Parametric estimating is a project management technique used to estimate costs or durations based on historical data and statistical relationships. It involves identifying key variables that influence the project and using them to create a mathematical model. For example, if a previous project cost $100,000 for 1,000 hours of work, the cost per hour can be used to estimate future projects. This method is particularly useful for large projects where detailed information may not be available. By applying historical data to similar tasks, project managers can generate more accurate estimates, helping to improve budgeting and scheduling efforts.