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by JumpCrisscross 3163 days ago
> Which...I don't think it is major reason for cost overruns

It's commonly called out as one of the driving reasons behind the horrible economics of American civil engineering [1].

> They haven't requested an increase, they have found out that to satisfy the engineering requirements of the project that more work has to be done

It's both. The change may be merited. If so, it should win--again--in a temporary re-auction. But refusing to market test an 82% cost increase is game theoretically begging to get screwed on pricing. Given American taxpayers get screwed on pricing for public-sector civil engineering (after accounting for land, labour and materials cost differences), I think it's a fair discussion to have.

[1] http://marroninstitute.nyu.edu/content/blog/is-u.s.-infrastr...
1 comments
yrb 3163 days ago
It is most definitely a fair discussion to have, and the bidding/financing/contractual system for these projects really does need to change to have better incentives.

I just don't think your incentives would produce better outcomes, from my perspective it would make things worse.

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JumpCrisscross 3163 days ago
I will make no attempt to defend the specific recommendations I mooted. There is better work, in any case, in the academic domain on fixing our flawed civil-engineering auction processes.

The problems anyone campaigning for auction reform runs into are three-fold. One, it's a boring problem with boring solutions. Two, there are vested interests. And three, Americans suffer from a just-world bias when it comes to infrastructure [1]. The latter is apparent even in this thread. It's difficult to find solutions when people vigorously defend a clearly-flawed system.

[1] https://en.wikipedia.org/wiki/Just-world_hypothesis

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yrb 3163 days ago
For sure. I don't know how you overcome the inertia of our societies structure to head towards something that would likely be better for the majority of citizens. Which is a problem in many more domains that just civil works auctions.

I can see how the recommendation you mooted would improve incentives in some procurement domains. Large civil works isn't one of them however.

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