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on Project, Program and Portfolio Management |
| By: | Carlo Alberto Magni |
| Abstract: | Literature and textbooks on capital budgeting endorse Net Present Value (NPV) and generally treat accounting rates of return as not being reliable tools. This paper shows that accounting numbers can be reconciled with NPV and fruitfully employed in real-life applications. Focusing on project finance transactions, an Average Return On Investment (AROI) is drawn from the pro forma financial statements, obtained as the ratio of aggregate income to aggregate book value. It is shown that such a metric correctly captures a project’s economic profitability, as long as it is compared with a comprehensive Weighted Average Cost of Capital that includes a correction factor which takes account of the capital foregone by the investors. Contrary to the Internal Rate of Return, AROI is unique and we provide an explicit functional relation which links it to the NPV. The approach holds for levered and unlevered projects, constant and non-constant leverage ratios, constant and non-constant WACCs. |
| Keywords: | Return On Investment, capital budgeting, lost capital, average, financial accounting, project finance |
| JEL: | M4 G31 |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:mod:wcefin:14109&r=ppm |
| By: | Torsten Ehlers |
| Abstract: | What is holding back infrastructure investment, even though real long-term interest rates are low and the potential supply of long-term finance is ample? The answer matters to policy makers, because infrastructure is a key determinant of the growth potential of an economy. This paper identifies some key obstacles for better and greater infrastructure finance and investment. One such obstacle is the lack of investable projects. Often, projects are not properly designed and contractual arrangements imply a distribution of risks and returns that create the wrong incentives among the various partners. The greater involvement of private investors and the design of economically rational financing structures can mitigate such problems. They also improve the efficiency and success of infrastructure projects. A pipeline of investable projects would allow large investors to commit a greater share of their financial resources to infrastructure. Tapping the vast resources of capital markets, which thus far have been underutilised, could significantly boost infrastructure finance. A greater variety of financial instruments for infrastructure finance would help to make infrastructure more attractive for a broader group of investors and would allow a better diversification of risks. |
| Keywords: | infrastructure finance, G20 initiatives, syndicated project loans, infrastructure bonds |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:454&r=ppm |
| By: | Eoin Reeves; Donal Palcic; Darragh Flannery (Department of Economics, University of Limerick) |
| Abstract: | The relative complexity of procurement under PPP means that tendering periods can be longer compared to traditional procurement models. Reducing the tendering period is therefore an important challenge if Public-Private Partnership (PPP) is to deliver infrastructure on time and within budget. Using data from 59 PPP projects in Ireland we find that the average tendering period has been 33.3 months. Regression analysis shows that tendering periods have fallen over time and are positively but not strongly associated with the capital value of projects. Tendering periods are longer for projects that do not involve private finance with the majority of such projects procured by local authorities. We use a case study of PPP procurement by a local authority to explore these issues further. The ‘Dublin Waste to Energy’ PPP shows the complex array of factors that can impact on tendering periods some of which are outside the control of the procurement authority. |
| Keywords: | Public-private partnerships, procurement, tendering periods, Ireland, Incinerator |
| Date: | 2013–06 |
| URL: | http://d.repec.org/n?u=RePEc:lim:wpaper:012013&r=ppm |
| By: | Jesus Gonzalez-Feliu (LET - Laboratoire d'économie des transports - CNRS : UMR5593 - École Nationale des Travaux Publics de l'État [ENTPE] - Université Lumière - Lyon II); Bruno Faivre D'Arcier (LET - Laboratoire d'économie des transports - CNRS : UMR5593 - École Nationale des Travaux Publics de l'État [ENTPE] - Université Lumière - Lyon II); Josep-Maria Salanova Grau (Hellenic Institute or Transport - Center of Research and Technologie Hellas); Tiphaine Hervé (Interface Transport - Interface Transport); Fernando Zubillaga (Mobility and Logistics Cluster Euskadi - Cluster Movilidad y logística Euskadi); Zeljko Jeftic (Ertico - Ertico ITS); Jean-Baptiste Thebaud (Interface Transport - Interface Transport); Georgia Aifandopoulou (Hellenic Institute or Transport - Center of Research and Technologie Hellas) |
| Abstract: | The deployment of urban logistics solutions is one of the main pending questions in the field of urban goods transport research and practice. Indeed, although several solutions and projects have been tested in the last years, only few of them reach an operational phase and remain viable in time. Through the example of a recently finished demonstration project, this paper presents the main issues related to the deployment of urban logistics solutions form research and development results. More precisely, this paper aims to focus on how the conclusions of pilot actions can be used to forecast the possibilities of deployment for an urban logistics service. First, we present the main stages in deploying a technological or organizational solution, based on the FREILOT project's deployment research and analysis. Then, one of the analysed technologies in the project is presented: the delivery space booking service. After presenting the main business model elements, an example of cost-benefit analysis is proposed, defining the method and the main hypotheses, as well as the main conclusions from the analysis. Then, the main barriers to the deployment of delivery space boking devices are presented. Finally, the paper shows a set of guidelines for public authorities and transport practitioners to deploy urban logistics solutions. |
| Keywords: | urban logistics services; deployment; cost-benefit analysis; barriers; business model |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00784075&r=ppm |
| By: | Myriam Merad (INERIS - Institut National de l'Environnement Industriel et des Risques - INERIS); Nicolas Dechy (INERIS - Institut National de l'Environnement Industriel et des Risques - INERIS); Lisa Serir (FEMTO-ST - Franche-Comté Électronique Mécanique, Thermique et Optique - Sciences et Technologies - CNRS : UMR6174 - Université de Franche-Comté - Université de Technologie de Belfort-Montbeliard - Ecole Nationale Supérieure de Mécanique et des Microtechniques); Michel Grabisch (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Frédéric Marcel (INERIS - Institut National de l'Environnement Industriel et des Risques - INERIS) |
| Abstract: | The implementation of Sustainable Development (SD) within an Organization is a difficult task. This is due to the fact that it is difficult to deal with conflicting and incommensurable aspects such as environmental, economic and social dimensions. In this paper we have used a Multi-Criteria Decision Aid (MCDA) methodology to cope with these difficulties. MCDA methodology offers the opportunity to avoid monetary valuation of the different dimensions of the SD. These dimensions are not substitutable for one another and all have a role to play. There is an abundance of possible aggregation procedures in MCDA methodology. In this paper we have proposed an innovative method to choose a suitable aggregation procedure for SD problems. Real life case studies of the implementation of an outranking approach (i.e., ELECTRE) and of a mono-criterion synthesis approach (i.e., MAUT approaches based on the Choquet integral) were done to respectively rank 22 SD strategic actions within an expertise Institute and rank 20 practical operational actions to control energy consumption of the Institute's buildings. |
| Keywords: | Sustainable Development indicators; Sustainable Development action plan; Multi-Criteria Decision Aid; ELECTRE; Choquet Integral |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00752736&r=ppm |
| By: | World Bank |
| Keywords: | Health Monitoring and Evaluation Public Sector Expenditure Policy Finance and Financial Sector Development - Bankruptcy and Resolution of Financial Distress Finance and Financial Sector Development - Debt Markets Banks and Banking Reform Public Sector Development Health, Nutrition and Population |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:20052&r=ppm |
| By: | Randall W. Jackson (Regional Research Institute, West Virginia University) |
| Abstract: | This document is intended to clarify the foundations of the IO and CGE analytical frameworks and procedures that underlie the NSF and USDA/NIFA funded research projects. It covers environmental data, life cycle assessment (LCA), input-output models (IO), structural decomposition analysis (SDA), social accounting matrix models (SAMs), and computable general equilibrium modeling (CGE). |
| Keywords: | LCA, IO, SDA, SAMs, CGE |
| JEL: | C67 C68 D58 R13 R15 |
| Date: | 2013–08–09 |
| URL: | http://d.repec.org/n?u=RePEc:rri:wpaper:2013rd01&r=ppm |