nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2016‒04‒30
nine papers chosen by
Arvi Kuura
Tartu Ülikool

  1. Environmental Regulation and Choice of Innovation in Oligopoly By Iwata, Hiroki
  2. The Impact of Participatory Projects on Social Capital: Evidence from Farmland Consolidation Projects in Japan By Takayama, Taisuke; Nakatani, Tomoaki
  3. Investing in disaster risk management in an uncertain climate By McDermott,Thomas K.J.
  4. Bridging the Industrial Energy Efficiency Gap: Assessing the Evidence from the Italian White Certificate Scheme By Jan Stede
  5. Water-Storage Capacities versus Water-Use Efficiency: Substitutes or Complements? By Xie, Yang; Zilberman, David
  6. Decentralization of Social Assistance Programs and the Poverty Reducing Impacts of Earnings Potential Equivalence Scales By Simons, Andrew M.
  7. Planting the seeds: The impact of training on mando producers in Haiti By Arraiz, Irani; Calero, Carla; Jon, Songqing; Peralta, Alexandra
  8. Task ordering in incentives under externalities By Agastya, Murali; Bag, Parimal Kanti; Pepito, Nona

  1. By: Iwata, Hiroki
    Abstract: This study investigates the effect of an environmental regulation on the innovation choice of firms in an oligopoly. Most existing studies on environmental regulations and innovations examine the optimal behavior of firms when one innovation project is feasible. In our model, firms are allowed to choose from multiple types of innovation projects. Our main contributions are that we derive the conditions under which environmentally friendly and cost reducing innovations are selected in Bertrand competition and we show how environmental regulation affects innovation choice.
    Keywords: environmental regulation; innovation; the Porter hypothesis
    JEL: D21 Q55 Q58
    Date: 2016–03–25
  2. By: Takayama, Taisuke; Nakatani, Tomoaki
    Abstract: Farmland fragmentation can lead to low agricultural productivity. In Japan, one solution is Farmland Consolidation Projects (FCPs), participatory public projects that physically merge and reshape several small plots into one large plot. This paper examines the impact of FCPs on community-level social capital by using propensity score matching. We find that FCPs have a positive impact on agriculture-related bonding social capital and a negative impact on non-agriculture-related bridging social capital. Focusing on the constituent elements of bonding social capital, FCPs have a positive effect on the number of community meetings held, non-agriculture-related organizations for women, and management of common-pool resources. On the other hand, focusing on the constituent elements of bridging social capital, FCPs have a negative effect on holding direct sales of agricultural products and rural experience programs for city residents.
    Keywords: Farmland Consolidation Projects, Participatory Projects, Social Capital, Impact Evaluation, Japan, Agribusiness, Farm Management, International Development, O13, Q15,
    Date: 2015
  3. By: McDermott,Thomas K.J.
    Abstract: Climate change will exacerbate the challenges associated with environmental conditions, especially weather variability and extremes, in developing countries. These challenges play important, if as yet poorly understood roles in the development prospects of affected regions. As such, climate change reinforces the development case for investment in disaster risk management. Uncertainty about how climate change will affect particular locations makes optimal investment planning more difficult. In particular, the inability to derive meaningful probabilities from climate models limits the usefulness of standard project evaluation techniques, such as cost-benefit analysis. Although the deep uncertainty associated with climate change complicates disaster risk management investment decisions, the analysis presented here shows that these considerations are only relevant for a relatively limited set of investment circumstances. The paper offers a simple decision framework that enables policy makers to identify the particular circumstances under which uncertainty about future climate change becomes critical for disaster risk management investment decisions. Accounting for climate uncertainty is likely to shift the optimal balance of disaster risk management strategies toward more flexible, low-regret type interventions, especially those that seek to promote"development first"or"risk-coping"objectives. Such investments are likely to confer additional development dividends, regardless of the climate future that materializes in a given location. Importantly, the analysis here also demonstrates that climate uncertainty does not necessarily motivate a"wait and see"approach. Instead, where opportunities exist to avail of adaptation co-benefits, climate uncertainty provides additional motivation for early investment in disaster risk management initiatives.
    Keywords: Adaptation to Climate Change,Climate Change Economics,Science of Climate Change,Economic Theory&Research,Climate Change Mitigation and Green House Gases
    Date: 2016–04–12
  4. By: Jan Stede
    Abstract: The Italian white certificate scheme is the main national policy instrument to incentivise energy efficiency of the industrial sector. The mechanism sets binding energy-saving targets on electricity and gas distributors with at least 50,000 clients and includes a voluntary opt-in model for participation from other parties. This paper investigates and assesses the elements of the scheme that help overcome several barriers to deliver industrial energy efficiency. Results from a survey conducted among leading experts indicate that the Italian system provides a strong financial incentive to energy efficiency investments, covering a significant share of investment costs and thus reducing payback time. Moreover, the scheme fosters the development of energy service companies (ESCOs), which are key to developing, installing and arranging finance for projects on the ground. In conjunction with other policies, the mechanism also raises awareness of energy efficiency investment opportunities, thus helping overcome the market failure of insufficient information. Core challenges remain, including tackling regulatory uncertainty and improving access to finance.
    Keywords: White certificates, energy efficiency obligations, financial incentives, policy evaluation, ESCOs, industrial energy savings, market barriers
    JEL: D22 D82 L14 L97 Q48
    Date: 2016
  5. By: Xie, Yang; Zilberman, David
    Abstract: We investigate the economic relation between two common approaches to tackling water scarcity and adapting to climate change, namely expanding water-storage capacities and improving water-use efficiency. We build, analyze, and extend a simple model for capacity choices of dams, incorporating stochastically dynamic control of water inventories and efficiency in water use. We show that expanding water-storage capacities could encourage water users to improve water-use efficiency and improving water-use efficiency could increase optimal dam sizes even if water-use efficiency improvement decreases the water demand. The possibility of complementarity is numerically illustrated by an empirical example of the California State Water Project. Our analysis implies that, if complementarity holds, resources should be distributed in a balanced way between water-storage expansions and water-use efficiency improvement instead of being concentrated on one side with the other side being ignored.
    Keywords: Environmental Economics and Policy, Land Economics/Use,
    Date: 2015
  6. By: Simons, Andrew M.
    Abstract: Who receives aid and how much he or she receives are questions of central importance for any well-functioning social protection program. We investigate community-based processes for allocating aid within Ethiopia’s Productive Safety Net Program. We document local governments’ aid via the federally mandated uniform per capita payment schedule, communities distribute aid based on locally determined equivalence scales. Rather than equalizing consumption, it appears that local communities allocate aid based on an earnings potential equivalence scale by assigning higher payments to cohorts that have lower wage earnings potential (e.g., teenage girls vs. teenage boys, adult women vs. adult men, elderly vs. working age adults). The decentralized implementation approach reduces head count poverty more than if communities followed central implementation mandates. However, poverty gap and poverty gap squared measures would be lower under central implementation mandates. The choice of distribution rules at the intensive margin does not materially affect poverty measures, suggesting that targeting efforts might be best focused on eligibility at the extensive margin.
    Keywords: decentralization, equivalence scales, social protection, targeting, safety nets, Consumer/Household Economics, Food Security and Poverty,
    Date: 2015
  7. By: Arraiz, Irani; Calero, Carla; Jon, Songqing; Peralta, Alexandra
    Abstract: This paper evaluates the short-term impacts of a development project that aims to increase mango yields, sales of mango products, and the income of small mango farmers in rural Haiti. Various matching methods, in combination with difference-indifference (DID), are used to deal with the potential selection bias associated with nonrandom treatment assignment. Our results show that in a 16-month period, the project increased the number of young mango trees planted and encouraged the adoption of best practices. But the project has not yet led to a noticeable increase in total sales. The adoption of improved production practices is too recent to translate into significant changes in production and sales. While the robustness check suggests that the results are not caused by the presence of other similar programs on the same sites, the Rosenbaum bounds sensitivity analysis suggests that the matching results are robust against “hidden bias” arising from unobserved outcome variables in some but not all cases.
    Keywords: Crop Production/Industries, Farm Management,
    Date: 2015
  8. By: Agastya, Murali (University of Sydney, 1School of Economics); Bag, Parimal Kanti (National University of Singapore, Faculty of Arts and Social Sciences, Department of Economics); Pepito, Nona (Essec Business School)
    Abstract: In a two-task team project with observable task outcomes, optimal incentives prioritize tasks differently depending on task externalities. When the tasks are independent, Principal follows a decreasing order by placing more essential task first. A task is more essential if its failure compromises the overall project's chance of success from a task-specific cutoff level by a greater percentage. This definition has no systematic relations to the variance of task outcomes. In particular, a more risky task can be less essential or more essential. Under externalities, essentiality and impact jointly determine the optimal ordering. A task with much higher impact can be performed early even if it is less essential. Optimal task ordering thus raises subtle new issues and forms an integral part in team incentives. Our analysis provides some contrast with recent team incentives results.
    Keywords: externalities in teams; sequencing; essential tasks; joint projects; team incentives
    JEL: D20 D80
    Date: 2016–01–25
  9. By: Morawetz, Ulrich; Sinabell, Franz
    Abstract: Targeting is a central part of many public support schemes to increase cost-effectiveness of policy intervention. Interestingly, targeting in the Rural Development Programs (RDP) of the EU has so far not been quantitatively evaluated for investment support schemes. In this article we suggest how the effectiveness of targeting in the investment support schemes can be evaluated with routinely available data. For an Austrian case-study we find that targeting of investment support measures could be substantially increased if eligibility criteria were used more extensively, as maximum aid-intensity differentiation turns out not to be effective and selection through ranking is not selective if the budget constraint is not binding.
    Keywords: Targeting-effectiveness, Rural Development Programs, Evaluation, Agricultural and Food Policy,
    Date: 2015

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