nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2015‒08‒13
ten papers chosen by
Arvi Kuura
Tartu Ülikool

  1. Project finance in Hungarian electricity sector. Effect of feed-in tariff system’s change onto power plant investments By Madácsi, Roland
  2. A Back-up Quarterback View of Mezzanine Finance By Antonio Mello; Erwan Quintin
  3. Office of Anticorruption and Integrity: 2014 Annual Report By Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB); Asian Development Bank (ADB)
  4. Economic Impact of the New England Aqua Ventus (Phases I and II) Offshore Wind Power Program in Maine By Gabe, Todd
  5. The experience of Italy and the US with exceptional regulatory incentives for exceptional electricity transmission investments By Nico Keyaerts; Leonardo Meeus
  6. Clusters and Collective Learning Networks: The Case of the Competitiveness Cluster 'Secure Communicating Solutions' in the French Provence-Alpes-Côte d'Azur Region By Christian Longhi
  7. Trees Plus: Weyerhaeuser Ecosystem Services Reporting Project By Phillips, Cassie
  8. Crowdfunding, demand uncertainty, and moral hazard - a mechanism design approach By Roland Strausz; ; ;
  9. San Diego I-15 Demonstration Integrated Corridor Management System: PATH Report on Stage 3: Site Demonstration and Evaluation By Dion, Francois; Skabardonis, Alexander
  10. Are “Better” Ideas More Likely to Succeed? An Empirical Analysis of Startup Evaluation By Erin L. Scott; Pian Shu; Roman M. Lubynsky

  1. By: Madácsi, Roland
    Abstract: The research analyses the former and the current status of the small gas-motor power plant investments in the Hungarian energy sector. It discusses the development of project financing in the segment and the major changes and effects of new regulations and subsidy-policy implemented in 2010. The objective of this paper is to present the results of an empirical research of the so called GCHP projects, and to draw conclusion concerning how classic project financing conditions were present and changed during the last decade, and how regulation affected the current and future financial status of these projects.
    Keywords: project financing, corporate financing, energy sector
    JEL: G32 G38 L94
    Date: 2015–06–01
  2. By: Antonio Mello (University of Wisconsin - Madison); Erwan Quintin (University of Wisconsin at Madison)
    Abstract: Abstract Mezzanine finance is ubiquitous. Traditional arguments describe the purpose of Mezzanine debt as completing the market, specifically as ``plugging'' a financing gap. According to that view, intermediate seniority claims add to the available menu of risk-return combinations hence helps cater to the needs of heterogeneous investors and generates additional sources of capital for productive investment projects. We describe a completely different yet equally fundamental role for Mezzanine debt which creates economic value even in a world where all investors are homogenous and risk-neutral. According to our theory, Mezzanine financiers serve as substitute managing agents -- ``back-up quarterbacks'' of sorts -- ready to replace the original borrower when the project underperforms. They enable senior borrowers to provide incentives to the original agent without resorting to inefficient punishment such as foreclosing on the project even when its NPV as a going-concern remains positive. The fact that Mezzanine lenders tend to be industry-specialists while senior borrowers tend to be traditional intermediaries, we argue, constitutes direct evidence that Mezzanine stakeholders provide the expertise senior lending need to efficiently mitigate agency frictions.
    Date: 2015
  3. By: Asian Development Bank (ADB); Asian Development Bank (ADB) (Office of Anticorruption and Integrity, ADB); Asian Development Bank (ADB) (Office of Anticorruption and Integrity, ADB); Asian Development Bank (ADB)
    Abstract: The Office of Anticorruption and Integrity (OAI) helps ensure that development funds entrusted to the Asian Development Bank (ADB) are not misused through fraud or corruption. This publication highlights OAI’s 2014 activities such as providing integrity due diligence support, investigating allegations of integrity violations, and proactively reviewing projects. OAI also delivered integrity-focused training and support for staff, civil society, and project officials in line with ADB’s goal to improve project efficiency through strengthening country systems and control.
    Keywords: adb, asian development bank, asdb, asia, pacific, poverty asia, anticorruption, integrity, oai investigations, adb operations, sanctions, fraud, corruption, paris declaration, transparency, ethical standards, violations, anticorruption, asian development bank, integrity due diligence, advisory support, risk mitigation
    Date: 2015–03
  4. By: Gabe, Todd
    Abstract: The purpose of this study is to examine the statewide economic impacts of the New England Aqua Ventus offshore wind power program in Maine. Phase I of this program involves the planning and construction, and ongoing operations of a 12 MW pilot project; and Phase II of Aqua Ventus involves a 500 MW offshore wind power installation along with the production of VolturnUS floating platforms and towers that could be used in other offshore wind projects.
    Keywords: Off-shore Wind Power, Economic Impact, Maine
    JEL: L94 Q42 R15
    Date: 2013–09
  5. By: Nico Keyaerts; Leonardo Meeus
    Abstract: There is a trend in regulatory practice towards exceptional incentives for exceptional investments. Italy and the US have the longest experience with a regulatory framework for strategically important investments that deviates from the default framework. In these countries, the incentives provided to the project promoter are based on a case-by-case assessment of the project. Policy makers and regulatory authorities in countries that are considering setting up such a framework can learn from these experiences. In this paper, we therefore analyze them in detail. We find that the Italian scheme is simpler, which reduces the administration costs. The US scheme is more advanced in the case-by-case assessment of the requested incentives. However, both schemes have evolved, each becoming more sophisticated and complex. Countries that are considering the introduction of exceptional regulatory incentives for exceptional electricity transmission investments should note that this is a process that will require fine-tuning).
    Keywords: Electricity Transmission, Transmission grid, Interconnection, Incentive Regulation
    Date: 2015–06
  6. By: Christian Longhi (Université Nice Sophia Antipolis; GREDEG-CNRS)
    Abstract: Since the development of the knowledge based economies, clusters and clusters policies have been the subject of increased interest, as sources of knowledge, innovation, and competitiveness. The paper focuses on a case study drawn from the French cluster policy, the pole of competitiveness 'Secure Communicating Solutions' in the French Provence-Alpes-Côte d'Azur Region, based on two high tech clusters, Rousset - Gémenos and Sophia-Antipolis. The policy aims to provide the firms incentives to build network relations of heterogeneous actors to trigger innovative processes. The analysis of the collaborative R&D projects of the pole provides insights on the nature of the collective learning networks working in the clusters as well as the prevailing organizational forms resulting from the firms strategies. It show that knowledge spillovers are not simply "in the air" but very specific of the learning networks and clusters from which they belong. Clusters thus need to be analyzed jointly with networks in order to understand the processes underlying their innovation capacity.
    Keywords: Collective Learning Networks, Knowledge, Innovation, Clusters, Cluster Policy, Social Network Analysis
    JEL: L14 L38 O31 R11
    Date: 2015–08
  7. By: Phillips, Cassie
    Keywords: Environmental Economics and Policy, Land Economics/Use,
    Date: 2014–02–20
  8. By: Roland Strausz; ; ;
    Abstract: Crowdfunding challenges the traditional separation between nance and marketing. It creates economic value by reducing demand uncertainty, which enables a better screening of positive NPV projects. Entrepreneurial moral hazard threatens this eect. Using mechanism design, mechanisms are characterized that induce ecient screening, while preventing moral hazard. \All-ornothing" reward-crowdfunding platforms re ect salient features of these mechanisms. Eciency is sustainable only if expected gross returns exceed twice expected investment costs. Constrained ecient mechanisms exhibit underinvestment. With limited consumer reach, crowdfunders become actual investors. Crowdfunding complements rather than substitutes traditional entrepreneurial nancing, because each nancing mode displays a dierent strength.
    Keywords: Crowdfunding, nance, marketing, demand uncertainty, moral hazard
    JEL: D82 G32 L11 M31
    Date: 2015–07
  9. By: Dion, Francois; Skabardonis, Alexander
    Abstract: This report describes activities surrounding the design, building, deployment, operation, and evaluation of an innovative corridor management (ICM) system aiming to improve mobility within the Interstate 15 (I-15) corridor in San Diego, California, by integrating the operations of the I-15 freeway with the surrounding arterials and transit systems. Systems engineering principles were applied to support the development of the demonstration ICM system and the systems engineering process was credited by the project team with having contributed significantly to the success of the project. While full system evaluations were not yet available when this report was written, the deployed I-15 ICM system had already demonstrated its ability to identify incidents and unusual congestion events, to develop traffic management strategies integrating freeway, arterial, and transit operational elements, and to implement recommended strategies either automatically or following approval by relevant system operators. The system has also demonstrated the feasibility of using a microscopic traffic simulation model in a real-time operational environment to forecast corridor operations under alternative scenarios. Simulation evaluations have further consistently shown operational benefits exceeding deployment costs.
    Keywords: Engineering, Integrated corridor management, ICM, Traffic simulation, Microsimulation, Traffic incidents, Traffic congestion, Traffic management, Arterial highways
    Date: 2015–06–30
  10. By: Erin L. Scott (National University of Singapore Business School); Pian Shu (Harvard Business School, Technology and Operations Management Unit); Roman M. Lubynsky (Massachusetts Institute of Technology)
    Abstract: Entrepreneurs face high uncertainty, and often make costly investments in new business ideas without knowing the expected payoff. This paper empirically examines whether ex-ante assessment of early-stage startup ideas can predict their subsequent commercialization. We leverage an entrepreneurship program at the Massachusetts Institute of Technology in which early-stage venture ideas, presented in the form of succinct standardized summaries, elicit subjective evaluations from a large set of experienced entrepreneurs and executives. Using data on 652 ventures in multiple industry sectors, evaluated over an 8-year period, we find that ideas that elicit more positive evaluations are significantly more likely to ultimately reach commercialization. We further show that these results are driven by venture ideas with documented intellectual capital in research-and-development-intensive sectors, such as life sciences and medical devices. We find no evidence, by contrast, that experts can effectively assess the commercial potential of venture ideas in non-R&D-intensive sectors such as consumer web and enterprise software. Finally, we find that industry-specific and scientific expertise is not critical to experts' collective ability to predict ventures' commercial viability.
    JEL: L26 M13 O31 J24 G32
    Date: 2015–07

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