Technical Paper Session I-A - Escalation: How Much is Enough?

Escalation rates are a fiercely debated subject. Escalation is determined by dynamic relationships between numerous factors. They include acts of nature, interest rates, oil prices, global commodity markets, wars, wage rates, overall health of the economy, as well as supply and demand, which is ultimately affected by the aforementioned items. How much escalation is enough? We all are aware of the recent rapid escalation occurring, and are wondering if it will continue, or if it has been a temporary aberration. This paper examines historical escalation rates, as well as indications of future trends. In lieu of citing anecdotal evidence analysis methods including Monte Carlo, Neural Networks, Trend Impact Analysis and Delphi are examined in an attempt to determine future trends