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on Project, Program and Portfolio Management |
| By: | Qi Zhang |
| Abstract: | Open competitive bidding with the contract awarded to the bidder offering the lowest bid price is commonly the recommended method for public procurement. However, the benefits of this form of bidding are subject to certain conditions, such as a good number of available bidders and no post-contract adaptations. This paper quantitatively evaluates the implications of the extent to which these conditions are satisfied for contract performance. It combines the performance ratings of World Bank financed projects with the information on bidding for World Bank procurement contracts and uses natural resources as exogenous variations to show that in resource-rich countries, where the conditions are less likely to be satisfied, awarding the contract to the bidder with the lowest bid price may not be the best procurement method in terms of contract performance. This is consistent with the evidence that World Bank financed projects performed better in non-resource-rich countries than in resource-rich countries over the last 40 years. This may explain why since 2016 the World Bank has shifted the focus of bid evaluation from the lowest bid to bids that provide the best overall value for money, taking into account risk, quality, cost and other factors as needed. |
| Keywords: | procurement, auction, World Bank, project evaluation |
| JEL: | D4 Q3 H4 H5 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:oxcrwp:184&r=ppm |
| By: | Raymond Deneckere (University of Wisconsin-Madison [Madison]); André De Palma (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Luc Leruth (University of Liege, IMF Office in Europe - EUO) |
| Abstract: | We introduce risk aversion in a mixed moral hazard/adverse selection model. Under plausible assumptions, the effort level of the firm is distorted downward from the first best level of effort for both agent types. Thus, the traditional result of no distortion on the top does not hold with risk aversion. We also show that the effort level of the low-cost type may be distorted more than that of the high cost type. With an observable cost shock, an increase in exogenous risk may increase the effort level of the efficient firm and lower the expected cost of the project. |
| Keywords: | Incentives,Contract Theory,Risk-Sharing., Regulation |
| Date: | 2016–11–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:hal-01393213&r=ppm |
| By: | R Khraibani (Université de Cergy Pontoise); A De Palma (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); N Picard (Université de Cergy Pontoise); I Kaysi (American University of Beirut [Beyrouth]) |
| Abstract: | The Transportation Elimination-by-Aspects (TEBA) framework, a new evaluation and decision making framework (and methodology) for large transportation projects, is proposed to elicit, structure and quantify the preferences of stakeholder groups across project alternatives. The decision rule used for group decision making within TEBA is the individual non-compensatory model of choice elimination by aspects (EBA). TEBA is designed to bring out the decision rule employed by decision makers when ranking the options presented, incorporate various criteria types and ease communication of relevant information related to options and criteria for multiple stakeholder groups. It is a platform for democratizing the decision making process. The TEBA framework was tested using a case study investigating alternative land connections between Beirut and Damascus. Key results showed that (1) stakeholders have employed EBA in making decisions, (2) a defined group of decision makers will rank options differently when provided with modified sets of criteria, (3) the public sector and general public groups ranked Impact on Employment among the top criteria, (4) the most important criterion per group from EBA was as expected; (5) the EBA analysis suggested that only 3 to 4 criteria are significant in reaching a decision; (6) aggregation of user assigned weights masked relative importance of criteria in some cases; and (7) analysis of user assigned weights and Minimum Threshold (MT) values suggest higher risk perception with increased criterion importance. Policy implications include recommendation to reach out to stakeholders for input on decisions, including the " people " but refrain from relying on criteria weights assigned by " experts " and reduce the " experts " ' role in decision making. Also, it is recommended to model the decision making in a probabilistic framework rather than a deterministic " one score " approach, seek to identify a consensus ranking, place particular attention on determining the values of the criteria that emerged as " top " at the evaluation stage and continue to emphasize risk measures. |
| Keywords: | Cost Benefit Analysis,Behavioral Choice ,Elimination by Aspects,Consensus Model / Joint Decision Making,Index of Dispersion,Transportation Investment,Collective Decision Making |
| Date: | 2016–03–21 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:hal-01291343&r=ppm |
| By: | Allan Dahl Andersen (TIK Center for Technology, Innovation and Culture, University of Oslo, Norway); Jochen Markard (Swiss Federal Institute of Technology Zurich (ETH Zurich), Switzerland) |
| Abstract: | It is a classic theme in the transitions literature that newcomers supporting a novel technology struggle for dominance against incumbent actors and ‘their’ established technologies. Our study challenges this picture in several aspects with the intention to improve conceptual frameworks in transition studies. We present a case study on high voltage direct current (HVDC) technology - a mature technology for electricity transmission that has remained in a niche for decades but recently gained new momentum in the course of the energy transition. This case highlights i) incumbent actors as key drivers for innovation, ii) coupled dynamics via interaction of multiple technologies, also across industry boundaries, as a central process in transition dynamics, and iii) the increasingly pervasive nature of the energy transition. We interpret our observations from the perspective of two established frameworks, technological innovation systems and the multi-level perspective, and discuss implications for conceptual refinement. |
| Date: | 2017–06 |
| URL: | http://d.repec.org/n?u=RePEc:tik:inowpp:20170612&r=ppm |
| By: | Relativo, Jona Princess; Sumayang, Mildred; Diasana, Sarah Jean; Murcia, John Vianne |
| Abstract: | This paper examined the capital investment decisions of micro, small and medium enterprises, with the aim of assessing its current levels and its conditions across industries in Digos City. Questionnaires measuring the four phases of capital investment decisions were administered to a stratified random sample of 125 owners or managers of micro, small and medium enterprises while further in-depth interviews were done to extract explanatory factors of capital investment decisions that were not accounted in the quantitative phase. Non-parametric test of association revealed no significant association of capital investment decisions and nature of industry being engaged by MSME owners/managers. Pearson r correlation test revealed that generation of investment opportunities, project analysis and approval, and post-implementation audit have significant relationship with years of operation. Further qualitative analysis of interviews revealed that the influential factors affecting financing decisions of MSME’s owners include sources of finances, entrepreneurs’ prior experiences, business trends, and diversification of investments. |
| Keywords: | capital investment decision, MSME, sequential-explanatory design, Digos City, Philippines |
| JEL: | D81 G31 L25 L26 M14 M2 M21 |
| Date: | 2016–07–12 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:79574&r=ppm |