Perceived risk of lock-in in the front-end phase of major transportation projects

Abstract

Lock-in is defined as the tendency to continue with an inefficient decision or project proposal. The front-end phase is critical to project success, yet most studies have focused on lock-in in the implementation phase. Moreover, little is known about the way in which decision-makers perceive the risk of lock-in. In this paper we identify determinants of lock-in in the front-end phase and we reveal decision-makers’ perceptions of risk of lock-in. Our findings show that risk attitudes towards lock-in vary with the level of risk aversion. However, this is not sufficiently acute to drive the level of regret needed to avoid lock-in. This implies that decision-makers do not accurately assess the risk of lock-in and as such their risk perceptions are a mediating factor in the formation of lock-in. Based on escalation of commitment, path dependency, and prospect theory, the main contribution lies in providing a more comprehensive understanding of lock-in in the front-end phase.

Toward a Deeper Understanding of Optimism Bias and Transport Project Cost Overrun

“…Winch (2013) demonstrated through a case study of the Channel fixed link between France and the United Kingdom that committed escalation was a significant factor in the project’s budget and schedule overruns. The operation of escalation of commitment is similar to the concept of path dependency (Cantarelli et al, 2022). They are viewed as two complementary explanations for the lock-in phenomenon in project front-end planning.…”

Assessment criteria for inter-organizational collaboration in interconnected infrastructure projects

“…Despite the strong interdependencies between infrastructures, the development of infrastructures has often been executed relatively independently in silos (Carhart et al, 2018;Grafius et al, 2020). Additionally, the literature addressed the unsatisfactory performance of infrastructure projects, revealing that significant proportions of projects within the infrastructure sector fail to meet their intended budget and/or schedule (Cantarelli et al, 2022;Edwards, 2021;Eriksson et al, 2017;Lo et al, 2022). The complex interdependence and dynamic characteristics of interconnected infrastructure projects make them particularly challenging and risky to manage (Gondia et al, 2022).…”