Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/141863
Authors: 
Oglend, Atle
Osmundsen, Petter
Lorentzen, Sindre
Year of Publication: 
2016
Series/Report no.: 
CESifo Working Paper 5886
Abstract: 
We examine drivers of cost overruns in Norwegian development projects in the oil and gas sector. The multivariate longitudinal econometric analysis employs a unique and detailed dataset consisting of 80 different projects between 2000 and 2015. Among the significant results, we find that the unexpected change in economic activity has a positive effect on the overruns; there is a considerable positive momentum in the transitional cost overruns; more experienced operators tend to incur less overruns; finally, that the size of the investment of the projects has a positive impact on the overruns. Further, we find evidence that the current economic activity matters to an extent, but it is the unexpected change in activity that is the pivotal factor.
Subjects: 
cost overrun
cost estimation
estimation error
JEL: 
C51
D22
C31
Document Type: 
Working Paper

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