Frequency of Change Orders in Highway Construction Using Alternate Count-Data Modeling Methods
Publication: Journal of Construction Engineering and Management
Volume 136, Issue 8
Abstract
A common problem at state transportation agencies is the inability to complete projects within the original scope of work. Change orders, which are contractual documents issued to accommodate the additional work in a contract, are generally due to root causes such as design errors, unexpected site conditions, and weather conditions, and intermediate causes such as bidding characteristics. At the preaward phase of project management, an improved understanding of the factors that are associated with change orders will be of value and also can serve as a basis for taking steps to reduce concomitant contractual aberrations such as time delay and cost overruns. Recognizing that the occurrence of change orders is a count variable, this paper analyzes the frequency of change orders using a variety of count-modeling methods including the negative binomial, Poisson, zero-inflated negative binomial, and zero-inflated Poisson. Using 5 years of contract data from Indiana highway projects, appropriate models are estimated to assess the influence of project type, contract type, project duration, and project cost on the frequency of change orders.
Get full access to this article
View all available purchase options and get full access to this article.
Acknowledgments
The writers of this paper are grateful to the Joint Transportation Research Program which is administered by the Indiana Department of Transportation and Purdue University, for their support of the research project of which this work is a part. The assistance of Bobby McCullouch of Purdue University in data collection is acknowledged. The contents of this paper reflect the views of the writers, who are responsible for the facts and the accuracy of the data presented herein. The contents do not necessarily reflect the official views or policies of the Federal Highway Administration or the Indiana Department of Transportation, nor do the contents constitute a standard, specification, or regulation.
References
Bajari, P., and Tadelis, S. (2001). “Incentives versus transaction costs: A theory of procurement contracts.” Rand J. Econ., 32(3), 387–407.
Bordat, C., Labi, S., McCullouch, B., and Sinha, K. C. (2004). “An analysis of cost overruns and time delays of INDOT projects.” Tech. Rep. No. FHWA/JTRP/2004/07, West Lafayette, Ind., ⟨http://rebar.ecn.purdue.edu/jtrp_redesign/Research/ReportSearch.aspx⟩.
Carson, J., and Mannering, F. (2001). “The effect of ice warning signs on accident frequencies and severities.” Accid. Anal. Prev., 33(1), 99–109.
Chin, H. C., and Quddus, M. A. (2003). “Modeling count data with excess zeroes.” Sociol. Methods Res., 32(1), 90–116.
Gkritza, K., and Labi, S. (2008). “Estimating cost discrepancies in highway contracts: A multistep econometric approach.” J. Constr. Eng. Manage., 134(12), 953–962.
Hester, W., Kuprenas, J., and Chang, T. (1991). “Construction changes and change orders: Their magnitude and impact.” Document SD-66, The Construction Industry Institute, Austin, Tex.
Hinze, J., Selstead, G., and Mahoney, J. P. (1992). “Cost overruns on State of Washington construction contracts.” Transp. Res. Rec., 1351, 87–93.
Kockelman, K. (2006). “Safety impacts and other implications of raised speed limits on high-speed roads.” Technical Rep. Prepared for National Cooperative Highway Research Program, Transportation Research Board of the National Academies, Washington, D.C.
Lee, J., and Mannering, F. (2002). “Impact of roadside features on the frequency and severity of run-off-roadway accidents: An empirical analysis.” Accid. Anal. Prev., 34(2), 149–161.
Malyshkina, N., and Mannering, F. (2010). “Zero-state Markov switching count-data models: An empirical assessment.” Accid. Anal. Prev., 42(1), 122–130.
O’Brien, J. (1998). Construction change orders: Impact, avoidance, documentation, McGraw-Hill Professional, New York.
Rowland, H. J. (1981). “The causes and effects of change orders on the construction process.” MS thesis, Georgia Institute of Technology, Atlanta.
Shankar, V., Milton, J., and Mannering, F. (1997). “Modeling accident frequencies as zero-altered probability processes: An empirical inquiry.” Accid. Anal. Prev., 29(6), 829–837.
Thurgood, G. S., Walters, L. C., Williams, G. R., and Wright, N. D. (1990). “Changing environment for highway construction: The Utah experience with construction cost overruns.” Transp. Res. Rec., 1262, 121–130.
Vuong, Q. (1989). “Likelihood ratio tests for model selection and non-nested hypotheses.” Econometrica, 57, 307–334.
Washington, S. P., Karlaftis, M. G., and Mannering, F. L. (2003). Statistical and econometric methods for transportation data analysis, Chapman & Hall/CRC, London/Boca Raton, Fla.
Information & Authors
Information
Published In
Journal of Construction Engineering and Management
Volume 136 • Issue 8 • August 2010
Pages: 886 - 893
Copyright
© 2010 ASCE.
History
Received: Jul 21, 2009
Accepted: Jan 27, 2010
Published online: Jan 29, 2010
Published in print: Aug 2010
Authors
Metrics & Citations
Metrics
Citations
Download citation
If you have the appropriate software installed, you can download article citation data to the citation manager of your choice. Simply select your manager software from the list below and click Download.