nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2019‒01‒21
six papers chosen by
Arvi Kuura
Tartu Ülikool

  1. Bright Investments: Measuring the Impact of Transport Infrastructure Using Luminosity Data in Haiti By Mitnik, Oscar A.; Sanchez, Raul; Yanez-Pagans, Patricia
  2. An analysis of crowdfunded projects: KPI’s to success By Ieva Astrauskaitė; Arvydas Paškevičius
  3. The economic determinants of risk-adjusted social discount rates By Cherbonnier, Frédéric; Gollier, Christian
  4. A tale of REDD+ projects. How do location and certification impact additionality? By Philippe Delacote; Gwenolé Le Velly; Gabriela Simonet
  5. Impact of Decentralized Electrification Projects on Sustainable Development: A Meta-Analysis By Jean-Claude Berthelemy; Arnaud Millien
  6. Smart Specialisation in Sparsely Populated European Arctic Regions By Jukka Teras; Viktor Salenius; Laura Fagerlund; Lina Stanionyte

  1. By: Mitnik, Oscar A. (Inter-American Development Bank); Sanchez, Raul (IDB Invest); Yanez-Pagans, Patricia (IDB Invest)
    Abstract: This paper quantifies the impacts of transport infrastructure investments on economic activity in Haiti, using satellite night-light luminosity as a proxy measure. Our identification strategy exploits the differential timing of rehabilitation projects across various road segments of the primary road network. We combine multiple sources of non-traditional data and carefully address concerns related to unobserved heterogeneity. The results obtained across multiple specifications consistently indicate that receiving a road rehabilitation project leads to an increase in luminosity values of between 6% and 26% at the communal section level. Taking into account the national level elasticity between luminosity values and GDP, we approximate that these interventions translate into communal section-GDP increases of between 0.5% and 2.1%, for communal sections benefited by a transport infrastructure project. We observe temporal and spatial variation in results, and crucially that the larger impacts appear once projects are completed and are concentrated within 2 km buffers around the intervened roads. Neither the richest or the poorest communities reap the benefits from road improvements, with gains accruing to those in the middle of the ranking of communal sections, based on unsatisfied basic needs. Our findings provide novel evidence on the role of transport investments in promoting economic activity in developing countries.
    Keywords: Haiti, night-time luminosity, road investments
    JEL: O1 O47 R4 D04
    Date: 2018–12
  2. By: Ieva Astrauskaitė (Vilnius University [Vilnius]); Arvydas Paškevičius (Vilnius University [Vilnius])
    Abstract: The perception of alternative finances is stimulating the global financial markets and competition between banking funding and non-banking one. In order to encourage the demand of alternative funding the overall studies and researches concentrate on different relationships of economic indicators, describing lending, savings, prosperity, GDP per capita, etc. However, there is still a lack of encouragement to the market participants to provide the market with ideas and projects, which could be crowdfunded. In order to put the efforts for the better acknowledgement and demand incentives this paper was worked up. With the aim to introduce the key performing indicators (KPI's) for successful projects, which were financed through crowdfunding platforms, the comparative analysis was made, using Pearson correlation. It has been found, that narrative of the project and visualization are among the successful factors for crowdfunding. However, the requested amount of money, location or category of the project seemed to have lesser effect to success of crowdfunding. The results of the research are adoptable for initial offerings in crowdfunding platforms, potential projects owners, as well as the further researchers developing the topic of crowdfunding. With the strong novelty and broad (regionally) sample, the research represents its value and contributes to the theoretical and empirical background of crowdfunding.
    Keywords: correlation,alternative financing,key performing factors,crowdfunding
    Date: 2018–09–30
  3. By: Cherbonnier, Frédéric; Gollier, Christian
    Abstract: In theory, the measurement of the social value creation of any investment project requires estimating its consumption-based CAPM beta in order to compute its associated risk-adjusted discount rate. In order to assist evaluators to perform this task, we link this social beta to the underlying technical and economic environment of the project, such as the price and income elasticities of the supply and demand for the flow of goods and services generated by the investment. When the consumers’ willingness to pay and the variable production cost are Cobb-Douglas in aggregate income and quantity, the beta of the infrastructure has a flat term structure, and is positive for a normal good. But when the infrastructure has a limited capacity, the term structure of the beta is decreasing. Finally, as an illustration, we explain why an investment in a transfrontier trading infrastructure line should have a negative beta for the country that most often uses the line to export its cheaper good (such as electricity).
    Keywords: Investment valuation; investment decision; CCAPM; risk-adjusted discount rate
    JEL: D61 D92 G11
    Date: 2018–10
  4. By: Philippe Delacote (BETA - Bureau d'Économie Théorique et Appliquée - INRA - Institut National de la Recherche Agronomique - UNISTRA - Université de Strasbourg - UL - Université de Lorraine - CNRS - Centre National de la Recherche Scientifique); Gwenolé Le Velly (CEE-M - Centre d'Economie de l'Environnement - Montpellier - FRE2010 - INRA - Institut National de la Recherche Agronomique - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier); Gabriela Simonet (CEE-M - Centre d'Economie de l'Environnement - Montpellier - FRE2010 - INRA - Institut National de la Recherche Agronomique - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)
    Abstract: Since the emergence of the REDD+ mechanism, hundreds of projects have emerged around the globe. Much attention has been given to REDD+ projects in the literature, but the conditions under which they are likely to be efficient ares till not well known. In this article, we study how the location of REDD+ projects is chosen and how those location choices influence project additionality. Based on a sample of six REDD+ projects in Brazil, we propose an empirical analysis of the location choices and estimate additionality in the first years of implementation using impact evaluation techniques. In order to explain the heterogeneity of the empirical results, we present a simple theoretical model and show that project location is strongly influenced by the type of project proponent, which appears to be a good proxy for its objectives, whether oriented toward environmental impacts, development impacts, or external funding. Our results suggest that (1) the incentives behind REDD+ certification mechanisms can lead to low environmental efforts or an investment in areas that are not additional, (2) location biases are dependent on the REDD+ project manager's type, and (3) the existence of a location bias does not necessarily preclude additionality.
    Keywords: additionality,conservation policy,deforestation,REDD+,spatial analysis.
    Date: 2018–12–14
  5. By: Jean-Claude Berthelemy (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, FERDI - Fondation pour les Etudes et Recherches sur le Développement International); Arnaud Millien (CES - Centre d'économie de la Sorbonne - UP1 - Université Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, FERDI - Fondation pour les Etudes et Recherches sur le Développement International)
    Abstract: This paper is the first product of a project which aims to build a Collaborative Smart Mapping of Mini-grid Action (CoSMMA), whose principal objective is to identify best practice in decentralized electrification projects. Using evaluations of 421 projects, from published research papers, we built a pilot CoSMMA which proves its feasibility. Its relevance is demonstrated by a meta-analysis, which reveals the principal characteristics of decentralized electrification projects which have positive impacts on sustainable development. Four main characteristics were considered: technology (source or energy), system size (power), decision level (from local to country level) geographic location. When searching for best practices, technology and system size must be considered together, because the chosen technology may constrain the power, which is provided by the system. We find that the most popular projects, which are based on Solar Home Systems (SHS) are not the most effective. The problem with SHS is not the use of solar energy, but the small system size often chosen for SHS. Mini-grids, of larger size, especially those which use hybrid renewable sources of energy, have more positive impacts, because these systems combine the benefits of sustainability and flexibility. In terms of decision level, we find that both top-down and bottom-up approaches have advantages, with the observation of a U-shaped curve for the influence of the decision level on the probability of obtaining positive impacts. Geographical location matters, as it is very often the key to system feasibility. We find that DEPs are more effective in Latin America than in Asia, and more effective in Asia than in Africa. We also attempted to study the type of effects resulting from DEPs. Descriptive data suggest that for some types of effects, positive impacts are more likely than for others. Decentralized electrification projects have a more positive impact on Lifestyle & NICT or Household agenda than on Economic transformation or Community life. However, this pilot CoSMMA does not contain enough information to study precisely the types of effects, because some types of effects have not been studied frequently in the existing literature. This is the case, for instance, for environmental effects, which have been rarely measured scientifically. Finally, we attempted to broaden our information set by including expert data, which was entered into the CoSMMA meta-analysis. We define expert data as data that are not supported by statistical tests with measures of significance, whereas the evaluations based on scientific data were supported by statistical tests of significance. The expert data may be valid, but our attempt to include it in the analysis failed at this stage. The determinants of unproven effects appear to be quite different from the determinants of proven effects in our meta-analysis, and using expert data would imply merging proven and unproven effects, which would totally blur the conclusions.
    Keywords: decentralized electrification,sustainable developement,impact assessment,meta-analysis,méta-analyse,électrification décentralisée,développement durable,évaluation d'impact
    Date: 2018–12
  6. By: Jukka Teras (Nordregio); Viktor Salenius; Laura Fagerlund; Lina Stanionyte (European Commission - JRC)
    Abstract: The purpose of this report is to explore how smart specialisation (S3) has been applied in Nordic sparsely populated regions, with focus on European Arctic. The report gives overview of the specific context of Arctic regions, their specialisations and revises how smart specialisation has supported regions in addressing the Arctic challenges. It also identifies the needs and efforts of joint action and outlines good practise cases where collaborative effort has been taken to tackle common challenges or to exploit opportunities. Smart specialisation has found very relevant applications in the European Arctic Region and implementation of smart specialisation policy tools is well advanced. In some cases the Arctic regions are pioneering with the advanced approaches of collaboration and developing joint investment solutions applying S3 approach. This report emphasises that already today there are very successful cases of local, cross-regional, and cross-border collaboration in turning the Arctic context to a competitive advantage, and many new innovations and projects continue to emerge. As demonstrated in the case studies the smart specialisation can serve very well in mobilising regional and local actors in the Arctic. In sparsely populated areas there is more need interregional cooperation plays important role for critical mass formation. The important message of the cases presented throughout the report is that collaboration on joint opportunities is the only way to create sustainable and long-term smart specialisation solutions in the unique European Arctic context.
    Keywords: Regional Policy, Smart Specialisation, EU Arctic Policy, Arctic Regions, Sparsely Populated Areas, Place-based Approach, Interregional Cooperation
    Date: 2018–12

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