Beyond the Socio-Economic Impact of Transport Megaprojects

Abstract

For more than two decades, scholars have been escalating asymmetric information issues in megaproject management linking them to enhanced public debt concerns. Most megaprojects turn out to be a burden on economy when constructions are completed. Authorities, meanwhile, continue to promote the advancement of megaprojects with overly optimistic public messages on expected socio-economic benefits. A combination of expertise in the topic, in-depth literature analysis, independent cost-benefit reassessment, and empirical survey of related documentation of three EU transport megaprojects shows political implications to be the essential causes of information asymmetries in megaproject management. Socio-economic over-estimations imply to be useful for obtaining and securing funding commitments at the political level, but then the real project value is often omitted from the assessment. This work takes a wider, strategic approach beyond the usual socio-economic reasoning. The article argues that socio-economic assessment practice is too narrow to grasp the full potential impact of a megaproject. Therefore, a strategic assessment should be performed by public authorities along with an appropriate funding mechanism. This work contributes to science by suggesting a direction to more constructive discussions between scholars and politicians that could lead to more effective future decisions on the overall sustainability of economies.