nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2011‒11‒14
nine papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Emerging trend of complementary currencies systems as policy instrument for environmental purposes: changes ahead? By Hélène Joachain; Frédéric Klopfert
  2. An evaluation of overseas oil investment projects under uncertainty using a real options based simulation model By Lei Zhu; ZhongXiang Zhang; Ying Fan
  3. Emergent multimedia clusters in the Lille, Lyon and Marseille metropolitan areas By Lusso Bruno
  5. Public-Private Partnerships and Infrastructure Provision in the United States By Eduardo Engel; Ronald Fischer; Alexander Galetovic
  6. “Social Return and Financing of Urban Regeneration Policies†By Iluminada Fuertes; David Cabedo
  7. The Evaluation of the Efficacy of the R&D European Funds in Piedmont By Davide Fantino; Giusy Cannone
  8. Measuring the Economic Impact of a Road Construction Project in an Area in Japan - A Simplified Spatial Computable General Equilibrium Modeling Approach - By Ha Thi Thu Trang; Yuzuru Miyata; Zhang Xu
  9. Albert Hirschman and his controversial research report By Ana Maria Bianchi

  1. By: Hélène Joachain; Frédéric Klopfert
    Abstract: Using complementary currencies systems as policy instruments for environmental purposes is a trend that seems to be progressively emerging in Europe. The Belgian Science Policy INESPO Project ,in the framework of which the research presented in this paper was carried out, is building on this emerging trend. The aim of the INESPO project is indeed to build new instruments for energy saving policies in the household sector based on the innovative coupling of Complementary Currencies (CC) and Smart Meters (SM). This CC-SM instrument is intended to promote both behavioural changes in everyday life and investment decisions leading to increased energy efficiency. In order to gain insights for the design of the CC part of the instrument, a first step was to turn to projects that had already used in the past CC as policy instrument for behavioural change. Two projects (NU-Spaarpas and E-portemonnee) that have pioneered this path in Europe were analysed to this purpose. This analysis revealed that, although those two projects had not been left unnoticed by academics, no taxonomy of their constitutive parameters had been developed yet. This paper is intended to contribute to the research on CC as policy instrument for environmental sustainability by proposing such a taxonomy for those CC projects. The resulting hierarchical classification of parameters has already been tested as a building tool during the design phase of the INESPO project. In the process, it became evident that the conceptual frameworks used to understand and explain behaviours had a major impact on the design of the CC-SM instrument and could lead to very different choices for key parameters of the system.
    Date: 2011–10
  2. By: Lei Zhu (Center for Energy and Environmental Policy Research, Institute of Policy and Management, Chinese Academy of Sciences); ZhongXiang Zhang (East-West Center); Ying Fan (Center for Energy and Environmental Policy Research, Institute of Policy and Management, Chinese Academy of Sciences)
    Abstract: This paper applies real options theory to establish an overseas oil investment evaluation model that is based on Monte Carlo simulation and is solved by the Least Squares Monte-Carlo method. To better reflect the reality of overseas oil investment, our model has incorporated not only the uncertainties of oil price and investment cost but also the uncertainties of exchange rate and investment environment. These unique features have enabled our model to be best equipped to evaluate the value of oil overseas investment projects of three oil field sizes (large, medium, small) and under different resource tax systems (royalty tax and production sharing contracts). In our empirical setting, we have selected China as an investor country and Indonesia as an investee country as a case study. Our results show that the investment risks and project values of small sized oil fields are more sensitive to changes in the uncertainty factors than the large and medium sized oil fields. Furthermore, among the uncertainty factors considered in the model, the investment risk of overseas oil investment may be underestimated if no consideration is given of the impacts of exchange rate and investment environment. Finally, as there is an important tradeoff between oil resource investee country and overseas oil investor, in medium and small sized oil investment negotiation the oil company should try to increase the cost oil limit in production sharing contract and avoid the term of a windfall profits tax to reduce the investment risk of overseas oil fields.
    JEL: Q41 Q43 Q48 G31 O13 O22 C63
    Date: 2011–11
  3. By: Lusso Bruno
    Abstract: The spatial, organizational and institutional proximity plays an important part in the geography of economic development (Boschma, 2005). It is therefore important to see what kinds of networks are being developed within the multimédia sector between the different actors of the Triple Helix (Etzkowitz and Leydersdorff, 1997): firms, training and R&D facilities, and public authorities. We will take for the example three French metropolitan areas: Lille, Lyon and Marseille. The dynamism of the social networks is supported by the development of a collective governance which associates public and private actors (Maillat and Kébir, 1999). So, initiatives have launched to facilitate strategic governance of emergent regional multimédia clusters. Three forms of governance (Tremblay and Rousseau, 2005) can be distinguished: public (Pole Images Nord-Pas-de-Calais in Lille), private (Imaginove in Lyon) and public-private partnership (Pole Sud Image in Marseille). These contrasted situations result from internal conflicts in the different industries of the multimedia sector. These structures have launched several similar actions in order to the constitution of social networks. Principles are inspired by the Competitivness Clusters and Michael Porter’s theories (2000). We can summarize them in the following way: - Interprofessional meetings, - Pooling of the human resources of the companies from the cluster, - Training programme for employees and executives, - Calls for collaborative projects which associate industrial and academic partners, - Support to firms willing to try out innovative business approaches, - Support programme for companies seeking to compete internationally. But, collaboration between different firms was generally low or nonexistent in spite of several regional projects (Einright, 1996). Collaborations are still very recent, rarely include a cross-media approach and hesitate to develop partnerships with research units. Similarly, the three metropolitan areas suffer from the poor adaptation of the regional training offer, which is far too rich and diverse compared to the actual capacities of the regional moving picture economy. Companies, mainly SMEs, cannot hire many people and they hesitate to embark on international missions.
    Date: 2011–09
  4. By: Senay Oguztimur
    Abstract: The evaluation of transport projects has become increasingly complex. Different aspects have to be taken into account and the consequences of the problems are usually far reaching and the different policy alternatives are numerous and difficult to predict. Several pressure or action groups have also emerged causing an even more complex decision making process. The use of multi criteria analysis for the evaluation of transport projects has increased due to this increasing complexity of the problem situation. At the same time, the importance of stakeholders within this evaluation process should have been recognized. Researches on transport projects are generally carried out to provide information to policymakers that have to operate within restrictive parameters (political, economical, social, etc…). Researchers should therefore take greater account of the different priorities of stakeholders such as policymakers, private enterprises and households. These stakeholders should be incorporated explicitly in the evaluation process. The Analytic Hierarchy Process is one of the Fuzzy Multiple Criteria Decision Making methods. It can be applied in a very broad range of applications of decision problems. Logistics, urban planning, public politics, marketing, finance, education, economics are a part of this wide application area. In transport subjects it can be used for the evaluation of transport policy measures or decision making problems. Due to its wide range application area, it has been an exciting research subject for many different field researchers. The aim of this paper is to introduce AHP method and to offer how to benefit it for the preference of urban planners in transport problems. This paper is composed of two main parts. First part consists of the literature survey regarding with the AHP and its application areas. The advantage of methods had been mentioned. Second part focuses on a sample application of AHP technique. The study uses AHP technique to determine the selection criteria in the transhipment port selection decision-making process. Keywords: Analytic Hierarchy Process, Multi criteria analysis, Transshipment port selection.
    Date: 2011–09
  5. By: Eduardo Engel; Ronald Fischer; Alexander Galetovic
    Abstract: Spending on necessary infrastructure is likely to be cut back in coming decades, as the federal and state governments struggle with large debt burdens. This will hamper future growth, particularly given the dismal state of current infrastructure. The American Society of Civil Engineers estimates that, as a result of decades of insufficient investment, the infrastructure deficit in the United States amounts to $2.2 trillion. In particular, spending on roads is little more than a third of the estimated requirement of $186 billion per year. The lack of resources for infrastructure maintenance and improvement extends across all sectors, from levees to wastewater treatment, and from transportation to schools. In this context, public-private partnerships (PPPs) seem a godsend to replace the lack of government investment, by promising the availability of large amounts of resources for infrastructure projects. Despite these promises, the wave of PPPs that changed infrastructure provision in many countries during the last two decades only has had minor impact in the United States. While the UK financed $50 billion in transportation infrastructure via PPPs between 1990 and 2006, the US, an economy more than six times as large as the UK, only financed approximately $10 billion during this period. While some countries succeeded in harnessing PPPs to develop their infrastructure, most found that PPPs can lead to surprisingly bad outcomes. The object of this paper is to offer proposals that make it more likely that PPPs fulfill a useful role in the recovery of American infrastructure.
    Date: 2011
  6. By: Iluminada Fuertes; David Cabedo
    Abstract: This paper analyses an alternative measurement framework capable of capturing the return on investment of urban regeneration projects through a cost-benefit analysis. Financial returns on investment are calculated as the ratio between the benefits accruing from the performance of a given project and the funds involved in their implementation. Both, benefits and funds, must be named in monetary terms. However in urban regeneration projects, due to their dual economic and social nature, is more difficult to quantify the profits generated because most of them are subjective (greater quality of life, better community welfare, etc.). There is a wide array of value taking place in a urban regenerative process (economic value, blended value, social value) some of which are measurable in a traditional Investment/Return framework (with its implicit economic returns assumption) and more of which are not so that they remain partially hidden from stakeholders. Based on the foregoing, the purpose of this study is twofold: to go deeply on the cost-effectiveness ratio of urban regeneration projects through consideration of social impacts and to analyze some new alternative funding formulas that arise particularly in a time of financial constraint. The papers argues that the SROI (Social Return On Investment) method appears as the most appropriate measurement tool to capture the full public benefit as well as the Tax Increment Financing and the Joint European Support for Sustainable Investment in City Areas –Jessica, seem to be two innovative financing formulas based on a market approach.
    Date: 2011–09
  7. By: Davide Fantino; Giusy Cannone
    Abstract: This paper provides some empirical evidence of the impact of two policy measures, aiming at supporting innovative activity of small and medium firms in Piedmont. Both measures use European Structural Funds, but are managed at a regional level. Measure 2.1b, a concessional loan aiming at stimulating the introduction of innovative plants, machinery and equipments, had positive effects on investments, assets and sales in the short run; but there are hints that investments could have been anticipated from already scheduled projects in the following periods. Measure 2.6b, a free grant aiming at stimulating research activity of firms, had positive effects on intangible investments and capital, but this new knowledge does not seem to be able to directly impact on the production process of the firm. When evaluating the effect for specific groups of firms, for both measures we do not find stronger effects for firms characterized by a high intensity of subsidy. When considering firms with a high cost of capital, we find that Measure 2.1b significantly reduced the interest rate asked by the lenders also after the end of the project, while Measure 2.6b had not been effective at all.
    Date: 2011–09
  8. By: Ha Thi Thu Trang; Yuzuru Miyata; Zhang Xu
    Abstract: The study region named San-En-Nanshin region (includes Aichi, part of Nagano and Shizuoka prefecture) is considered as a model of integrated dispersed regions and taken into the National Comprehensive Development Plan of Japanese government under Regional Revitalization Project. A large scale expressway connecting north and south named San-En-Nanshin Expressway is under construction in the study region. It is expected that with the completion of the expressway, the trade, production and consumption pattern of the region will significantly be changed. Therefore this research idea is to develop a model and to test empirically the impact of distance/ commuting time after construction of San-En-Nanshin Expressway upon firm's profit maximization and households' utility maximization behavior in San-En-Nanshin region. The research aims to draw an outline of a new integrated prefectural cross-border economic model of transport, land choice and the economy at firm and household level. In later parts, this research also intends to draw the location choice behavior and corresponding market equilibrium conditions based on transportation demand. As the results, combining this model and the short cut method for the evaluation of economic benefit of a transportation project under the general equilibrium framework, the total annual benefit after construction of San-En-Nanshin Expressway was estimated as 24.3 billion yen, at which 6.3 billion yen for business objective and 18 billion yen for leisure objective. The economic impact of San-En-Nanshin Expressway on Hamamatsu, Nanshin is largest as about 9.7 billion yen. Mito, Otawa, Ichinomiya, Tsukude get little impact. The total project cost of San-En-Nanshin Expressway is estimated as 500 billion yen or 1 trillion yen. If the project cost is about 500 billion yen, the construction of San-En-Nanshin Expressway passes the cost benefit criteria. In case of project cost of 1 trillion yen, this project is rejected under the cost-benefit principle. In this case, one must consider the way of increasing the benefit of the expressway by promotion of economic resource endowment in the sense of quality.
    Date: 2011–09
  9. By: Ana Maria Bianchi
    Abstract: During the early nineteen sixties, Albert Hirschman negotiated with the International Bank of Reconstruction and Development, part of the World Bank group, the financial support that he needed for an extended visit to several WB development projects scattered throughout the poor areas of the world. The document where he reports his visit was the matter of much controversy between the IBRD staff and Hirschman. One of the major points of disagreement was the latter´s refusal to employ the technique of cost-benefit analysis, then very popular at the WB, as a measure of the success of a project. Hirschman claimed that a one-dimensional scale was unable to grasp the various indirect effects of a project, which, he argued, were so varied as to escape detection by one or even several criteria uniformly applied to all projects. The paper claims that the strong negative reaction that Hirschman found among the WB economists was a crucial factor in his decision to leave the strict realm of economics and to embrace the broader social sciences themes of his subsequent writings.
    Keywords: Hirschman, World Bank, economic development, development economics
    JEL: B20 B31 O1
    Date: 2011–10–26

This nep-ppm issue is ©2011 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.
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