nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2019‒04‒22
eight papers chosen by
Arvi Kuura
Tartu Ülikool

  1. Anchoring in Project Duration Estimation By Lorko, Matej; Servátka, Maroš; Zhang, Le
  2. Public Procurement as a Demand-side Policy: Project Competition and Innovation Incentives By De Chiara, Alessandro; Iossa, Elisabetta
  3. External R&D Acquisition and Product Innovation By OA Carboni; G. Medda
  4. An introduction to Participatory Value Evaluation By Niek Mouter; Paul Koster; Thijs Dekker
  5. Chinese aid and local ethnic identification By Isaksson, Ann-Sofie
  6. Implementing the Strategy for financial reform of higher education in Mozambique (EFES) By Bart Fonteyne; Ben Jongbloed
  7. HISTORY’S COILS: The UC Nuclear Weapons Laboratories By Pelfrey, Patricia A
  8. Knowledge networks in the German bioeconomy: Network structure of publicly funded R&D networks By Bogner, Kristina

  1. By: Lorko, Matej; Servátka, Maroš; Zhang, Le
    Abstract: The success of a business project often relies on the accuracy of its schedule. Inaccurate and overoptimistic schedules can lead to significant project failures. In this paper, we explore whether the presence of anchors, such as relatively uninformed suggestions or expectations of the duration of project tasks, play a role in the project estimating and planning process. Our laboratory experiment contributes to the methodology of investigating the robustness and persistence of the anchoring effect in the following ways: (1) we investigate the anchoring effect by comparing the behavior in low and high anchor treatments with a control treatment where no anchor is present; (2) we provide a more accurate measurement by incentivizing participants to provide their best duration estimates; (3) we test the persistence of the anchoring effect over a longer horizon; (4) we evaluate the anchoring effect also on retrospective estimates. We find strong anchoring effects and systematic estimation biases that do not vanish even after the task is repeatedly estimated and executed. In addition, we find that such persisting biases can be caused not only by externally provided anchors, but also by the planner’s own initial estimate.
    Keywords: project management, project planning, time management, anchors, anchoring effect, task duration, duration estimation, time estimation, anchoring bias
    JEL: C91 D83 D92 O21 O22
    Date: 2019–04–12
  2. By: De Chiara, Alessandro; Iossa, Elisabetta
    Abstract: We develop a model of project competition to compare two alternative and widely used approaches: (i) A (demand-side) procurement approach, in which the public authority specifies the type of project it will finance and (ii) a (supply-side) grant system, in which any type of project can be funded. The public authority can verify the characteristics of the projects submitted, but does not know which other projects are available. The paper sheds light on the role of public procurement to foster innovation.
    Keywords: Crowding out; innovation policy; Procurement; Research and Development; Steering effect
    JEL: D8 H57 L2 O31 O38
    Date: 2019–04
  3. By: OA Carboni; G. Medda
    Abstract: The outsourcing of R&D activities is considered an important way to acquire external technological information that can be integrated into a firm's own knowledge endowment. Given the complex relationship between R&D partnerships and innovation performance, it becomes of paramount importance for scholars, managers and policy-makers to understand whether and how outsourcing benefits the firm. This paper tries to assess the impact that external sources of R&D may have on product innovation, differentiating between R&D supplied by universities and other companies. The empirical analysis is based on a large and representative sample of European manufacturing companies. The analysis considers R&D an endogenous decision in investigating its effect on product innovation. An instrumental variable two-step estimation method is employed to deal with this issue. The results suggest that R&D intensity, or the share of R&D acquired from external sources, has a positive and significant effect on product innovation. Furthermore, we find evidence of an inverse U-shaped relationship between R&D outsourcing and innovation, meaning that on average, costs start to outweigh benefits as the R&D collaboration projects increase. We also estimate high returns from R&D acquired from universities on the probability to achieve product innovations, while having firms in the same group as research partners has the largest effect on innovative product sales. The results have straightforward implications for the practice of R&D managers. In order to gain advantages from partnership in research, innovation managers need to jointly exploit these different types of collaboration activities and their potential synergies. Given that the innovative firms in the sample desire additional credit which actually they do not obtain, R&D managers should also be concerned with the financing sources firms have access to. Finally, the analysis suggests that managers ought to identify the appropriate level of external acquisition in order to fully benefit on innovation.
    Keywords: External R&D;research partners;innovation performance;IV model
    Date: 2019
  4. By: Niek Mouter (Delft University of Technology); Paul Koster (Vrije Universiteit Amsterdam); Thijs Dekker (University of Leeds)
    Abstract: Cost-Benefit Analysis (CBA) for public policies assumes ‘consumer sovereignty’, implying that impacts of government projects can be valued by aggregating individuals’ private willingness to pay. However, individuals’ private willingness to pay might not reflect their preferences towards public policies. Participatory Value Evaluation (PVE) is a novel evaluation approach which rectifies this limitation of CBA. PVE establishes the social welfare effects of government projects through the elicitation of individuals’ preferences over the allocation of public budgets as well as their net income. The most important innovation of PVE is therefore that the approach goes beyond the paradigm of ‘consumer sovereignty’ by starting from the assumption of ‘citizen sovereignty’. This paper positions PVE relative to past innovations in applied welfare economics and illustrates the potential of the approach through a case study on flood protection schemes in the Netherlands.
    Keywords: Cost-benefit analysis; Partipatory value evaluation; Participatory budgetting; Consumer sovereignty
    JEL: D71 D61 D63
  5. By: Isaksson, Ann-Sofie (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Recent empirical evidence suggests that Chinese development finance may be particularly prone to elite capture and patronage spending. If aid ends up in the pockets of political elites and their ethno-regional networks, this may exacerbate grievances based in horizontal inequalities. Against this background, the present study investigates whether the implementation of Chinese development projects fuels local ethnic identities. A new geo-referenced dataset on the subnational allocation of Chinese development finance projects to Africa over the 2000-2014 period is geographically matched with survey data for 94,954 respondents from 18 African countries. The identification strategy consists in comparing sites where a Chinese project was under implementation at the time of the interview, to sites where a Chinese project will appear subsequently but where implementation had not yet started at the time of the survey. While suggesting substantial country variation, the empirical results indeed suggest that, on average, living near an ongoing Chinese project fuels ethnic identification. I consider two mechanisms possibly underlying this result. First, competition for the inflow of resources that aid constitutes could mobilize ethnic identities across the board. Second, perceptions of ethnically biased aid may fuel ethnic identities in groups perceiving themselves as disadvantaged. Two observations speak in favour of the latter mechanism. First, the estimated effect is not uniform across groups, but driven by people belonging to the out-group. Second, there is no indication of an equivalent pattern when considering development projects of other donors. Replicating the key analysis for World Bank projects as well as for other bilateral donors, the results in fact indicate the reverse, i.e. that living near an ongoing as opposed to a future project comes with weaker ethnic identification.
    Keywords: China; aid; ethnic identities; Africa
    JEL: F35 O19 O55
    Date: 2019–04
  6. By: Bart Fonteyne; Ben Jongbloed
    Abstract: This report describes the results of more than fifteen years of cooperation between the Government of Mozambique, the Government of the Netherlands, the Mozambican higher education institutions and the relevant stakeholders in designing and implementing reforms in the financing of higher education in Mozambique. Through the support of NUFFIC, the Dutch organisation for internationalisation in education, many collaborative projects – all of them managed by CHEPS – were undertaken to develop and implement a revised financing framework for the rapidly growing Mozambican higher education system – a system confronted by many challenges in terms of access, quality and efficiency. This report includes: (1) an historical overview of the various events that have shaped the financing situation from the year 2000 onwards; (2) the rationale for the financial reforms, (3) the design of a revised policy framework, together with a novel approach for the monitoring and evaluation of the policy mix; (4) the intense consultation processes and simulations undertaken during the 2011-2017 implementation phase, (5) a detailed description of the design of each of the three funding streams included in the revised funding framework, together with a discussion of the various trade-offs implied by the framework. In the final chapter, the report provides conclusions and recommendations on how the implementation of the financial reform can be continued successfully.
    Keywords: Mozambique, higher education finance, cost sharing, funding formulas, policy evaluation
    Date: 2018
  7. By: Pelfrey, Patricia A
    Abstract: Early in the Second World War, Franklin Roosevelt appealed to the nation’s elite universities to join in the quest for powerful new technological weapons to counter the Nazi threat. Urged on by Nobelist Ernest O. Lawrence, inventor of the cyclotron and director of the Berkeley Radiation Laboratory, the University of California responded to Roosevelt’s call in 1943 by lending its scientific leadership to the Manhattan Project at Los Alamos, New Mexico. The goal: to design and build the world’s first atomic bomb. UC president Robert Gordon Sproul intended from the outset that the University’s involvement in secret weapons research would end with the conflict itself. In the end, an engagement entered into as an act of wartime service became a more or less permanent marriage that was controversial from the start. What justification could a public university—any university—offer for conducting research on weapons of mass destruction? Decades of public protest and faculty criticism did not end UC’s involvement in the weapons laboratories it managed for the federal government, first at Los Alamos and later at Livermore, California. What almost did was a series of sensational events that began in 1999 with charges that a spy was at work in Los Alamos’s X Division, responsible for the design of nuclear weapons. The ensuing espionage trial and its aftermath sent shock waves that spread far beyond the specific details of the case. They precipitated a series of events involving national security, US nuclear policy, and politics within the Department of Energy and the Congress that cast a shadow over UC’s stewardship.  The University and its president, Richard Atkinson (1995-2003), faced fundamental questions about the direction and future of an increasingly contentious partnership. This paper discusses the University’s evolving relationship with the federal government and how the debate over the nuclear weapons laboratories ultimately shifted from morality to management.
    Keywords: Education, University of California, nuclear weapons research, university service, national interest
    Date: 2018–04–22
  8. By: Bogner, Kristina
    Abstract: Aiming at fostering the transition towards a sustainable knowledge-based Bioeconomy (SKBBE), the German Federal Government funds joint and single research projects in predefined socially desirable fields as, for instance, in the Bioeconomy. To analyse whether this policy intervention actually fosters cooperation and knowledge transfer as intended, researchers have to evaluate the network structure of the resulting R&D network on a regular basis. Using both descriptive statistics and social network analysis, I investigate how the publicly funded R&D network in the German Bioeconomy has developed over the last 30 years and how this development can be assessed from a knowledge diffusion point of view. This study shows that the R&D network in the German Bioeconomy has grown tremendously over time and thereby completely changed its initial structure. While from a traditional perspective the development of the network characteristics in isolation seems harmful to knowledge diffusion, taking into account the reasons for these changes shows a different picture. However, this might only hold for the diffusion of mere techno-economic knowledge. It is questionable whether the artificially generated network structure also is favourable for the diffusion of other types of knowledge, e.g. dedicated knowledge necessary for the transformation towards an SKBBE.
    Keywords: knowledge,dedicated knowledge,knowledge diffusion,social networks,R&D networks,Förderkatalog,sustainable knowledge-based Bioeconomy (SKBBE)
    Date: 2019

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