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research-article

Oversight and Efficiency in Public Projects: : A Regression Discontinuity Analysis

Authors:

Juan Camilo SerpaAuthors Info & Claims

Management Science, Volume 65, Issue 12

Pages 5651 - 5675

https://doi.org/10.1287/mnsc.2018.3202

Published: 01 December 2019 Publication History

Abstract

In the United States, 42% of public infrastructure projects report delays or cost overruns. To mitigate this problem, regulators scrutinize project operations. We study the effect of oversight on delays and overruns with 262,857 projects spanning 71 federal agencies and 54,739 contractors. We identify our results using a federal bylaw: if the project’s budget is above a cutoff, procurement officers actively oversee the contractor’s operations; otherwise, most operational checks are waived. We find that oversight increases delays by 6.1%–13.8% and overruns by 1.4%–1.6%. We also show that oversight is most obstructive when the contractor has no experience in public projects, is paid with a fixed-fee contract with performance-based incentives, or performs a labor-intensive task. Oversight is least obstructive—or even beneficial—when the contractor is experienced, paid with a time-and-materials contract, or conducts a machine-intensive task.

This paper was accepted by Serguei Netessine, operations management.

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Cited By

Kadiyala BÖzer ÖŞimşek A(2024)Dual Value of Delayed IncentivesManufacturing & Service Operations Management10.1287/msom.2022.021826:5(1806-1825)Online publication date: 1-Sep-2024
https://dl.acm.org/doi/10.1287/msom.2022.0218
Baucells MGrushka-Cockayne YHwang W(2024)Managerial Mental Accounting and Downstream Project DecisionsManagement Science10.1287/mnsc.2021.0292970:12(8612-8630)Online publication date: 1-Dec-2024
https://dl.acm.org/doi/10.1287/mnsc.2021.02929
Jain NHasija SNetessine S(2021)Supply Chains and Antitrust GovernanceManagement Science10.1287/mnsc.2020.383367:11(6822-6838)Online publication date: 1-Nov-2021
https://dl.acm.org/doi/10.1287/mnsc.2020.3833

Index Terms

Oversight and Efficiency in Public Projects: A Regression Discontinuity Analysis
1. Applied computing
  1. Computers in other domains
    1. Computing in government
  2. Enterprise computing
    1. Business process management
2. Social and professional topics
  1. Computing / technology policy
  2. Professional topics
    1. Management of computing and information systems
      1. Project and people management
      2. System management

Index terms have been assigned to the content through auto-classification.

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Information & Contributors

Information

Published In

cover image Management Science

Management Science Volume 65, Issue 12

December 2019

508 pages

ISSN:0025-1909

DOI:10.1287/mnsc.2019.65.issue-12

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Copyright © 2019, INFORMS.

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INFORMS

Linthicum, MD, United States

Publication History

Published: 01 December 2019

Accepted: 29 June 2018

Received: 02 May 2017

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Cited By

Kadiyala BÖzer ÖŞimşek A(2024)Dual Value of Delayed IncentivesManufacturing & Service Operations Management10.1287/msom.2022.021826:5(1806-1825)Online publication date: 1-Sep-2024
https://dl.acm.org/doi/10.1287/msom.2022.0218
Baucells MGrushka-Cockayne YHwang W(2024)Managerial Mental Accounting and Downstream Project DecisionsManagement Science10.1287/mnsc.2021.0292970:12(8612-8630)Online publication date: 1-Dec-2024
https://dl.acm.org/doi/10.1287/mnsc.2021.02929
Jain NHasija SNetessine S(2021)Supply Chains and Antitrust GovernanceManagement Science10.1287/mnsc.2020.383367:11(6822-6838)Online publication date: 1-Nov-2021
https://dl.acm.org/doi/10.1287/mnsc.2020.3833

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