nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2011‒03‒26
five papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Costs and benefits of inter-departmental innovation collaboration By Cuijpers, Maarten; Guenter, Hannes; Hussinger, Katrin
  2. Modelling credit risk for innovative firms: the role of innovation measures By Chiara Pederzoli; Grid Thoma; Costanza Torricelli
  3. Foreign Investment in Infrastructure, Limited Public Funds, and Renegotiation By John Bennett
  4. Short-term borrowing for long-term projects: Are family businesses more susceptible to 'irrational' financing choices? By Peters, Bettina; Westerheide, Peter
  5. The Management of Uncertainty in Tourism: Strategic Paradoxes and Communication By Bouzon , Arlette; Devillard, Joëlle

  1. By: Cuijpers, Maarten; Guenter, Hannes; Hussinger, Katrin
    Abstract: Inter-departmental innovation collaboration facilitates innovation performance. At the same time, it has been identified as source of increased coordination costs. Using organizational information processing theory, this paper builds and tests hypotheses on the costs and benefits of innovation-related collaboration within firms. Based on a sample of 433 German manufacturing firms we show inter-departmental innovation collaboration to increase process innovation performance, but also to produce costs in terms of project delay and project termination. These costs, however, do not affect innovation performance at the firm level. This finding suggests firms to be well able to balance the costs and benefits of interdepartmental collaboration across their innovation project portfolio. Theoretical and managerial implications are discussed. --
    Keywords: Inter-departmental innovation collaboration,innovation performance,project delay,project termination
    JEL: O32 M54 O31
    Date: 2011
  2. By: Chiara Pederzoli; Grid Thoma; Costanza Torricelli
    Abstract: Financial constraints are particularly severe for R&D projects of SMEs, which cannot generally rely on equity markets and, in the EU, on a sufficiently developed VC industry. If innovative SMEs have to depend on banks to finance their R&D projects, it is particularly important to develop models able to estimate their probability of default (PD) in consideration of their peculiar features. Based on the signaling value of some innovative assets, the purpose of this paper is to show the importance to include them into models which have proved to be successful for SMEs. To this end, we take a logit model and test it on a unique dataset of innovative SMEs (based on PATSTAT database, EPO BULLETIN and AMADEUS) to estimate a two-year PD with default years 2006-2008. In the regression analysis the innovation-related variables are two in order to account for R&D productivity at the level of the firm and to consider the value of the inventive output. Our analyses first address measurement issues concerning innovation-related variable and then show that, while the accounting variables and the patent value are always significant with the expected sign, the patent number per se reduces the PD only in the presence of an appropriate equity level.
    Keywords: innovative SMEs; default probability; patent value
    JEL: G21 G32 C25 O31 O34
    Date: 2011–03
  3. By: John Bennett
    Abstract: We examine the interplay between limited public funds and renegotiation when a foreign firm invests in social infrastructure. It is found that the critical factor is how the finance constraint alters the threat point for the government in renegotiation. Through its effect on this threat point, a mild restriction on finance results in higher domestic welfare and total surplus, but a tighter restriction deters entry, even with the finance available being sufficient to cover the investor's total costs. Domestic welfare and the total surplus are non-monotonic in the availability of finance, with implications, for example, for project aid policy.
    Date: 2011–02
  4. By: Peters, Bettina; Westerheide, Peter
    Abstract: There are noticeable differences between the roles that various forms of credit financing play in family businesses and in other businesses. Family businesses take out more often bank loans specifically to finance investments and innovations, and they particularly often resort to the short-term and relatively expensive option of an overdraft. How can we explain these differences in financing choices? Do family businesses tend to use shorter-term, more expensive sources of financing because they face more restrictions than other or are there other motives such as financial independence at play? Our econometric approach to these issues is to study the financing behaviour and creditworthiness. For both of these aspects, we compare family businesses with non-family-run businesses that otherwise have the same characteristics. Our results do not confirm that family businesses are faced by stronger financial constraints but they indicate that family firms are prepared to accept higher financing costs in order to preserve their financial independence. --
    Keywords: Corporate financing,innovation,family businesses,financing restrictions
    JEL: G32 G31 M14
    Date: 2011
  5. By: Bouzon , Arlette; Devillard, Joëlle
    Abstract: The design of new tourism products necessarily enters into the realm of uncertainty. Such uncertainty concerns the product developed and its later use as much as the way the design project is conducted. It can be linked to events either within or outside the firm. It will be considered to be acceptable by the design team concerned as long as it remains within a field of tolerance (domain of performance, “margin for random effects”, etc.), with the risk relating to how to egress from that domain. The first section addresses the issue of uncertainty in design and concerns the developed product and its later use just as the way the design project is pursued. The second section focuses on decision-making and how the various risks that can affect the firm and its environment are taken into account.
    Keywords: Tourism; Innovation; Conception; Uncertainty; Communication; Decision
    JEL: O1 M1 L83
    Date: 2011–04–15

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