The Scope and Future of Our Project on Costs

I was on a panel at Eno’s symposium on costs, talking with other teams investigating comparative construction costs. We worked off a list of questions Eno’s Robert Puentes had sent us before, knowing that the list was too long for five people (me, Eric, Laura Tolkoff, Ethan Elkind, Romic Aevaz) to cover in an hour. So for more completeness, here are my responses – and pay attention specifically to issues of scope and what we should be doing in the future. In particular, as we’re getting funded to do other things, we will likely have room in the budget to add a few more cases, and hire people who can put them together.

What were your key takeaways on the extent of our cost premium, and key cost drivers?

I blogged this just before the panel. The only major headers I’ll add are poor interagency coordination in the United States, especially for projects that are or touch commuter rail, and a political system full of real and imagined veto points. The imagined veto points are not unique to the US – the UK, Germany, and the Netherlands all have visible problems with excessive tunneling on high-speed rail projects coming from NIMBY demands, NIMBY demands that at least in the first two cases are paper tigers that the state can ignore if it doesn’t mind a few news cycles with negative headlines.

Questions on scope

There were three separate questions on this, since our approaches differ – Eno has more cases covered in less depth (and we made sure to pick disjoint comparison cases from theirs), Berkeley focuses on California projects. So we went through questions about what our respective scopes and limitations are:

  1. Could you walk us through the general scope and bounds of your work?
  2. What were some of the limitations you ran into when collecting information on costs/timeline, and what recommendations would you have to improve data reporting for projects?
  3. What are some of the lingering questions or areas for future study that your teams have flagged?

The answer to all three is that our scope – the six cases – looks at specific issues rather than general ones. The forest comprises trees and cannot be studied as an ecosystem until one understands the biology of the tree species therein. But then, understanding the biology of the tree species requires understanding the ecosystem they have evolved in; the reason we do cases simultaneously is that hearing about issues arising in one place informs our work on other places.

That said, I think it matters that none of our six cases is typical. Medium-cost environments like France, Germany, and Japan are unfortunately not in scope; I’ve read a lot of work on cot issues plaguing Grand Paris Express, but unfortunately not in any global or even just European comparative sense. All of our cases are Western (for infrastructure purposes Turkey is a Western country); this matters because, while European and East/Southeast Asian costs are broadly the same, both covering the entire global range short of American costs, there are notable differences in how they build, so it’s plausible that there re things one side does right that the other doesn’t in both directions. All of our cases are first-world or, in Istanbul’s case, 1.5th-world.

This means that we would like to add cases. Attractive targets include anything in Spain, to beef up our set of low-cost examples, and then cases that represent examples we didn’t study, that is places that are medium-cost, non-Western, or not in or in the penumbra of the developed world. My suspicion is that medium-cost examples will interpolate practices – Germany and France both vaguely appear to mix good Scandinavian or Southern European behavior with bad British and American behavior, each in its own way. But I do not know and that’s why we’d like to add cases. In middle-income countries like Russia, Mexico, Brazil, and China, and in low-income ones like India or the Philippines, I do not really know what to expect and my only explanation so far is completely different from any first-world pattern.

We should have a budget for this, but I don’t yet know how many cases we can juggle in addition to where we’re going to shift the main of our attention starting in early 2022, that is high-speed rail and a synthesis for the Northeast Corridor. Most likely other people will write the cases (for pay of course) and we will supervise in between looking at the history and technical data of the Northeast Corridor.

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