nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2009‒05‒16
four papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Half a Century of Public Software Institutions: Open Source as a Solution to Hold-Up Problem By Michael Schwarz; Yuri Takhteyev
  2. Estimation and Analysis of Expenses of In-Lieu-Fee Projects that Mitigate Damage to Streams from Land Disturbance in North Carolina By Templeton, Scott R.; Dumas, Christopher F.; Sessions, William T.; Victoria, Melanie
  3. The Cost Structure of Emissions Abatement through the Clean Development Mechanism By Rahman, Shaikh Mahfuzur; Larson, Donald; Dinar, Ariel
  4. Less Aid Proliferation and More Donor Coordination? The Wide Gap between Words and Deeds By Iñaki Aldasoro; Peter Nunnenkamp; Rainer Thiele

  1. By: Michael Schwarz; Yuri Takhteyev
    Abstract: We argue that the intrinsic inefficiency of proprietary software has historically created a space for alternative institutions that provide software as a public good. We discuss several sources of such inefficiency, focusing on one that has not been described in the literature: the underinvestment due to fear of holdup. An inefficient holdup occurs when a user of software must make complementary investments, when the return on such investments depends on future cooperation of the software vendor, and when contracting about a future relationship with the software vendor is not feasible. We also consider how the nature of the production function of software makes software cheaper to develop when the code is open to the end users. Our framework explains why open source dominates certain sectors of the software industry (e.g., the top ten programming languages all have an open source implementation), while being almost none existent in some other sectors (none of the top ten computer games are open source). We then use our discussion of efficiency to examine the history of institutions for provision of public software from the early collaborative projects of the 1950s to the modern "open source" software institutions. We look at how such institutions have created a sustainable coalition for provision of software as a public good by organizing diverse individual incentives, both altruistic and profit-seeking, providing open source products of tremendous commercial importance, which have come to dominate certain segments of the software industry.
    JEL: D45 D62 D64 H4 H44 L17 L3 N8 O3 O31 O43
    Date: 2009–05
  2. By: Templeton, Scott R.; Dumas, Christopher F.; Sessions, William T.; Victoria, Melanie
    Abstract: As North Carolinaâs economy has grown, the need to mitigate adverse impacts of land disturbance on aquatic ecosystems has also grown. When land disturbance adversely affects streams, a developer or the stateâs Department of Transportation can satisfy mitigation requirements through payment of fees to the stateâs Ecosystem Enhancement Program (EEP). EEP then manages a stream mitigation project on behalf of the responsible party. EEP has had regulatory authority to require stream mitigation for 10 years. The needs of EEP to reassess its mitigation fee and identify ways to reduce costs of the program have grown over the decade. The first objective of this study was to account for all EEP expenses of design-bid and design-bid-build projects. The second objective was to analyze the determinants of contractual expenses with a cost function. EEP has spent or committed to spend $46.34 million for 45 design-build or designbid-build projects to restore or enhance 191,374 ft. of streams. Expenses per foot have been $242.12. Given its mandate to cover expenses for stream mitigation, EEP must raise mitigation fees, especially those for urban projects, make changes to reduce project expenses, or do both. As the length of a restored or enhanced stream increases, the expenses per foot decrease. The decrease is more pronounced in undeveloped, rural areas. Thus, EEP could produce mitigation for less expense by financing fewer projects with longer reaches or by financing more projects in undeveloped, rural areas. Other states with in-lieu-fee programs for compensatory mitigation might also use these results to reduce contractual expenses.
    Keywords: Environmental Economics and Policy,
    Date: 2009
  3. By: Rahman, Shaikh Mahfuzur; Larson, Donald; Dinar, Ariel
    Abstract: This paper examines the cost structure of emissions abatement through different types of Clean Development Mechanism (CDM) projects. Alternative models for abatement costs are specified and estimated using CDM project-specific data. Empirical results indicate that there exist economies of scale in emission abatement through the CDM projects, and that the marginal cost of abatement significantly varies across different types of projects. The distribution of various CDM project types corresponds to the relative attractiveness of the types, in terms of the structure of the estimated marginal cost function. Thus, empirical results suggest that the CDM market operates efficiently and sends the right signals to the investors, which further explains the shying away from costly carbon sequestration projects funded by many international development agencies, such as the World Bank. Contrary to the hypothesis that that the marginal costs of abatement through CDM decrease over time due to experience or learning by doing, empirical results show non-decreasing marginal cost of abatement over time. This finding suggests that there may be other incentives to invest in certain types of CDM projects in specific locations, thus implying location-specificity of various investment opportunities. While non-decreasing marginal cost of abatement over time implies a tougher prospect for CDM in future commitment periods, the current growth pattern of the CDM suggests that this flexibility provision of the Kyoto Protocol is still highly attractive for the host and investor countries.
    Keywords: Cost Emissions Abatement Clean Development Mechanism, Environmental Economics and Policy,
    Date: 2009–04–30
  4. By: Iñaki Aldasoro; Peter Nunnenkamp; Rainer Thiele
    Abstract: We present a two-step approach of assessing whether major donors of foreign aid have met recent demands for less proliferated and better coordinated aid efforts. First, we calculate Theil indices revealing the concentration of each donor’s aid on recipient countries and specific aid sectors. Second, we map overlaps of aid from different donors and over time to analyze the degree of coordination. Our results point to a wide and persistent gap between the rhetoric of political declarations and the donors’ actual aid allocation during the period 1995-2006. Few donors have specialized on a limited set of recipients and aid sectors, and coordination has remained elusive
    Keywords: aid allocation, sector-specific commitments, Theil index, donor coordination, overlaps
    JEL: F35
    Date: 2009–04

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