The Political Economy of Project Delay

Uncertainty about how long it will take to secure approval for large-scale economic projects presents difficulties for policy makers in all industrialized countries. This paper attempts to determine the factors that influence the time required to get public acceptance for energy projects in Japan. It suggests the importance of distributional factors and, hence, the need to examine: 1) the structure of the bargaining environment; 2) the ability of interest groups to sustain opposition to or support for projects; 3) bargaining strategies employed; 4) uncertainty about outcomes; and 5) changing expectations, in explaining why compensation mechanisms operate more effectively in resolving some social disputes than others. It concludes that an analysis of Japanese experience in this area can contribute to an understanding of other social controversies and that the approach has utility to policy makers involved in developing controversial projects.