nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2008‒08‒06
five papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Coping with Costly Bid Evaluation in Online Reverse Auctions for IT Services By Radkevitch, U.L.; Heck, H.W.G.M van; Koppius, O.R.
  2. Reforming the agricultural extension system in India: What do we know about what works where and why? By Raabe, Katharina
  3. The Welfare Impacts of Local Investment Projects: Evidence from the Guatemala FIS By Pablo Ibarraran; Miguel Sarzosa; Yuri Suarez Dillon Soares
  4. Implications of bulk water transfer on local water management institutions: A case study of the Melamchi Water Supply Project in Nepal By Pant, Dhruba; Bhattarai, Madhusudan; Basnet, Govinda
  5. The IDE geographical simulation model : predicting long-term effects of infrastructure development projects By Kumagai, Satoru; Gokan, Toshitaka; Isono, Ikumo; Souknilanh, Keola

  1. By: Radkevitch, U.L.; Heck, H.W.G.M van; Koppius, O.R. (Erasmus Research Institute of Management (ERIM), RSM Erasmus University)
    Abstract: Online markets have dramatically decreased costs of search and communication for buyers. By contrast, costs of evaluating purchasing alternatives have become critical due to an overwhelming range of available options. When high, evaluation costs can offset potential gains from transactions and cause inefficiencies, e.g. by forcing buyers to abandon transactions without allocating contracts. While most previous studies treat evaluation costs as an exoge-nous factor, this study considers them endogenous. We identify several tactics (search, request for proposal preparation, budget announcement, bid filtering, and negotiation) that buyers at online markets can use to reduce their evaluation costs and hence influence project allocation. Using data from nearly 10 thousand transactions at a leading online marketplace for IT services, we show that buyers who use these tactics are more likely to allocate their project to a winner than buyers not using these tactics. Buyer experience also has a positive effect on allocation and, in addition, moderates the effectiveness of some of the tactics. As experience grows, budget announcement be-comes more effective in coping with evaluation costs and increases the likelihood of allocation, while the effectiveness of request for proposal preparation decreases. Together, these results shed more light on the buyer side of online reverse auctions, which leads to guidelines for improving the efficiency of online marketplaces.
    Keywords: evaluation costs;reverse auctions;online markets;IT services;outsourcing;buyer behavior;vendor selection
    Date: 2008–07–15
  2. By: Raabe, Katharina
    Abstract: "In order to realize agricultural potential and to increase agricultural yields, India's extension system has experienced major conceptual, structural, and institutional changes since the late 1990s. This paper reviews existing reform programs and strategies currently existing in agricultural extension in India. It distinguishes strategies that have been employed to strengthen both the supply and demand sides of service provision in the area of agricultural extension, and it reviews the effects of the demand- and supply-side strategies on the access to and the quality of agricultural extension services. The ultimate objectives are (1) to gain a view on what works where and why in improving the effectiveness of agricultural extension in a decentralized environment; (2) to identify measures that strengthen and improve agricultural extension service provision; and (3) to reveal existing knowledge gaps. Although the range of extension reform approaches is wide, this paper shows that an answer to the question of what works where and why is complicated by the absence of sound and comprehensive qualitative and quantitative impact and evaluation assessment studies. Even evidence from the National Agricultural Technology Project and the Diversified Agricultural Support Project of the World Bank, the women empowerment programs of the Danish International Development Agency, the Andhra Pradesh Tribal Development Project, and the e-Choupal program of the Indian Tobacco Company is subject to methodological and identification problems. Conclusions regarding the importance (1) of implementing both decentralized, participatory, adaptive, and pluralistic demand- and supply-side extension approaches; (2) of involving the public, private, and third (civil society) sectors in extension service provision and funding; and (3) of strengthening the capacity of and the collaboration between farmers, researchers, and extension workers are necessarily tentative and require further quantification. The paper seeks to inform policymakers and providers of extension services from all sectors about the need to make performance assessments and impact evaluations inherent components of any extension program so as to increase the effectiveness of extension service reforms." from Author's Abstract
    Keywords: Demand-driven and supply-driven agricultural extension services' extension service reforms, Agricultural extension services, Reforms, Demand driven, Supply driven, Governance,
    Date: 2008
  3. By: Pablo Ibarraran (Office of Evaluation and Oversight, Inter-American Development Bank); Miguel Sarzosa (Office of Evaluation and Oversight, Inter-American Development Bank); Yuri Suarez Dillon Soares (Office of Evaluation and Oversight, Inter-American Development Bank)
    Abstract: This paper assesses the welfare impacts of local investments projects in rural areas of Guatemala. Using census track data from two rounds of the Guatemalan population census, we find, as expected, that local investment in schools significantly boost enrollment and normal progression in school, that investments in water and sewerage significantly improved measures of access to water. We also show that the amount of investment matters. Using a dose-response functions based on generalized propensity score we also find that larger investments are associated with larger welfare improvements. We find no evidence of effectiveness of investments on child mortality. In terms of productive projects, there was a significant and consistent impact on consumption. We did not find evidence to suggest complementarities of impacts.
    Keywords: Social Investment Fund, Local Development, Propensity Score Matching, Impact Evaluation
    JEL: I31 H11 H41
    Date: 2008–02
  4. By: Pant, Dhruba; Bhattarai, Madhusudan; Basnet, Govinda
    Abstract: "To mitigate a drinking water crisis in Kathmandu valley, the Government of Nepal initiated the Melamchi Water Supply Project in 1997, which will divert water from the Melamchi River to Kathmandu city's water supply network. In the first phase, the Project will divert 170,000 cubic meters of water per day (at the rate of 1.97M3/sec), which will be tripled using the same infrastructure as city water demand increases in the future. The large scale transfer of water would have farreaching implications in both water supplying and receiving basins. This paper analyzes some of the major changes related to local water management and socioeconomics brought about by the Project and in particular the changes in the local water management institutions in the Melamchi basin. Our study shows that traditional informal water management institutions were effective in regulating present water use practices in the water supplying basin, but the situation will vastly change because of the scale of water transfer, and power inequity between the organized public sector on one side and dispersed and unorganized marginal water users on the other. The small scale of water usage and multiple informal arrangements at the local level have made it difficult for the local users and institutions to collectively bargain and negotiate with the central water transfer authority for a fair share of project benefits and compensation for the losses imposed on them. The process and scale of project compensation for economic losses and equity over resource use are at the heart of the concerns and debates about the Melamchi water transfer decision. The Project has planned for a one-time compensation package of about US$18 million for development infrastructure related investments and is planning to share about one percent of revenue generated from water use in the city with the supplying basin. The main issues here are what forms of water sharing governance, compensation packages, and water rights structures would emerge in relation to the project implementation and whether they are socially acceptable ensuring equitable distribution of the project benefits to all basin communities. In addition, these issues of the Melamchi project discussed in this paper are equally pertinent to other places where rural to urban water transfer projects are under discussion." authors' abstract
    Keywords: Institutional Impacts, Water transfer, Melamchi Water Supply Project, Urban water supply, Water rights, Local water management institutions, Kathmandu, Environmental management, Devolution,
    Date: 2008
  5. By: Kumagai, Satoru; Gokan, Toshitaka; Isono, Ikumo; Souknilanh, Keola
    Abstract: It is important to be able to predict changes in the location of populations and industries in regions that are in the process of economic integration. The IDE Geographical Simulation Model (IDE-GSM) has been developed with two major objectives: (1) to determine the dynamics of locations of populations and industries in East Asia in the long-term, and (2) to analyze the impact of specific infrastructure projects on the regional economy at sub-national levels. The basic structure of the IDE-GSM is introduced in this article and accompanied with results of test analyses on the effects of the East West Economic Corridor on regions in Continental South East Asia. Results indicate that border costs appear to play a big role in the location choice of populations and industries, often a more important role than physical infrastructures themselves.
    Keywords: Southeast Asia, East Asia, Economic geography, International economic integration, Geographical Simulation Model, Spatial economics
    JEL: D59 F29 O53 R49
    Date: 2008–06

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.