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Megaprojects and Risk: An Anatomy of Ambition
Promoters of multi-billion dollar land-use development megaprojects systematically misinform parliaments, the public and the media in order to get them approved and built. This book not only explores these issues, but suggests practical solutions drawing on theory and scientific evidence from the several hundred projects in twenty nations and five continents. It is of interest to students, scholars, planners, economists, auditors, politicians and concerned citizens.
215 pages, Paperback
First published February 13, 2003
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Displaying 1 - 6 of 6 reviews
June 29, 2009
An interesting article that was unfortunately extended into a book. Repetitive but worthwhile.
Takeaways: rail projects across the planet are much more likely to inflate costs and potential passenger numbers, but any big project, anywhere in the world, in the past 70 years is likely to go about 50% over-budget on average, with things like the DC Metro and Sydney Opera House going many multiples over. Plenty of reports of gaming the numbers from construction companies and transportation administrators in the pre-game period should keep everyone suspicious of such projects.
May 29, 2020
If you work for a corporation and upon reading this book you will use it to your masters' advantage, I will make sure to find you and do what Liam Neeson did to his daughter in Taken 1: I will lose you to French kidnappers. Then, Liam Neeson will call me and threaten to kill me. I will subsequently surrender and reveal that before buying the book he should start with a free whitepaper, and then buy the book, not the other way around.
June 3, 2015
Megaprojects and Risk: An Anatomy of Ambition (2003) by Bent Flyvbjerg is a dry but interesting look at how expensive projects are chronically over budget, under utilised and delivered late.
The book gives the strong impression that the big budget government and private projects like the Channel Tunnel, the Øresund Bridge and many rail projects are chronically misrepresented in financial modelling that precedes them.
Flyvberg and his team have analysed many big public infrastructure projects and have found that 9 out 10 cost more than planned, 9 out of 10 are late and 9 out of 10 are not utilised as much as projected. Roads projects, are, however, quite often used more than expected It’s a terrible record. The record of rail projects is the worst, Average traffic on rail projects was 61% of the forecast level and sometimes as low as 25%.
After looking at these projects the authors found that those involved in making plans had lots of pressure put on them to cook forecasts. Essentially the promoters of the projects are dishonest and are either after political gain or are set to build the project and personally benefit with the risk generally taken up by taxpayers.
The book suggests a framework for better assessment with a range of forecasts made and investigation of how close the forecasts are to what happens after the fact. They also suggest that private money be solicited and made to take some of the risk. If it can’t be obtained it is a good suggestion that the project was not really viable.
It could be argued that the projects that are not viable but that are huge achievements should be undertaken anyway. This is a legitimate point. However, deception in the initial phases should still be reduced as much as possible. Part of the problem is described by the authors as being that projects are sometimes chosen on the basis of who has the most dishonest figures.
It’s a really interesting book that anyone who believes in infrastructure deficits and that more public spending in infrastructure is required should definitely read.
The book gives the strong impression that the big budget government and private projects like the Channel Tunnel, the Øresund Bridge and many rail projects are chronically misrepresented in financial modelling that precedes them.
Flyvberg and his team have analysed many big public infrastructure projects and have found that 9 out 10 cost more than planned, 9 out of 10 are late and 9 out of 10 are not utilised as much as projected. Roads projects, are, however, quite often used more than expected It’s a terrible record. The record of rail projects is the worst, Average traffic on rail projects was 61% of the forecast level and sometimes as low as 25%.
After looking at these projects the authors found that those involved in making plans had lots of pressure put on them to cook forecasts. Essentially the promoters of the projects are dishonest and are either after political gain or are set to build the project and personally benefit with the risk generally taken up by taxpayers.
The book suggests a framework for better assessment with a range of forecasts made and investigation of how close the forecasts are to what happens after the fact. They also suggest that private money be solicited and made to take some of the risk. If it can’t be obtained it is a good suggestion that the project was not really viable.
It could be argued that the projects that are not viable but that are huge achievements should be undertaken anyway. This is a legitimate point. However, deception in the initial phases should still be reduced as much as possible. Part of the problem is described by the authors as being that projects are sometimes chosen on the basis of who has the most dishonest figures.
It’s a really interesting book that anyone who believes in infrastructure deficits and that more public spending in infrastructure is required should definitely read.
November 16, 2015
Academic critique of megaprojects, including studies, with suggestions for better governance. Pretty good if you're into that sort of thing.
tl;dr "Cost underestimation and overrun cannot be explained by error and seem to be best explained by strategic misrepresentation, namely lying, with a view to getting projects started."
"On the basis of the evidence presented above, we conclude that the traffic estimates used in decision making for rail infrastructure development are highly, systematically and significantly misleading. Rail passenger traffic forecasts are consistently and significantly inflated."
"Moreover, positive regional development effects, typically much touted by project promoters to gain political acceptance for their projects, repeatedly turn out to be non-measurable, insignificant or even negative"
I didn't highlight, but something about needing to include private capital in funding, which is better able to deal and plan for risk than sovereign guarantees.
tl;dr "Cost underestimation and overrun cannot be explained by error and seem to be best explained by strategic misrepresentation, namely lying, with a view to getting projects started."
"On the basis of the evidence presented above, we conclude that the traffic estimates used in decision making for rail infrastructure development are highly, systematically and significantly misleading. Rail passenger traffic forecasts are consistently and significantly inflated."
"Moreover, positive regional development effects, typically much touted by project promoters to gain political acceptance for their projects, repeatedly turn out to be non-measurable, insignificant or even negative"
I didn't highlight, but something about needing to include private capital in funding, which is better able to deal and plan for risk than sovereign guarantees.
March 29, 2016
If the book would be a bit more lengthy I would have rated it 4 stars as it is a very intelligent book as in that it is well structured, very objective and contains a lot of content even in the small number of pages it is composed of. It gives a good view of how strikingly irrational mega projects are being planned, financed and monitored. If you have an interest in uncertainty and decision making theories, then this is a great work providing practical meat on the bone of those theories. Marvellous, but a little too short...
April 21, 2017
Затянуто и нудно, но ок.
Displaying 1 - 6 of 6 reviews