research: Part A contains papers of general interest in all passenger and freight transportation modes: policy analysis, formulation and evaluation; planning; interaction with the political, socioeconomic and physical environment; design, management and evaluation of transportation systems. Topics are approached from any discipline or perspective: economics, engineering, sociology, psychology, etc. Case studies, survey and expository papers are included, as are articles which contribute to unification of the field, or to an understanding of the comparative aspects of different systems. Papers which assess the scope for technological innovation within a social or political framework are also published. The journal is international, and places equal emphasis on the problems of industrialized and non-industrialized regions. Part A''s aims and scope are complementary to Transportation Research Part B: Methodological, Part C: Emerging Technologies and Part D: Transport and Environment. Part E: Logistics and Transportation Review. Part F: Traffic Psychology and Behaviour. The complete set forms the most cohesive and comprehensive reference of current research in transportation science.