nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2016‒11‒20
six papers chosen by
Arvi Kuura
Tartu Ülikool

  1. Carbon taxation and market financial instruments for mobilizing climate finance By Oleksandr Sushchenko; Reimund Schwarze
  2. Properties of the financial break-even point in a simple investment project as a function of the discount rate By Domingo A. Tarzia
  3. Collective Choice in Dynamic Public Good Provision By Bowen, T. Renee; Georgiadis, George; Lambert, Nicolas
  4. Flip a coin or vote : an Experiment on choosing group decision By Hoffmann, Timo; Renes, Sander
  5. Innovation Policy: What, Why & How By Jakob Edler; Jan Fagerberg
  6. Improving access to finance: which schemes best support the emergence of high-growth innovative enterprises? A mapping, analysis and assessment of finance instruments in selected EU Member States By Robert Gampfer; Jessica Mitchell; Blagoy Stamenow; Jana Zifciakova; Koen Jonkers

  1. By: Oleksandr Sushchenko (Kyiv National Economic University named after V. Hetman, 03680, Kyiv, Ukraine); Reimund Schwarze (Europa University Viadrina and Helmholtz Centre for Environmental Research (UFZ))
    Abstract: The aim of this paper is to conduct an evaluation of the financial instruments and their role in mobilizing climate finance, provide a set of recommendations aimed at easing the process of climate finance mobilization for both developed and developing countries (especially, for Ukraine). It is also important to show the shift from voluntary corporate social responsibility (CSR) to the new principles of investing (ESG) and business models in the climate change area and how it affects mobilization of climate finance. Another important goal of this paper is to show the importance of transaction costs, and ways how the accounting, reporting and evaluation of the results of emission reduction projects could reduce existing costs and improve access to the financial market, i.e. to the relatively “cheap” financial resources. We also highlights ways for establishing the necessary infrastructure on the financial market needed to minimize the transaction costs while getting financial resources for the purpose of greenhouse gases reduction (GHG reduction).
    Keywords: climate finance, carbon taxation, market financial instruments, climate- aligned bonds, non-financial reporting
    JEL: G15 Q58
    Date: 2016–10
  2. By: Domingo A. Tarzia
    Abstract: We consider a simple investment project with the following parameters: I>0: Initial investment which is amortizable in n years; n: Number of years the investment allows production with constant output per year; A>0: Annual amortization (A=I/n); Q>0: Quantity of products sold per year; Cv>0: Variable cost per unit; p>0: Price of the product with p>Cv; Cf>0: Annual fixed costs; te: Tax of earnings; r: Annual discount rate. We also assume inflation is negligible. We derive a closed expression of the financial break-even point Qf (i.e. the value of Q for which the net present value (NPV) is zero) as a function of the parameters I, n, Cv, Cf, te, r, p. We study the behavior of Qf as a function of the discount rate r and we prove that: (i) For r negligible Qf equals the accounting break-even point Qc (i.e. the earnings before taxes (EBT) is null) ; (ii) When r is large the graph of the function Qf=Qf(r) has an asymptotic straight line with positive slope. Moreover, Qf(r) is an strictly increasing and convex function of the variable r; (iii) From a sensitivity analysis we conclude that, while the influence of p and Cv on Qf is strong, the influence of Cf on Qf is weak.
    Date: 2016–06
  3. By: Bowen, T. Renee; Georgiadis, George; Lambert, Nicolas
    Abstract: Two heterogeneous agents contribute over time to a joint project, and collectively decide its scope. A larger scope requires greater cumulative effort and delivers higher benefits upon completion. We show that the efficient agent prefers a smaller scope, and preferences are time-inconsistent: as the project progresses, the efficient (inefficient) agent's preferred scope shrinks (expands). We characterize the equilibrium outcomes under dictatorship and unanimity, with and without commitment. We find that an agent's degree of efficiency is a key determinant of control over project scopes. From a welfare perspective, it may be desirable to allocate decision rights to the inefficient agent.
    Keywords: authority; collective choice; contribution games; free-riding; Public Goods
    JEL: C73 D70 D78 H41
    Date: 2016–11
  4. By: Hoffmann, Timo; Renes, Sander
    Abstract: Before a group can take a decision, its members must agree on a mechanism to aggregate individual preferences. In this paper we present the results of an experiment on the influence of private payoff information and the role of the available alternatives on individuals’ mechanism choices in such group choice situations. While efficient mechanisms are desirable, we experimentally show that participation constraints can prevent their implementation. We find strong indications that individual preferences for choice rules are sensitive to individual expected payoffs. Our results highlight the importance of considering participation constraints when designing choice institutions.
    JEL: C91 C92 D70 D82
    Date: 2016
  5. By: Jakob Edler (Manchester Institute of Innovation Research, MBS, University of Manchester, UK); Jan Fagerberg (Centre for Technology, Innovation and Culture (TIK), University of Oslo, Norway)
    Abstract: During the last two-three decades policy-makers have increasingly became concerned about the role of innovation for economic performance and, more recently, for the solution of challenges that arise (such as the climate challenge). The view that policy may have a role in supporting for innovation has become widespread, and the term innovation policy has become commonly used. This paper takes stock of this rapidly growing area of public policy, with particular focus on the definition of innovation policy (what it is); theoretical rationales (why innovation policy is needed); and how innovation policy is designed, implemented and governed.
    Date: 2016–11
  6. By: Robert Gampfer (European Commission - JRC); Jessica Mitchell (European Commission - JRC); Blagoy Stamenow (European Commission - JRC); Jana Zifciakova (European Commission - JRC); Koen Jonkers (European Commission - JRC)
    Abstract: This Science for Policy Report describes national support instruments to improve access to finance for high-growth innovative enterprises and analyses available evidence for their effectiveness and economic impact on beneficiary companies. The analysis covers Germany, Finland, Lithuania, Poland and the United Kingdom.
    Keywords: SME, access to finance, financial instruments, policy evaluation, Germany, Poland, United Kingdom, Lithuania, Finland, venture capital, fund-of-funds, guarantee schemes
    Date: 2016–11

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