Critics Don't Understand Behavioral Science

Abstract

The paper argues that if you want to get cost estimates right for large capital investment projects, you need to unlearn conventional cost forecasting, with its century-long record of getting cost estimates wrong. Instead you need to learn behavioral science, because behavior, and not artifacts, is the main problem in getting cost forecasts right.

Keywords: Cost Overrun; Cost Underestimation; Cost Forecasting; Root Causes of Cost Overrun; Behavioral Science; Optimism Bias; Strategic Misrepresentation; Delusion; Deception; Moral Hazard; Agency; Reference Class Forecasting; De-Biasing