Procedures for Dealing with Optimism Bias in Transport Planning

London: The British Department for Transport, Guidance Document, June 2004

61 Pages Posted: 13 Jun 2013

See all articles by Bent Flyvbjerg

Bent Flyvbjerg

University of Oxford - Said Business School

Carsten Glenting

Independent

Arne Rønnest

Independent

Date Written: June 2004

Abstract

The Supplementary Green Book Guidance on Optimism Bias (HM Treasury 2003) with reference to the Review of Large Public Procurement in the UK (Mott MacDonald 2002) notes that there is a demonstrated, systematic tendency for project appraisers to be overly optimistic; and that to redress this tendency appraisers should make explicit, empirically based adjustments to the estimates of a project’s costs, benefits, and duration. HM Treasury recommends that these adjustments be based on data from past projects or similar projects elsewhere, and adjusted for the unique characteristics of the project in hand. In the absence of a more specific evidence base, HM Treasury has encouraged departments to collect data to inform future estimates of optimism, and in the meantime use the best available data. In response to this, the Department for Transport (henceforth DfT), has contracted Bent Flyvbjerg in association with COWI to undertake the consultancy assignment, "Procedures for dealing with Optimism Bias in Transport Planning". The present Guidance Document is the result of this assignment.

Suggested Citation

Flyvbjerg, Bent and Glenting, Carsten and Rønnest, Arne, Procedures for Dealing with Optimism Bias in Transport Planning (June 2004). London: The British Department for Transport, Guidance Document, June 2004. Available at SSRN: https://ssrn.com/abstract=2278346

Bent Flyvbjerg (Contact Author)

University of Oxford - Said Business School ( email )

Park End Street
Oxford, OX1 1HP
Great Britain

Carsten Glenting

Independent ( email )

Arne Rønnest

Independent ( email )

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