Related papers: Planning Fallacy or Hiding Hand: Which Is the Bett…
We identify and document a new principle of economic behavior: the principle of the Malevolent Hiding Hand. In a famous discussion, Albert Hirschman celebrated the Hiding Hand, which he saw as a benevolent mechanism by which unrealistically…
This paper explores how theories of the planning fallacy and the outside view may be used to conduct quality control and due diligence in project management. First, a much-neglected issue in project management is identified, namely that the…
This paper takes stock of megaproject management, an emerging and hugely costly field of study. First, it answers the question of how large megaprojects are by measuring them in the units mega, giga, and tera, concluding we are presently…
Managing large-scale transportation infrastructure projects is difficult due to frequent misinformation about the costs which results in large cost overruns that often threaten the overall project viability. This paper investigates the…
Behavioral science has witnessed an explosion in the number of biases identified by behavioral scientists, to more than 200 at present. This article identifies the 10 most important behavioral biases for project management. First, we argue…
Dan Lovallo and Daniel Kahneman must be commended for their clear identification of causes and cures to the planning fallacy in "Delusions of Success: How Optimism Undermines Executives' Decisions" (HBR July 2003). Their look at…
Most cost-benefit analyses assume that the estimates of costs and benefits are more or less accurate and unbiased. But what if, in reality, estimates are highly inaccurate and biased? Then the assumption that cost-benefit analysis is a…
The article first describes characteristics of major infrastructure projects. Second, it documents a much neglected topic in economics: that ex ante estimates of costs and benefits are often very different from actual ex post costs and…
Strategic behaviour is one of the main explanations for cost overruns. It can theoretically be supported by agency theory, in which strategic behaviour is the result of asymmetric information between the principal and agent. This paper…
Consider a multi-phase project management problem where the decision maker needs to deal with two issues: (a) how to allocate resources to projects within each phase, and (b) when to enter the next phase, so that the total expected reward…
Counterfactual explanations are gaining prominence within technical, legal, and business circles as a way to explain the decisions of a machine learning model. These explanations share a trait with the long-established "principal reason"…
We examine the phase transition phenomenon for the Knapsack problem from both a computational and a human perspective. We first provide, via an empirical and a theoretical analysis, a characterization of the phenomenon in terms of two…
One of the most widespread human behavioral biases is the present bias -- the tendency to overestimate current costs by a bias factor. Kleinberg and Oren (2014) introduced an elegant graph-theoretical model of inconsistent planning…
Equipping LLMs with external tools effectively addresses internal reasoning limitations. However, it introduces a critical yet under-explored phenomenon: tool overuse, the unnecessary tool-use during reasoning. In this paper, we first…
Successful design of human-in-the-loop control systems requires appropriate models for human decision makers. Whilst most paradigms adopted in the control systems literature hide the (limited) decision capability of humans, in behavioral…
Present bias, the tendency to weigh costs and benefits incurred in the present too heavily, is one of the most widespread human behavioral biases. It has also been the subject of extensive study in the behavioral economics literature. While…
Decisions in organizations are about evaluating alternatives and choosing the one that would best serve organizational goals. To the extent that the evaluation of alternatives could be formulated as a predictive task with appropriate…
Business process models describe the way of working in an organization. Typically, business process models distinguish between the normal flow of work and exceptions to that normal flow. However, they often present an idealized view. This…
Using a methodology similar to that used the in the worldwide research, the cost performance of Dutch large-scale transport infrastructure projects is determined. In the Netherlands, cost overruns are as common as cost underruns but because…
In classical planning, the goal is to derive a course of actions that allows an intelligent agent to move from any situation it finds itself in to one that satisfies its goals. Classical planning is considered domain-independent, i.e., it…