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on Project, Program and Portfolio Management |
| By: | Robin Mason (Department of Economics, University of Exeter and CEPR.); Juuso Välimäki (Aalto University School of Economics and HECER.) |
| Abstract: | We analyse a simple model of dynamic moral hazard in which there is a clear and tractable trade-off between static and dynamic incentives. In our model, a principal wants an agent to complete a project. The agent undertakes unobservable effort, which affects in each period the probability that the project is completed. We characterise the contracts that the principal sets, with and without commitment. We show that with full commitment, the contract involves the agent’s value and wage declining over time, in order to give the agent incentives to exert effort. The long-run levels of the value and wage depend on the relative discount rates of the principal and agent. We also characterise the set of sequentially rational equilibria, where the principal has no commitment power. |
| Keywords: | Principal-agent model, continuous time, moral hazard, project completion. |
| JEL: | C73 D82 J31 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:exe:wpaper:1314&r=ppm |
| By: | Thomas Greve; Michael G. Pollitt |
| Abstract: | One of the biggest challenges in the area of infrastructure investment is the provision of funding to finance activities. This paper presents an auction design which can reduce the financing cost of infrastructure investments by allowing the length of the regulatory funding period to be determined via an auction. The auction allows bidders to submit bids against a payment for periods of varying length. Thus instead of, for example, a fixed 20-year contract period, some bidders might want to bid for financing over a longer period, say 25 or 30 years. This can be desirable in terms of securing more favourable terms in the financial markets. Our auction design can secure efficiency and lower financing costs. Our auction is motivated by the auctions currently being undertaken by the UK energy regulator (Ofgem) for financing offshore transmission assets. Although the auction was designed with electricity transmission in mind, the auction could be used in other areas of infrastructure investments |
| Keywords: | Auctions, Contracts, Investments, Regulation |
| JEL: | D44 D86 E43 |
| Date: | 2013–11–27 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1348&r=ppm |
| By: | Rosa, Frederico |
| Abstract: | This document, intended to be discuss and criticized, aims for the implementation on the city of Barreiro, Portugal, of a Local Investment Agency. The final objective of such project is to allow entrepreneurs and investors to build in the city new ventures that can create employment, build an entrepreneurship culture, and develop local talent. It also focus on networking as the foundation to gain efficiency and economies of scale that can turn local and small SME´s into a large cooperation that, with the managerial and strategic help of the agency, can produce results in external markets. |
| Keywords: | PME; Start-ups; Agencia Investimento; Economia Local; Empreendedorismo; Financiamento; Capital de Risco; Emprego; Internacionalização; Networks; Estratégia |
| JEL: | F00 F12 F22 H89 M10 M13 M21 O43 O49 |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:51671&r=ppm |