nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2014‒02‒21
seven papers chosen by
Arvi Kuura
Parnu College - Tartu University

  1. Making informed investment decisions in an uncertain world : a short demonstration By Bonzanigo, Laura; Kalra, Nidhi
  2. The Relation between Information and Heterogeneous Ability in Joint Projects - An experimental Analysis - By Gerlinde Fellner; Yoshio Iida; Sabine Kröger; Erika Seki
  3. How Industry Inventors Collaborate with Academic Researchers: The choice between shared and unilateral governance forms. By Bodas Freitas , Isabel Maria; Geuna, Aldo; Lawson, Cornelia; Rossi, Federica
  4. Long term impact of a major infrastructure project: the port of Gioia Tauro By Mario Genco; Emanuela Sirtori; Silvia Vignetti
  5. Institutional investment in infrastructure in developing countries : introduction to potential models By Inderst, Georg; Stewart, Fiona
  6. Selection of information sources for identifying technology trends: A comparative analysis By Nadezhda Mikova; Anna Sokolova
  7. Firms doing good : how do we know ? measurement of social and environmental results By Klein, Michael; Kaur, Sumeet

  1. By: Bonzanigo, Laura; Kalra, Nidhi
    Abstract: Governments invest billions of dollars annually in long-term projects. Yet deep uncertainties pose formidable challenges to making near-term decisions that make long-term sense. Methods that identify robust decisions have been recommended for investment lending but are not widely used. This paper seeks to help bridge this gap and, with a demonstration, motivate and equip analysts better to manage uncertainty in investment decisions. The paper first reviews the economic analysis of ten World Bank projects. It finds that analysts seek to manage uncertainty but use traditional approaches that do not evaluate options over the full range of possible futures. Second, the paper applies a different approach, Robust Decision Making, to the economic analysis of a 2006 World Bank project, the Electricity Generation Rehabilitation and Restructuring Project, which sought to improve Turkey's energy security. The analysis shows that Robust Decision Making can help decision makers answer specific and useful questions: How do options perform across a wide range of potential future conditions? Under what specific conditions does the leading option fail to meet decision makers'goals? Are those conditions sufficiently likely that decision makers should choose a different option? Such knowledge informs rather than replaces decision makers'deliberations. It can help them systematically, rigorously, and transparently compare their options and select one that is robust. Moreover, the paper demonstrates that analysts can use the same data and models for Robust Decision Making as are typically used in economic analyses. Finally, the paper discusses the challenges in applying such methods and how they can be overcome.
    Keywords: Energy Production and Transportation,Climate Change Economics,Debt Markets,Non Bank Financial Institutions,Climate Change Mitigation and Green House Gases
    Date: 2014–02–01
  2. By: Gerlinde Fellner; Yoshio Iida; Sabine Kröger; Erika Seki
    Abstract: We study voluntary contribution behavior of individuals who vary in their ability to contribute to a joint project under different information scenarios. We investigate a situation with two types who vary only in their external marginal return (low and high). Results of a laboratory experiment suggest that, when group members are not aware of the heterogeneity in their group, both types make the same nominal contributions. When agents are informed about the heterogeneity, contributions increase but differently by type. High types contribute only more with sufficient social exposure, i.e., when information on the type of the contributor is available. Low types, on the other hand, contribute only more when they are aware of the distribution of types, but have no information on the type of the contributor.
    Keywords: Public goods, Voluntary contribution mechanism, Heterogeneity, Information, Norms
    JEL: C9 H41
    Date: 2014
  3. By: Bodas Freitas , Isabel Maria; Geuna, Aldo; Lawson, Cornelia; Rossi, Federica (University of Turin)
    Abstract: We investigate under what circumstances firms (industry inventors) are more likely to engage in interactions where governance of the relationship is shared between the firm and the university, as opposed to interactions where the relationship is governed unilaterally by the firm. Using PIEMINV, an original dataset of European industry patents in the Italian region of Piedmont, we analyse the characteristics of inventors with diverse experience in projects involving interactions with universities, governed by institutional contracts or personal contracts. Our results suggest that reliance among inventors of the two forms of governance is almost equal, and that unilateral governance forms are preferred when there are high levels of trust among the parties based on embeddedness in local social and education networks. This is likely because it involves less cumbersome and more direct interactions. We find also that knowledge characteristics are not particularly important discriminants of the choice between governance forms: the advantage of shared governance seems to reside mainly in the possibility to mitigate monitoring and asymmetric information problems in contexts of relatively low levels of mutual knowledge and trust.
    Date: 2014–01
  4. By: Mario Genco; Emanuela Sirtori; Silvia Vignetti
    Abstract: This paper illustrates the story of the Port of Gioia Tauro, a major infrastructure investment co-financed by the European Regional Development Fund in the period 1994-1998, but whose origin dates back to the beginning of the 1970s. It draws from a recent ex-post evaluation carried out for the European Commission aimed at assessing the long term effects produced by a sample of ten major infrastructures in the Transport and Environment sectors and interpreting the key determinants of the observed performance. The analysis shows an emblematic story of great business success and unexploited potential for local development: the overall assessment of the economic impact of the project is mixed, stressing the multi-faceted dimensions of development plans. Although a significant effect in terms of job creation, the expected long term development effects, in particular in terms of industrial development in the surrounding area, did not materialise despite much effort (and money) being spent to that end. Wider effects of efficiency on the Italian and Mediterranean port system are additional benefits of the project, but they did not materialise at the local level and did not affect the living conditions of the local population. A key determinant of the past, present and even future performance of the port is the governance structure of the port and the broader area of Gioia Tauro (including in particular two industrial zones located close to the port area), which has been always characterised by fragmented actions and lack of coordination and clear political will. The number of actors, poor strategic direction, vested interests at national, regional and local level and, finally, conflicts between local public authorities are responsible for the current state of play and are the main difficulty to be resolved going forward. In addition, the weakness of the overall transport (and more specifically port) strategy at national level has exacerbated the existing governance problems. The paper discusses to what extent factors such as governance, managerial response and social acceptability can be key determinants of long term effects of a large infrastructure project, more than forecasting capacity or project technical design. It also offers a pilot case testing an innovative evaluation exercise combining cost-benefit analysis with qualitative assessment and adopting a long-run perspective (30 years), which extends into both the past and the future, and requires a mix of retrospective and prospective analysis.
    Keywords: Cost-benefit analysis; Infrastructures; Cohesion Policy; Regional Development
    JEL: D61 H54 R58 O12
    Date: 2013–11
  5. By: Inderst, Georg; Stewart, Fiona
    Abstract: The link between infrastructure and economic growth is widely acknowledged -- as is the infrastructure gap, which can act as a break on growth in emerging markets and developing economies (EMDEs). Since the global economic and financial crisis, the challenges of raising financing for infrastructure projects in EMDEs are also well known. The challenges come from stretched government finances and restrictions on global bank lending. Hence much attention has been focused on the potential for institutional investors as a growing potential source of financing. This paper argues that infrastructure projects can potentially deliver long-term returns, but investments, particularly in EMDEs need to be carefully structured to meet the needs of both sides. The paper first considers the existing types of institutional investors and their potential for filling the infrastructure financing gap. The challenges of adjusting asset allocations, particularly toward EMDE infrastructure, are discussed and examples of projects where institutional investors have been involved are given. Finally, the paper considers a range of models for the involvement of institutional investors in EMDEs and makes initial proposals for how to determine which model fits best in a particular country context.
    Keywords: Debt Markets,Emerging Markets,Non Bank Financial Institutions,Mutual Funds,Banks&Banking Reform
    Date: 2014–02–01
  6. By: Nadezhda Mikova (National Research University Higher School of Economics (Russia)); Anna Sokolova (National Research University Higher School of Economics (Russia))
    Abstract: Technology foresight is mainly conducted by applying a combination of qualitative and quantitative methods. An evidence-based approach implies covering a wide range of information sources, as well as the active application of quantitative methods for processing. Therefore, it is very important to select the right sources of data, extract core information from them, and interpret the results correctly. In theoretical works devoted to identifying technology trends, the most widely used information sources are scientific publications and patents. There are also authors who propose relying on additional sources of data (media, conferences, business-related resources, and others). However, the issue of applicability and comparison of core and extra sources of information for monitoring technology trends has not received sufficient coverage in the literature. In connection with this, the purpose of this paper is to conduct a comparative analysis of the results of technology monitoring by using various information sources (scientific publications, patents, media, foresight-projects, conferences, international projects, dissertations, and presentations). The proposed approach is tested on the area of green energy and the results are described and analyzed. Possible factors that can affect the results of data processing are considered and discussed in order to more efficiently use the comparative analysis of quantitative and qualitative procedures for identifying, correcting, and updating global technology trends on a regular basis.
    Keywords: technology foresight, technology trends monitoring, evidence-based studies, quantitative methods, information sources, data clustering, green energy
    JEL: O31 O32 O33 O38
    Date: 2014
  7. By: Klein, Michael; Kaur, Sumeet
    Abstract: Social impact investors, philanthropists, or corporations pursuing social responsibility try to demonstrate that they are indeed"doing good."This essay classifies the various types of measures that currently exist to capture social and environmental impact in a simple scheme. It argues that there is a basic"staircase of results measurement."A first level of measures captures some aspect of"organizational readiness."The next level describes some form of"result"that may or may not be attributable to the organization trying to do good. The third level gets at"impact"that can be attributed to an intervention. Beyond this, there are measures that assess the costs and benefits of interventions, allow aggregation of results from different interventions and comparison among them or across time. Finally, the essay discusses how measures are tied to incentives. It argues that the various approaches can produce more or less helpful measures but cannot be expected to yield anything approaching a true"double"or"triple"bottom line. A true"bottom line"involves aggregation and comparability of costs and benefits and provides incentives to perform. The multitude of social and environmental measurement schemes will by necessity remain a patchwork that can be thought of as describing the"product characteristics"of a company's output. Accounting profit remains the only measure that effectively aggregates costs and benefits and provides incentives. Profit itself is not just a necessity for organizational survival. It measures whether organizations meet client needs. It is thus an important measure of social impact in its own right. This may be unsurprising, but it sets expectations straight compared with currently widespread unrealistic hopes for the measurement of social and environmental impact and redirects attention to paying attention to profitability as part of impact measurement.
    Keywords: Environmental Economics&Policies,Economic Theory&Research,Labor Policies,Debt Markets,E-Business
    Date: 2014–02–01

This nep-ppm issue is ©2014 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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