Looking at newspapers nowadays, you are likely to see reports about public projects which turn out to be more expensive than estimated, sometimes even fourteen times the planned cost budget as in the case of the Sydney Opera. In order to gain a new insight on how this problematic could be improved, this paper aims to find correlations between the causes of deviations in public procurement and in the private market. Data from a on a global scale operating firm has been analyzed and compared to causes found in prior research. The questions this paper aims to answer are “Are causes and correlations found in smaller, private projects consistent with causes of cost overruns in public procurement?” and “Which implications and recommendations can be derived from the smaller dimension for the larger dimension of public procurement?” After introducing the theoretical framework and its theories, the individual cost deviations and correlations of the different segments are introduced and analysed. As a result, one can see how the rational behaviour model and asymmetric information influence the estimated cost and that, in order to decrease the problematic of cost overruns, estimation techniques and especially the way contracts are constructed have to be improved. Furthermore, positive correlations between the size of cost deviations and number of employees, possible chain of events and pay offs between
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:kau-37461 |
| Date | January 2015 |
| Creators | Massa, Lars |
| Publisher | Karlstads universitet, Handelshögskolan |
| Source Sets | DiVA Archive at Upsalla University |
| Language | English |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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