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    Determining the Probability of Project Cost Overruns

    Source: Journal of Construction Engineering and Management:;2013:;Volume ( 139 ):;issue: 003
    Author:
    Peter E. D. Love
    ,
    Xiangyu Wang
    ,
    Chun-pong Sing
    ,
    Robert L. K. Tiong
    DOI: 10.1061/(ASCE)CO.1943-7862.0000575
    Publisher: American Society of Civil Engineers
    Abstract: The statistical characteristics of cost overruns experienced from contract award in 276 Australian construction and engineering projects were analyzed. The skewness and kurtosis values of the cost overruns are computed to determine if the empirical distribution of the data follows a normal distribution. The Kolmogorov-Smirnov, Anderson-Darling, and chi-squared nonparametric tests are used to determine the goodness of fit of the selected probability distributions. A three-parameter Frechet probability function is found to describe the behavior of cost overruns and provide the best overall distribution fit. The Frechet distribution is then used to calculate the probability of a cost overrun being experienced. The statistical characteristics of contract size and cost overruns were also analyzed. The Cauchy (
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      Determining the Probability of Project Cost Overruns

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    contributor authorPeter E. D. Love
    contributor authorXiangyu Wang
    contributor authorChun-pong Sing
    contributor authorRobert L. K. Tiong
    date accessioned2017-05-08T21:39:50Z
    date available2017-05-08T21:39:50Z
    date copyrightMarch 2013
    date issued2013
    identifier other%28asce%29co%2E1943-7862%2E0000584.pdf
    identifier urihttp://yetl.yabesh.ir/yetl/handle/yetl/58744
    description abstractThe statistical characteristics of cost overruns experienced from contract award in 276 Australian construction and engineering projects were analyzed. The skewness and kurtosis values of the cost overruns are computed to determine if the empirical distribution of the data follows a normal distribution. The Kolmogorov-Smirnov, Anderson-Darling, and chi-squared nonparametric tests are used to determine the goodness of fit of the selected probability distributions. A three-parameter Frechet probability function is found to describe the behavior of cost overruns and provide the best overall distribution fit. The Frechet distribution is then used to calculate the probability of a cost overrun being experienced. The statistical characteristics of contract size and cost overruns were also analyzed. The Cauchy (
    publisherAmerican Society of Civil Engineers
    titleDetermining the Probability of Project Cost Overruns
    typeJournal Paper
    journal volume139
    journal issue3
    journal titleJournal of Construction Engineering and Management
    identifier doi10.1061/(ASCE)CO.1943-7862.0000575
    treeJournal of Construction Engineering and Management:;2013:;Volume ( 139 ):;issue: 003
    contenttypeFulltext
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