nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2012‒09‒03
nine papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Project Screening with Tiered Evaluation By Barbos, Andrei
  2. Imperfect Evaluation in Project Screening By Barbos, Andrei
  3. "Maximizing Benefits for Women: A Charitable Donation Allocation Problem" By Jenna Toussaint; Shang Wu; Kent D. Messer
  4. Making public sector reforms work : political and economic contexts, incentives, and strategies By Bunse, Simone; Fritz, Verena
  5. Channeling the final Say in Politics By Hans Gersbach; Oriol Tejada
  7. An Evaluation on Institution for Public Private Partnership (PPP) in Indonesia By Arief Bustaman; Arief Ramayandi
  8. New ICT sectors: Platforms for European growth? By Reinhilde Veugelers
  9. How to evaluate the impact of academic spin-offs on regional development By Donato Iacobucci; Alessandra Micozzi

  1. By: Barbos, Andrei
    Abstract: We study a Bayesian game of two-sided incomplete information in which an agent, who owns a project of unknown quality, considers proposing it to an evaluator, who has the choice of whether or not to accept it. There exist two distinct tiers of evaluation that differ in the benefits they deliver to the agent upon acceptance of a project. The agent has to select the tier to which the project is submitted for review. Making a proposal incurs a cost on the agent in the form of a submission fee. We examine the effect of a change in the submission fees at the two tiers of evaluation on the expected quality of projects that are implemented by the evaluator.
    Keywords: Evaluation; Project Screening
    JEL: D02 D82
    Date: 2012–08–14
  2. By: Barbos, Andrei
    Abstract: This paper studies a model in which an agent considers proposing a project of unknown quality to an evaluator, who decides whether or not to accept it. First, we show that there exist instances where an agent with a better track record of producing high-quality projects should be subjected to more stringent standards. Second, we show that an increase in the submission fee may lead to a decrease in the quality of projects that are implemented because of its effects on the evaluator's acceptance policy.
    Keywords: Evaluation; Project Screening; Regulatory Burden
    JEL: D02 D82 L50
    Date: 2012–06–14
  3. By: Jenna Toussaint (Department of Economics, University of Delaware); Shang Wu (Department of Applied Economics & Statistics, University of Delaware); Kent D. Messer (Department of Applied Economics & Statistics, University of Delaware)
    Abstract: Charitable foundations should endeavor to allocate their limited resources to best serve their constituents. However, few foundations use mathematical programming techniques despite overwhelming evidence of their superiority at selecting projects that yield higher levels of total benefits. The Fund for Women, a Delaware foundation that makes grants to programs serving women, is a notable exception to this pattern as they have begun using a novel “Hybrid Selection Model” that combines both binary linear programming and the heuristic rank-based model. Using data from the foundation, this study shows how the rank-based selection model that was previously used by this group, and currently in use by most foundations, yields lower levels of aggregate benefits compared to binary linear programming or goal programming. Using historical data from 2010, this research shows that a Hybrid model would have selected the top three ‘signature’ projects can maintain an above average project benefits while also securing a 180% improvement in the number of projects funded, 66% improvement in the number of women served, and a 139% improvement in total benefits achieved. The Fund for Women incorporated the Hybrid model in their selection process in 2012 and this paper describes the benefits achieved and the challenges with adopting this approach in a foundation context, including educating and achieving consensus amongst the selection committee and individual member’s project selection preferences that were outside of the initial model’s objective function.
    Keywords: Charitable Donation Allocation, Binary Linear Programming, Goal Programming, Hybrid Selection Model
    JEL: C44 C61 L31
    Date: 2012
  4. By: Bunse, Simone; Fritz, Verena
    Abstract: Supporting effective public sector reform is a major challenge that the World Bank and other agencies and stakeholders have been grappling with. It is increasingly recognized that political economy factors play a crucial role. However, beyond this broad proposition, specific questions arise: What country contexts are more/less propitious for public sector reforms and what reforms are likely to succeed where? And can more explicitly taking political economy challenges into account help to pursue public sector reforms even in less propitious contexts? This paper addresses these issues in two ways: first, it draws on the existing literature to identify key propositions about factors that can trigger or facilitate public sector reforms, and those that tend to work against (successful) reforms. Second, it investigates the experience of World Bank public sector operations over the decade 2000-2010. It finds that governments in many developing countries face incentives to initiate public sector reforms, but that at the implementation stage, political costs frequently outweigh potential gains; and hence reforms are abandoned or left to wither. Real breakthroughs have been achieved in countries experiencing major structural shifts and those having political leadership committed to higher-level goals. The review of operations shows that successful projects are significantly more widespread than the literature would lead to assume. Furthermore, it provides tentative evidence that investing in understanding political economy drivers has been associated with better project performance. Key implications are the need to differentiate between country contexts more clearly ex ante, concentrate more on reform implementation during windows of opportunity that are typically of limited duration, and design reforms with a clear plan of engagement with stakeholder incentives.
    Keywords: Public Sector Management and Reform,Public Sector Economics,National Governance,Public Sector Expenditure Policy,Intergovernmental Fiscal Relations and Local Finance Management
    Date: 2012–08–01
  5. By: Hans Gersbach (ETH Zurich, Switzerland); Oriol Tejada (ETH Zurich, Switzerland)
    Abstract: We examine how the final say in a sequence of proposals for local public project provision, financing, and redistribution can be channeled towards socially desirable outcomes, thereby breaking the dictatorial power of the last agenda-setter. Individuals are heterogeneous with some citizens benefiting from the public project (winners) and the rest losing (losers) relative to per-capita costs. Our main insight is that a simple ban on subsidies for the proposal-makers can achieve the purpose whenever the first proposal-maker is a winner and the second proposal-maker is a loser. Such a ban induces project winners to make efficient public project proposals that are however coupled with socially undesirable subsidy schemes. The best possible amendment for project losers is then to match the project proposal and to eliminate all subsidies. We further show that two-round proposal-making constitutes the minimal form of political competition yielding first-best outcomes and that restrictions on tax schemes are socially desirable.
    Keywords: Voters & Elections; Game Theory ; Social Choice & Welfare
    JEL: Q38 F12 H20 H70
    Date: 2012–08
  6. By: Glenn Jenkins (Queen's University, Canada and Eastern Mediterranean University, Cyprus); Andrey Klevchuk (Queen's University, Kingston, Canada)
    Abstract: The proposed El Kureimat Plant (module II) project is one of 19 new generation plants that the public electrical utility of Egypt plans to setup over its current planning horizon of 2005-2012. This paper reports on an integrated investment appraisal of the project. The project involves the construction of a 750 MW (2x250 MW gas turbine and 1x250 MW steam turbine) combine cycle power plant in the premises of the existing El Kureimat Power Station. The estimated total cost of the investment is 271.1 million Euros in nominal prices. The project, when completed, will provide 750 MW of additional capacity to the unified power system (UPS) in 2009. The proposed project is expected to save a substantial amount of natural gas for the state-controlled gas utility, which will be able to export the gas and earn foreign exchange for the Government.
    Keywords: thermal electricity, generation plants, combine cycle power plant, Egypt Integrated Appraisal.
    JEL: H43
  7. By: Arief Bustaman (Department of Economics, Padjadjaran University); Arief Ramayandi (Department of Economics, Padjadjaran University)
    Abstract: Infrastructure inadequacy is widely recognised as one of the main hindrance for further advancement of Indonesian economy. New development has been lacking for the past decade and maintaining existing facilities is no less a problem due to low government funding capacity. Public private partnership (PPP) schemes have been tapped to ease the problem since early 2000s. The progress, however, is unsatisfactory as the number of projects funded under such schemes to date is still very low. This paper argues that the problem is mainly due to drawbacks in the existing institution governing PPP schemes in Indonesia. It evaluates the existing institution, at national and subnational levels, for PPP in Indonesia and proposed viable policy recommendations to redesign the existing PPP’s institution to make it work better.
    Keywords: Public Private Partnership (PPP), institution, infrastructure
    JEL: H81 H54
    Date: 2012–08
  8. By: Reinhilde Veugelers
    Abstract: Europe's failure to specialise in new ICT sectors and firms is likely to hold back Europeâ??s post-crisis recovery. Europe lacks in particular leading platform providers, who are capturing most of the value in the new ICT ecosystem. â?¢ In-depth analysis of some specific new emerging ICT sectors shows that the problem in Europe appears not to be so much in the generation of new ideas, but rather in bringing ideas successfully to market. Among the barriers are the lack of a single digital market, fragmented intellectual property regimes, lack of an entrepreneurial culture, limited access to risk capital and an absence of ICT clusters. â?¢ The EU policy framework, particularly the Innovation Union and Digital Agenda EU 2020 Flagships, could better leverage the growth power for Europe of new ICT markets. The emphasis should move beyond providing support for infrastructure and research, to funding programmes for pre-commercial projects. But perhaps most important is dealing with the fragmentation in European digital markets.
    Date: 2012–08
  9. By: Donato Iacobucci (Dipartimento di Ingegneria dell'Informazione, Università Politecnica delle Marche); Alessandra Micozzi (Dipartimento di Ingegneria dell'Informazione, Università Politecnica delle Marche)
    Abstract: The paper proposes a framework to evaluate the impact of academic spin-offs at regional level and applies it to the context of the Marche region (Italy). Spin-off creation is the most complex way of commercializing academic research, compared to licensing and R&D collaborations, but with the highest potential impact on the regional context. The empirical analysis shows that when measured in quantitative terms the impact of spin-offs on local economies is rather low; however, there are qualitative direct and indirect effects that must be taken into consideration. By focusing on providing R&D services, spin-offs play an important role in promoting the up-grading of the regional industrial system, which is mainly based on small and medium-sized firms in low and medium-tech sectors. Though not very successful in terms of growth and job creation in the short run, spin-offs provide an entrepreneurial experience for a high number of young researchers. We can expect that in the longer terms these people can play an important role within the local system in the start-up of new companies or as agents of innovation for established firms.
    Keywords: spin-offs, technology transfer, regional innovation system
    Date: 2012–08

This nep-ppm issue is ©2012 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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