Infrastructure projects frequently exceed their budgets in both time and cost, which often burdens the taxpayers. A significant percentage of these projects are neither complex nor unique, where the contract sum is a fraction of the contract sum of known megaprojects however has a higher percentage of cost overruns. The purpose of this study is to identify the cause, particularly the explanation behind these small and uncomplicated infrastructure projects' time and cost overruns, and to propose methods to avoid this wastage of taxpayer money. To achieve this purpose, a qualitative case study has been conducted within the scope of the Swedish Transport Administration's (Trafikverket) Investment division in the Eastern region in Uppsala, with a focus on pedestrian and bicycle paths. Empirical data has been gathered using Trafikverket's tools for deviation management, and semi-structured interviews were conducted with forecasters at Trafikverket's Investment division in Uppsala. A literature review has been made and were used to better interpret the empirical results. The identified causes are manifold but can be summarized as legal, political, and bureaucratic obstacles, communication issues, working methods, lack of experience and bad luck. The explanations for time and cost overruns can solely be attributed to the phenomenon of optimism bias, as this encompasses the forecaster's role as a decision maker in the project and the extent to which they could anticipate emerging situations. To mitigate optimism bias, the method of reference class forecasting is proposed. Furthermore, it is suggested to Trafikverket to reconsider the intervals of forecasting to be reviewed and adjusted according to the industry's way of setting forecasts on time. In conclusion, this study states that this is an important topic for future research in cost overruns in infrastructure projects. The recommendation is to focus on small and uncomplicated infrastructure projects. In addition, research must find the explanations for the causes of cost overruns before addressing the problem with appropriate methods.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:uu-515808 |
| Date | January 2023 |
| Creators | Linder, Fredrik |
| Publisher | Uppsala universitet, Industriell teknik |
| Source Sets | DiVA Archive at Upsalla University |
| Language | Swedish |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
| Relation | SAMINT-MILI ; 23047 |
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