An international experience on the evolution of road costs during the project life cycle

The Millennium Challenge Corporation (MCC) is a United States government development agency that promotes economic growth and poverty reduction in poor but well-governed countries. MCC is legislatively mandated to obligate total grant amounts at the start of a project and to implement within 5 years. As a result, MCC transport infrastructure projects are sensitive to cost variability. Existing quantitative literature on transport infrastructure costs in developing countries is sparse and concentrated on the construction phase. This study evaluated the cost variability for MCC road construction projects and identified mitigating strategies. The mean increase between funding authorization and final costs was 135%. Project cost estimates were most uncertain during the design phase, where the mean increase between funding authorization and engineer's estimates was 100%. Three policy strategies to manage variations between planned and actual costs are discussed: improving funding authorization estimates, improving contingency policies, and using economies of scale in procurement packaging.

• Record URL:
  • https://doi.org/10.1016/j.tranpol.2016.02.010
• Record URL:
  • http://www.sciencedirect.com/science/article/pii/S0967070X16300580
• Availability:
  • Find a library where document is available. Order URL: http://worldcat.org/oclc/29485010
• Supplemental Notes:
  • Abstract reprinted with permission of Elsevier.
• Authors:
  • Chong, Uven
  • Hopkins, Omar
• Publication Date: 2016-5

Language

• English

Media Info

• Media Type: Web
• Features: Figures; References; Tables;
• Pagination: pp 60-66
• Serial:
  • Transport Policy
  • Volume: 48
  • Publisher: Elsevier
  • ISSN: 0967-070X
  • Serial URL: http://www.elsevier.com/locate/issn/096707X

Subject/Index Terms

• TRT Terms: Construction projects; Costs; Developing countries; Government funding; Infrastructure; Road construction
• Identifier Terms: Millennium Challenge Corporation
• Subject Areas: Construction; Finance; Highways; Planning and Forecasting;

Filing Info

• Accession Number: 01597223
• Record Type: Publication
• Files: TRIS
• Created Date: Apr 25 2016 2:07PM