nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2008‒06‒21
eight papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Assessing the assignation of public subsidies: Do the experts choose the most efficient R&D projects? By Néstor Duch-Brown; José García-Quevedo; Daniel Montolio
  2. Veille stratégique en entreprise multinationale - Une étude de cas auprès de la Deutsche Telekom AG By Rohrbeck, Rene
  3. The Economic Opportunity Cost of Capital for Canada - An Empirical Update By Glenn Jenkins; Chun-Yan Kuo
  4. Säänneltyä joustavuuutta: hankemekanismit kansainvälisessä ilmastopolitiikassa By Heikki Marjosola
  5. How does University Collaboration Contribute to Successful R&D Management? By Broström, Anders; Lööf, Hans
  6. Corporate Social Responsibility Through an Economic Lens By Reinhardt, Forest L.; Stavins, Robert N.; Vietor, Richard H.K.
  7. Bridge to Somewhere: The Value of Auckland's Northern Motorway Extensions By Arthur Grimes; Yun Liang
  8. Aid Effectiveness Revisited: Comparative Studies of Modalities of Aid to Asia and Africa By Hiroyuki Hino; Atsushi Iimi

  1. By: Néstor Duch-Brown (IEB & Universitat de Barcelona); José García-Quevedo (IEB & Universitat de Barcelona); Daniel Montolio (IEB & Universitat de Barcelona)
    Abstract: The implementation of public programs to support business R&D projects requires the establishment of a selection process. This selection process faces various difficulties, which include the measurement of the impact of the R&D projects as well as selection process optimization among projects with multiple, and sometimes incomparable, performance indicators. To this end, public agencies generally use the peer review method, which, while presenting some advantages, also demonstrates significant drawbacks. Private firms, on the other hand, tend toward more quantitative methods, such as Data Envelopment Analysis (DEA), in their pursuit of R&D investment optimization. In this paper, the performance of a public agency peer review method of project selection is compared with an alternative DEA method.
    Keywords: Subsidies, R&D, DEA, Multi Criteria Decision Analysis, “peer review”.
    JEL: O32 C61 H25
    Date: 2008
  2. By: Rohrbeck, Rene
    Abstract: English ------- In today’s fast changing environment large companies need to be fast and flexible to compete successfully against smaller, more agile competitors. Strategic Foresight encompasses a set of tools, processes and organisation forms that enable large companies to identify, assess, and act upon opportunities and threats, that have been identified by weak signals in the periphery. Companies using Strategic Foresight aim at enhancing their innovation capacity, manage disruptions, and shape the future by creating trends favourable to their business model or to their expansion strategy. Based on a literature review, we define a generic framework for the management of strategic foresight activities on the strategic, tactical and operational level and identify and discuss actors, methods and systems of strategic foresight. Furthermore building on an in-depth case study of the Deutsche Telekom Laboratories we shed light on the implementation of strategic foresight activities. Taking an exemplary project based on opportunities that have been identified by strategic foresight activities, we explore how the different insights have been combined to create the innovation concept and project proposal. We conclude that strategic foresight can successfully contribute to improving the innovation capacity of a firm by combining impulses from the market (customer needs) and technology (realization opportunities) perspective. French ------ Dans un environnement concurrentiel et en forte évolution technologique les grandes entreprises doivent réagir en temps réel pour s’imposer face à des concurrents petits et flexibles. La veille technologique propose des méthodes, des outils, des procédures et des formes d’organisation, qui permettent aux grandes entreprises, à partir de signaux faibles d’identifier et de traiter les opportunités et les risques. Les entreprises utilisant la veille stratégique améliorent leur capacité d’innovation, leur management de disruption et leurs capacités d'influencer l'avenir en jouant sur les tendances du marché qui sont favorables à leur stratégie d’expansion et leur « business plan ». A partir d’une analyse littéraire nous construisons un modèle, qui distingue les niveaux opérationnel, tactique et stratégique. Simultanément nous identifions les acteurs, les méthodes et les systèmes de la veille stratégique. Par une étude de cas élaborée avec les Laboratoires Deutsche Telekom nous discutons la mise en place de la veille stratégique. Grace à l’analyse d’un projet issu d’une impulsion de la veille stratégique, nous étudions la manière dont les informations de la veille ont été combiné pour générer un concept d’innovation et une proposition de projet. En conclusion nous pouvons montrer que la veille stratégique – en combinant des impulsions du marché (besoin du consommateur) et des impulsions technologiques (capacité de réalisation) – peut augmenter la capacité d’innovation.
    Keywords: veille stratégique; veille concurrentielle; veille technologique; veille consommateur; analyse du futur; strategic foresight; competitor foresight; consumer foresight; technology intelligence; future studies
    JEL: M0 M10
    Date: 2007–06–09
  3. By: Glenn Jenkins (Queen's University, Kingston, On, Canada); Chun-Yan Kuo (Queen's University, Kingston, On, Canada)
    Abstract: The social or economic discount rate is the threshold rate used to calculate the net present value of an investment project, a program, or a regulatory intervention to see whether the proposed expenditures are economically worthwhile to undertake. The size of the economic rate of discount has been a policy issue in Canada for many years. The debate has been primarily concerned with the empirical measurement of the economic opportunity cost of funds. The purpose of this paper is to reexamine and update the empirical estimation of what is the appropriate economic discount rate for Canada. The results suggest that estimates of the economic discount rate can range from 7.78 percent to 8.39 percent real. As a consequence, we conclude that for Canada an 8 percent real rate is an appropriate discount rate to use when calculating the economic net present value of the flows of economic benefits and costs over time.
    Keywords: discount rates, opportunity cost, project evaluation
    JEL: H43
    Date: 2007–07
  4. By: Heikki Marjosola
    Abstract: ABSTRACT : Kyoto Protocol’s Project-Based Mechanisms (Clean Development Mechanism, CDM and Joint Implementation, JI) add flexibility to international climate cooperation and emission trading schemes. The mechanisms reduce the costs of achieving the emission targets directly (cheaper implementation of the emissions reducing projects abroad) and indirectly (emission units earned increase the liquidity of the markets). While the carbon market has been running, some of the problems of the project-based markets have transpired. The CDM projects have centered largely on the biggest and richest developing countries, which also pollute a lot. The smaller developing countries that are more unstable and do not have as developed institutional capacity, are not as intriguing for risk-averting international capital. Though many developing countries are hosting CDM-projects, the centering of the market seems to feed itself. The reforms of the CDM market regulation try to decelerate this tendency (for example programmatic CDM, and new financing mechanisms). Industrialized countries also try to persuade the biggest developing countries to accept an emission target. Thereby they would no longer compete with developing countries, but with industrialized countries likely to host JI-projects. The development of the EU ETS is important from the point of view of project-based markets. In the future, the EU ETS will be governed more as a federate system under harmonized rules. The underlying problem of the international system, however, is the artificial dichotomy of the world into industrialized and developing countries. In the Emissions Trading Schemes, the different developing stages of the countries, regions and industrial operators can be considered much more efficiently. Linking of the already existing schemes provides a necessary step towards a more global and comprehensive Emissions Trading Scheme.
    Keywords: project-based mechanisms, CDM, JI, flexibility, emissions trading schemes, linking
    Date: 2008–06–13
  5. By: Broström, Anders (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology); Lööf, Hans (CESIS - Centre of Excellence for Science and Innovation Studies, Royal Institute of Technology)
    Abstract: The issue of through what processes R&D collaboration with universities affects a firms’ innovation performance remains under-researched. In particular, university relationships have not been fully integrated in the open innovation framework. This study explores the relationship between firms’ collaboration with universities and their capabilities for innovation, as perceived by R&D managers. Drawing on a series of interviews with R&D managers at 45 randomly selected firms collaborating with two research universities in Sweden, we explicitly recognise mechanisms through which university relationships contribute to successful R&D management.
    Keywords: University-Industry Link; Innovation; Technology transfer; R&D; Research collaboration
    JEL: I23 O31 O32
    Date: 2008–06–09
  6. By: Reinhardt, Forest L.; Stavins, Robert N.; Vietor, Richard H.K.
    Abstract: Business leaders, government officials, and academics are focusing considerable attention on the concept of “corporate social responsibility” (CSR), particularly in the realm of environmental protection. Beyond complete compliance with environmental regulations, do firms have additional moral or social responsibilities to commit resources to environmental protection? How should we think about the notion of firms sacrificing profits in the social interest? May they do so within the scope of their fiduciary responsibilities to their shareholders? Can they do so on a sustainable basis, or will the forces of a competitive marketplace render such efforts and their impacts transient at best? Do firms, in fact, frequently or at least sometimes behave this way, reducing their earnings by voluntarily engaging in environmental stewardship? And finally, should firms carry out such profit-sacrificing activities (i.e., is this an efficient use of social resources)? We address these questions through the lens of economics, including insights from legal analysis and business scholarship.
    Keywords: corporate social responsibility, voluntary environmental performance
    JEL: M14 L51 Q50
    Date: 2008–04–25
  7. By: Arthur Grimes (Motu Economic and Public Policy Research); Yun Liang (Motu Economic and Public Policy Research)
    Abstract: We estimate benefits that have resulted from extensions to Auckland's Northern Motorway since 1991. Population and employment rose substantially in locations near the new exits and to the north of the motorway extension, relative to developments elsewhere on the North Shore and in the broader Auckland Region. Land values also rose strongly near the new exits. Our approach to measuring net benefit uses changes in land values (after controlling for other factors) as a revealed preference indicator of value. We compare the estimated benefits with costs of the project to gain a measure of the project's benefit:cost ratio (B:C). Our results indicate that the gross benefit of the extensions from Tristram Avenue to Orewa is at least $2.3 billion (2004 NZ$s) compared with the estimated extension costs (discounted to 2004) of $366 million, giving a B:C ratio of at least 6.3, which exceeds the standard ratio of 4.0 used to approve roading projects in New Zealand. Our estimates take account of the possibility of diminution in value occurring elsewhere near the existing Northern Motorway network, but not in other areas of Auckland or elsewhere in the country. Conversely, they do not include any benefits that may be impounded in commercial property values in the CBD (and elsewhere) arising from increased accessibility to an enlarged labour pool.
    Keywords: infrastructure; transport investment; benefit:cost; Auckland motorway
    JEL: H43 H54 R42
    Date: 2008–05
  8. By: Hiroyuki Hino (Research Institute for Economics & Business Administration, Kobe University); Atsushi Iimi (The World Bank)
    Abstract: This paper provides a variety of evidence that shows that in Asia, aid leveraged private investment in the long run, while in Africa the correlation between aid and domestic investment was at best ambiguous. Aid in Africa was diametrically opposite to that of Asia in terms of the amounts the countries received, the sector compositions, the size of individual projects, and the intensity of donor involvement. The sharp contrast in aid effectiveness between Asia and Africa could be attributed at least in part to those differences in the modality of aid delivery. Based on the above analysis, the paper concludes with a few suggestions that could link aid more closely to private investment, and avoid pitfalls that Africa experienced.
    Keywords: official development assistance, aid effectiveness, foreign direct investment, East Asia, Sub-Saharan Africa
    JEL: O19 O20
    Date: 2008–03

This nep-ppm issue is ©2008 by Arvi Kuura. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.