Accession Number:

AD1131691

Title:

Root Causes of Cost Growth in Major Defense Acquisition Programs (Revised)

Descriptive Note:

[Technical Report, Final Report]

Corporate Author:

INSTITUTE FOR DEFENSE ANALYSES ALEXANDRIA VA

Personal Author(s):

Report Date:

2020-09-01

Pagination or Media Count:

50

Abstract:

Year FY 1965-FY 2009 was unrealistic features in the programs initial baselines. This paper develops a theory of the root causes of this part of cost growth and provides statistical estimates of the model implied by this theory. Just upstream from most unrealistic program features lies competition for funding. Further upstream are circumstances that help explain why senior Department of Defense DoD decision makers sometimes approve unrealistically optimistic baselines. These are complex, but notably almost all occurred in periods during which funding made available to DoD was not sufficient to meet all reasonable demands imposed by such factors as force structure and the missions which DoD was expected to be able to perform. Yet further upstream are delays in adjusting the determinants of funding requirements to the funding provided. This causal chain accounts for the largest part although not all of cost growth in MDAPs. The statistical evidence for the model based on these factors is excellent.

Subject Categories:

  • Economics and Cost Analysis
  • Logistics, Military Facilities and Supplies
  • Administration and Management

Distribution Statement:

[A, Approved For Public Release]