Lock-in and its Influence on the Project Performance of Large-Scale Transportation Infrastructure Projects: Investigating the Way in Which Lock-in Can Emerge and Affect Cost Overruns

By C. Cantarelli, Bent Flyvbjerg, Bert van Wee, Eric Molin. 2010

124 citations recorded by the source corpus.

Lock-in, the escalating commitment of decision makers to an ineffective course of action, has the potential to explain the large cost overruns in large-scale transportation infrastructure projects. Lock-in can occur both at the decision-making level (before the decision to build) and at the project level (after the decision to build) and can influence the extent of overruns in two ways. The first involves the ‘methodology’ of calculating cost overruns according to the ‘formal decision to build’. Due to lock-in, however, the ‘real decision to build’ is made much earlier in the decision-making process and the costs estimated at that stage are often much lower than those that are estimated at a later stage in the decision-making process, thus increasing cost overruns. The second way that lock-in can affect cost overruns is through ‘practice’. Although decisions about the project (design and implementation) need to be made, lock-in can lead to inefficient decisions that involve higher costs. Sunk costs (in terms of both time and money), the need for justification, escalating commitment, and inflexibility and the closure of alternatives are indicators of lock-in. Two case studies, of the Betuweroute and the High Speed Link-South projects in the Netherlands, demonstrate the presence of lock-in and its influence on the extent of cost overruns at both the decision-making and project levels. This suggests that recognition of lock-in as an explanation for cost overruns contributes significantly to the understanding of the inadequate planning process of projects and allows development of more appropriate means.

Subfields: Civil and Structural Engineering, Management, Monitoring, Policy and Law, Management Science and Operations Research

View Paper: https://www.semanticscholar.org/paper/3a85d5e8ad1449e0a5e80aa0a97ce8ba38d4db9b

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Citations in the corpus

Cost Overruns in Large-scale Transportation Infrastructure Projects: Explanations and Their Theoretical Embeddedness (2010, unknown): “…Transportation Infrastructure Projects: Explanations and Their Theoretical Embeddedness influences the magnitude of cost overruns, because the estimated costs at the real decision to build are usually lower than those at later stages of the decision-making process (Cantarelli et al. 2009).”
Quality Control and Due Diligence in Project Management: Getting Decisions Right by Taking the Outside View (2013, background): “…not fallen victim to lock-in at an earlier stage and that promoters are genuinely interested in understanding outcomes, which is not always the case, for instance where promoters have locked in on a certain design or construction interests dominate operations interests (Cantarelli et al., 2010).”
The Growth of Urban Building Stock: Unintended Lock‐in and Embedded Environmental Effects (2015, background): “This lock-in phenomenon has been recognized in other infrastructure systems, most notably transportation (Cantarelli et al. 2010; Coleman 2010), and some of this discourse has included land use (Barter 2004).”
Significant Factors Causing Cost Overruns in the Construction Industry in Afghanistan (2017, background): “[11] showed that cost overrun is a common issue in construction projects, which investigated 87 projects and found that on average 10.”
Characteristics of Cost Overruns for Dutch Transport Infrastructure Projects and the Importance of the Decision to Build and Project Phases (2012, background): “larger when the estimated costs at the informal decision to build were taken as a reference (Cantarelli et al., 2010)(12).”
Top Ten Behavioral Biases in Project Management: An Overview (2021, methodology): “Economists use related terms like the “sunk-cost fallacy” (Arkes & Blumer, 1985) and “lock-in” (Cantarelli et al., 2010b) to describe similar phenomena.”
What you Should Know about Megaprojects and Why: An Overview (2014, background): “Typically, lockin and escalation make it impossible to drop projects altogether, which is why megaprojects have been called the “Vietnams” of policy and management: “easy to begin and difficult and expensive to stop” (White, 2012; Cantarelli et al., 2010; Ross & Staw, 1993; Drummond, 1998).”