nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2011‒05‒24
nine papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Project scheduling with resource capacities and requests varying with time By Hartmann, Sönke
  2. Appropriate Financial Instruments for Public-Private Partnership to Boost Cross-Border Infrastructural Development-EU Experience By Geest, Willem van der; Nunez-Ferrer, Jorge
  3. Beyond product architecture: Division of labour and competence accumulation in complex product development By Markus C. Becker; Francesco Zirpoli
  4. Entrepreneurial innovations and taxation By Haufler, Andreas; Norbäck, Pehr-Johan; Persson, Lars
  5. Separation of Ownership and Control: Delegation as a Commitment Device By Aristotelis Boukouras
  6. Team Incentives and Reference-Dependent Preferences By Kohei Daido; Takeshi Murooka
  7. Impact of University Intellectual Property Policy on the Performance of University-Industry Research Collaboration By Hiroyuki Okamuro; Junichi Nishimura
  8. Does Gender Affect Investors' Appetite for Risk?: Evidence from Peer-to-Peer Lending By Nataliya Barasinska
  9. A Hidden Role of Public Subsidy in University-Industry Research Collaborations By Hiroyuki Okamuro; Junichi Nishimura

  1. By: Hartmann, Sönke
    Abstract: This paper discusses an extension of the classical resource-constrained project scheduling problem (RCPSP) in which the resource availability as well as the resource request of the activities may change from period to period. While the applicability of this extension should be obvious, we provide a case study in order to emphasize the need for the extension. A realworld medical research project is presented which has a structure that is typical for many other medical and pharmacological research projects that consist of experiments. Subsequently, we provide a mathematical model and analyze some properties of the extended problem setting. We also discuss how priority rule based heuristics for the RCPSP can be applied to the extended problem. In addition to the priority rules themeselves, we outline a framework for randomized priority rule methods. In order to provide a basis for experiments, we propose an adaptation of standard RCPSP test instances to the extended version of the problem. Finally we report the computational results of the priority rule methods. --
    Keywords: Project Management and Scheduling,Temporal Constraints,Resource Constraints,Priority Rules,Computational Results,Case Study
    Date: 2011
  2. By: Geest, Willem van der (Asian Development Bank Institute); Nunez-Ferrer, Jorge (Asian Development Bank Institute)
    Abstract: The member states of the European Union (EU) and the EU institutions have increasingly been using public-private partnerships (PPPs) to accelerate the development of (ambitious) trans-national infrastructure. This paper argues that in the EU (i) private sector partners remain risk-averse; and (ii) risk-pooling across a larger number of tax-payers tends to reduce the cost of risk to zero, making EU funds highly desirable and sought after for public infrastructure development. This paper argues that private equity has not been forthcoming to the extent that had been expected by those propagating this method of finance. In those instances where private non-publicly guaranteed resources have been used, the distribution of risks between public and private partners remained asymmetric, with public governmental bodies carrying the financial risks, which ultimately may become a contingent liability for the country’s public finances. However, EU and European Investment Bank (EIB) public funding is used not simply because the risks are spread more widely, but rather because EU rules and regulations for using such funds lead to better preparation of projects and greater efficiency gains in project implementation and delivery.
    Keywords: public-private partnerships; trans-national infrastructure; european union institutions; european union; public infrastructure development
    JEL: G32 H44 O19
    Date: 2011–05–13
  3. By: Markus C. Becker (Strategic Organization Design Unit, University of Southern Denmark); Francesco Zirpoli (Department of Management, Universitˆ Ca' Foscari Venezia)
    Abstract: This paper considers the trade-off between leveraging external sources of innovation by outsourcing design and engineering activities and the ability to develop internal product development competences. The trade-off arises because the division of labor within and across firms' boundaries has a crucial role in shaping competence development processes, especially because the division of labor also influences opportunities for learning by doing. In new product development projects, learning by doing appears to be both a key determinant of competence development and a difficult-to-substitute form of learning. While the division of development tasks is often considered as guided by product architecture, we show that by decoupling the decisions concerning the product architecture and the allocation of development tasks, firms can realize the benefits of outsourcing such tasks while developing new internal competences. Drawing on a longitudinal case study in the automotive industry, we also identify a new organizational lever for shaping competence development paths and for designing firm boundaries. This lever consists in alternating different task allocation schemes over time for different types of development projects. We show why this is a novel solution, what its underlying logic is, and how it enables alleviating the trade-off between the benefits of leveraging external sources of innovation and the opportunities for competence development provided by in-house design and engineering. We discuss implications for theories of organizational boundary design and innovation management.
    Keywords: innovation management; organizational boundaries; outsourcing; product architecture; modularity; new product development; template process; automotive industry; Fiat
    JEL: L22 L62 M10 O32
    Date: 2011–05
  4. By: Haufler, Andreas; Norbäck, Pehr-Johan; Persson, Lars
    Abstract: In many countries entrepreneurship is promoted through tax reductions for small businesses and by various government support schemes. We analyze the effects of such policies to subsidize small businesses in a setting where both the risk-return characteristics of the selected innovation project and the mode of commercialization chosen by entrepreneurs (market entry versus sale to an incumbent firm) are endogenous. We show that government programs to support small businesses foster market entry by entrepreneurs but, at the same time, give an incentive to choose low risk projects, due to the existence of limited loss o®set provisions. This points to a basic trade-off be- tween the goals of raising competition in technology-intensive markets and the desire of governments to foster risky `breakthrough' innovations.
    Keywords: business taxation; innovation; market entry
    JEL: H25 L13 M13 O31
    Date: 2011–05
  5. By: Aristotelis Boukouras (Georg-August-University Göttingen)
    Abstract: This paper provides a theoretical model for explaining the separation of ownership and control in firms. An entrepreneur hires a worker, whose effort is necessary for running a project. The worker\'s effort determines the probability that the project will be completed on time, but the worker receives some unobservable benefit by continuing his employment in the project. Thus, motivating the worker requires an efficiency wage which is inflated by the private benefit. The entrepreneur would pay out a smaller wage if he could commit to terminate the project if a delay occurs, but this threat is not credible, because the project has positive continuation value. We show that hiring a manager can solve this time-inconsistency issue and reduce the efficiency wage. We extend the model to include managerial moral hazard and we examine the conditions under which separation of ownership and control is more likely to happen. The model is consistent with many of the findings of the empirical literature, while it generates some new predictions too.
    Keywords: control structure; delegation; efficiency wage; entrepreneur; managerial contract; moral hazard; organizational hierarchy; private benefits; separation of owner-ship and control; time-inconsistency
    JEL: D86 G34 J31 L22 L26
    Date: 2011–05–10
  6. By: Kohei Daido (School of Economics, Kwansei Gakuin University); Takeshi Murooka (Department of Economics, University of California, Berkeley)
    Abstract: This paper examines a multi-agent moral hazard model in which agents have expectation-based reference-dependent preferences `a la K˝oszegi and Rabin (2006, 2007). The agents’ utilities depend not only on their realized outcomes but also on the comparisons of their realized outcomes with their reference outcomes. Due to loss aversion, the agents have a first-order aversion to wage uncertainty. Thus, reducing their expected losses by partially compensating for their failure may be beneficial for the principal. When the agent is loss averse and the project is hard to achieve, the optimal contract is based on team incentives which exhibit either joint performance evaluation or relative performance evaluation. Our results provide a new insight: team incentives serve as a loss-sharing device among agents. This model can explain the empirical puzzle of why firms often pay a bonus to low-performance employees as well as high-performance employees.
    Keywords: Moral Hazard, Team Incentives, Reference-Dependent Preferences, Loss Aversion, Joint Performance, Evaluation, Relative Performance Evaluation
    JEL: D86 M12 M52
    Date: 2011–05
  7. By: Hiroyuki Okamuro; Junichi Nishimura
    Abstract: Despite various expected advantages, university-industry research collaboration (UIC), a relationship between two different worlds, often faces serious difficulties. Thus, the performance of UIC depends on the research partners' strategies to bridge the gaps between them according to the institutional environment. In Japan, UIC has developed rapidly since the late 1990s based on drastic institutional changes regarding universities. We pay special attention to the role of the university intellectual property (IP) policy introduced after 2003 and empirically examine its impact on the performance of UIC projects. A clear and equitable IP policy that can be applied flexibly to the needs of partners would be optimal for a UIC to be efficiently managed. Otherwise, the project might face serious conflicts of interests and low incentive for cooperation. Using a sample of Japanese firms from our original survey, we find that the IP policy of partner universities indeed has a positive and significant impact on various performances of UIC projects, controlling for firm and project characteristics and considering potential selection bias from UIC participation.
    Keywords: intellectual property, research collaboration, small business, Japan
    JEL: D23 L24 O32 O34
    Date: 2011–05
  8. By: Nataliya Barasinska
    Abstract: This study investigates the role of gender in financial risk-taking. Specifically, I ask whether female investors tend to fund less risky investment projects than males. To answer this question, I use real-life investment data collected at the largest German market for peer-to-peer lending. Investors' utility is assumed to be a function of the projects expected return and its standard deviation, whereas standard deviation serves as a measure of risk. Gender differences regarding the responses to projects' risk are tested by estimating a random parameter regression model that allows for variation of risk preferences across investors. Estimation results provide no evidence of gender differences in investors' risk propensity: On average, male and female investors respond similarly to the changes in the standard deviation of expected return. Moreover, no differences between male and female investors are found with respect to other characteristics of projects that may serve as a proxy for projects' risk. Significant gender differences in investors' tastes are found only with respect to preferred investment duration, purpose of investment project and borrowers' age.
    Keywords: gender, investment choice, risk preferences
    JEL: G11 G21 J16
    Date: 2011
  9. By: Hiroyuki Okamuro; Junichi Nishimura
    Abstract: Contractual and organizational characteristics of university-industry research collaboration (hereafter UIC) are keys to its success. In this respect, government can play essential roles in UIC: Public subsidy for research and development (hereafter R&D) is not only an important financial support for UIC, but may also be a useful channel to promote trust along with contractual agreements and information sharing among the members, which results in effective coordination and thus the success of UIC. However, few empirical studies investigate the latter role of public R&D subsidy in UIC. Thus, using original survey data, this paper empirically examines and find that public R&D subsidy improves coordination in UIC, including trust formation, contractual agreements, and communication quality between the partners as well as commitment by the partners.
    Keywords: pubic subsidy, R&D, research collaboration, university, contract, trust
    Date: 2011–03

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