Hundreds of Years of Pain, with Minimal Gain: Capital Project Cost Overruns, the Past, Present and Optimistic Future
The cost overrun phenomenon plagues capital projects worldwide. While policymakers and practitioners are aware of the potential for cost overruns to occur while procuring their projects, they have struggled to mitigate them. This article takes stock of cost overrun research and suggests two major pe...
| Main Authors: | , , |
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| Format: | Journal Article |
| Published: |
2022
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| Online Access: | http://hdl.handle.net/20.500.11937/90324 |
| _version_ | 1848765371037777920 |
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| author | Love, Peter Pinto, J.K. Ika, L.A. |
| author_facet | Love, Peter Pinto, J.K. Ika, L.A. |
| author_sort | Love, Peter |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | The cost overrun phenomenon plagues capital projects worldwide. While policymakers and practitioners are aware of the potential for cost overruns to occur while procuring their projects, they have struggled to mitigate them. This article takes stock of cost overrun research and suggests two major periods stand out. First, it focuses on the period from 1960 to 2002 and briefly reviews studies examining issues influencing cost estimation accuracy. Then, we look at the present period (2002 to 2022), where the Planning Fallacy theory has been championed and identified as the best way to explain why cost overruns occur. While the Planning Fallacy has filled the theoretical void in the literature, we question its legitimacy as it has been unable to effectively address the cost overrun phenomenon. Moving forward, we suggest a line of inquiry based on the theoretical polyphony of the ‘Fifth Hand’ principle, which offers a new framing to remedy cost overruns in capital projects. |
| first_indexed | 2025-11-14T11:34:11Z |
| format | Journal Article |
| id | curtin-20.500.11937-90324 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T11:34:11Z |
| publishDate | 2022 |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-903242023-03-01T02:48:05Z Hundreds of Years of Pain, with Minimal Gain: Capital Project Cost Overruns, the Past, Present and Optimistic Future Love, Peter Pinto, J.K. Ika, L.A. The cost overrun phenomenon plagues capital projects worldwide. While policymakers and practitioners are aware of the potential for cost overruns to occur while procuring their projects, they have struggled to mitigate them. This article takes stock of cost overrun research and suggests two major periods stand out. First, it focuses on the period from 1960 to 2002 and briefly reviews studies examining issues influencing cost estimation accuracy. Then, we look at the present period (2002 to 2022), where the Planning Fallacy theory has been championed and identified as the best way to explain why cost overruns occur. While the Planning Fallacy has filled the theoretical void in the literature, we question its legitimacy as it has been unable to effectively address the cost overrun phenomenon. Moving forward, we suggest a line of inquiry based on the theoretical polyphony of the ‘Fifth Hand’ principle, which offers a new framing to remedy cost overruns in capital projects. 2022 Journal Article http://hdl.handle.net/20.500.11937/90324 10.1109/EMR.2022.3219362 fulltext |
| spellingShingle | Love, Peter Pinto, J.K. Ika, L.A. Hundreds of Years of Pain, with Minimal Gain: Capital Project Cost Overruns, the Past, Present and Optimistic Future |
| title | Hundreds of Years of Pain, with Minimal Gain: Capital Project Cost Overruns, the Past, Present and Optimistic Future |
| title_full | Hundreds of Years of Pain, with Minimal Gain: Capital Project Cost Overruns, the Past, Present and Optimistic Future |
| title_fullStr | Hundreds of Years of Pain, with Minimal Gain: Capital Project Cost Overruns, the Past, Present and Optimistic Future |
| title_full_unstemmed | Hundreds of Years of Pain, with Minimal Gain: Capital Project Cost Overruns, the Past, Present and Optimistic Future |
| title_short | Hundreds of Years of Pain, with Minimal Gain: Capital Project Cost Overruns, the Past, Present and Optimistic Future |
| title_sort | hundreds of years of pain, with minimal gain: capital project cost overruns, the past, present and optimistic future |
| url | http://hdl.handle.net/20.500.11937/90324 |