Modern tools for holistic assessment of ambiguity and risk: a case study of three Latin American Mega Transport Projects

Abstract The objective of this article has been to use Fuzzy Set Theory (FST) to assess the construction risks of three mega transport projects (MTPs) in Latin America and illustrate the relative importance of ambiguous risk factors in this region. The selected multiple-case study comprised the following three cases: Ferroanel from Sao Paulo in Brazil; Central Railway of Uruguay; and Line 1 of the Bogota Metro in Colombia. By applying FST to this set of MTPs, which includes projects developed in different institutional contexts, this paper shows that ill-defined construction risks are especially important in megaprojects in Latin America. Consequently, it also reveals that risk assessment should not be circumscribed to the sole use of numeric, probability-based analyses, which are incapable of considering ambiguous risks. On the contrary, this paper demonstrates the potential of using other methodologies, such as FST, which also incorporate perceptions of the institutional contexts in order to improve risk management in megaprojects of the region.