nep-ppm New Economics Papers
on Project, Program and Portfolio Management
Issue of 2023‒05‒22
eleven papers chosen by
Arvi Kuura
Tartu Ülikool

  1. Organizational Capacity and Project Dynamics By Foarta, Dana; Ting, Michael M.
  2. Coordination on networks with farsighted and myopic agents By Ana Mauleon; Simon Schopohl; Akylai Taalaibekova; Vincent Vannetelbosch
  3. Does Official Development Assistance Benefit the Donor Economy? New evidence from Japanese overseas infrastructure projects By NISHITATENO Shuhei
  4. The dynamic approach of modelling regional recovery investment policies using environmentally-extended SAM Matrix By Darlington Agbonifi
  5. The impact of public support for innovation on SME performance and efficiency By Raphaël CHIAPPINI; Sophie POMET
  6. Do Renewables Create Local Jobs? By Natalia Fabra; Eduardo Gutiérrez; Aitor Lacuesta; Roberto Ramos
  7. Community Hubs to Support Energy Transition By Look, Wesley; Haggerty, Mark; Mazzone, Daniel
  8. More information, better knowledge? The effects of information campaigns on aid beneficiaries' knowledge of aid projects By Alexander De Juan; Paul Hofman; Carlo Koos
  9. What Is An “Energy Community†? Alternative Approaches for Geographically Targeted Energy Policy By Pesek, Sophie; Raimi, Daniel
  10. Learning How to Build Back Better through Clean Energy Policy Evaluation By Aldy, Joseph E.
  11. Do residents living in transit-oriented development station catchment areas travel more sustainably? The impacts of life events By Shen, Tonggaochuan; Cheng, Long; Yang, Yongjiang; Deng, Jialin; Jin, Tanhua; Cao, Mengqiu

  1. By: Foarta, Dana (Stanford U); Ting, Michael M. (Columbia U)
    Abstract: This paper provides a dynamic theory of the effects of organizational capacity on public policy. Consistent with prevailing accounts, a bureaucratic organization with higher capacity, i.e., a better ability to get things done, is more likely to deliver projects in a timely, predictable, or efficient fashion. However, capacity also interacts with po- litical institutions to produce far-reaching implications for the size and distribution of public projects. Capacity-induced delays and institutional porousness can allow future political opponents to revise projects in their favor. In response, politicians design projects to avoid revisions, for example by equalizing distributive benefits, or by over- scaling projects. We show that higher organizational capacity can increase project size, inequalities in the distribution of project benefits, and delays. The range of capacity levels that produce low social benefits increases with the extent of institutional con- straints. This suggests that political systems with high capacity and high institutional constraints are especially vulnerable to inefficient projects.
    JEL: D73 D82
    Date: 2023–01
  2. By: Ana Mauleon (CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain = Catholic University of Louvain); Simon Schopohl (CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain = Catholic University of Louvain); Akylai Taalaibekova (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique); Vincent Vannetelbosch (CORE - Center of Operation Research and Econometrics [Louvain] - UCL - Université Catholique de Louvain = Catholic University of Louvain)
    Abstract: We study a coordination game on a fixed connected network where players have to choose between two projects. Some players are moderate (i.e. they are ex-ante indifferent between both projects) while others are stubborn (i.e. they always choose the same project). Benefits for moderate players are increasing in the number of neighbors who choose the same project. In addition, players are either farsighted or myopic. Farsighted players anticipate the reactions of others while myopic players do not. We show that, when all players are farsighted, full coordination among the moderate players is reached except if there are stubborn players for both projects. When the population is mixed, the set of stable strategy profiles is a refinement of the set of Nash equilibrium strategy profiles. In fact, turning myopic players into farsighted ones eliminates gradually the inefficient Nash equilibria. Finally, we consider a social planner who can improve coordination by means of two policy instruments: adding links to the network (socialization) and/or turning myopic players into farsighted ones (education).
    Keywords: Networks, Coordination problems, Stubborn players, Farsighted players, Stability
    Date: 2022
  3. By: NISHITATENO Shuhei
    Abstract: Given the growing pressure on donors to curtail foreign aid budgets, analyzing the effectiveness of bilateral official development assistance (ODA) in realizing national interests has become more significant than ever before. From the viewpoint of economic interests, prior research has revealed that ODA can help expand donor exports and outward foreign direct investments. This study provides evidence that ODA can also help firms from donor countries win infrastructure project contracts in recipient countries. Employing unique contract data on Japanese overseas infrastructure projects, I estimate a fixed effects Poisson model with a panel dataset for 158 recipients for the period between 1970 and 2020. The results suggest that 17% of the total number of overseas infrastructure projects contracted to Japanese firms during 1970–2020 were attributable to Japanese ODA disbursement. I also explore the potential mechanism, finding that the Japanese ODA-infrastructure link is strengthened when Japanese loans and grants are simultaneously provided to a recipient country. This finding is consistent with the view that pre-investment studies conducted as part of technical cooperation could generate goodwill effects for Japanese firms during their bidding for Japanese yen loan projects.
    Date: 2023–04
  4. By: Darlington Agbonifi (Department of Economics (University of Verona))
    Abstract: This paper analyzes the socioeconomic and environmental dynamic impacts of an exogenous public-financed increases in infrastructure investments and modernization projects (CIS) of around EUR 1097 billion for the 2021-2026 period on industrial outputs, household employment and income distribution, in the Italian province of Taranto using an environmentally extended Social Accounting Matrix (ESAM) techniques for the year 2015. This method reconciles the analysis of the impact of an investment policy aiming at climate neutrality on a local economy. As well as an in-depth evaluation of the intersectoral production linkages through trade and multiplier analysis, with the cost-benefit (CB) analysis of a large-scale investment project. The evaluation of the dynamic impacts on the local economy produces a benefit/cost ratio of 5.63 that increases to 7.88 when the CB analysis of the project, and therefore the revenues generated during the operational period, are also included. The inclusion of environmental externalities associated with industrial greenhouse gas (GHGs) emissions reduces by about 16% the benefit/cost ratio in the construction period. In the operational period, when we assume that green production technologies are adopted, the reduction of the ratio is more consistent. The distributional impact of the investments on the annual income of households is also acceptably equitable.
    Keywords: Policy Impact Evaluation, Cost Benefit Analysis, Local Economic Development, SAM
    JEL: C67 D57 Q56 Q58 R11
    Date: 2023–04
  5. By: Raphaël CHIAPPINI; Sophie POMET
    Abstract: This article examines the impact of two types of financial support for innovation granted by French public institutions to French SMEs on a set of firm performance measures. Using an original database that provides information on repayable advances and subsidies obtained by 5, 448 French SMEs over the period 2010-2016, we evaluate the effectiveness of such financial support using a quasi-experimental design. Our findings indicate that both repayable advances and subsidies significantly improve targeted SMEs’ turnover, level of intangible assets and total employment at one year and three years after support is granted. The impact on firm-level TFP is only positive and significant after three years, while being negative in the very short run. Our results also provide evidence that the combination of both instruments for a given innovation project within a year does not entail significantly higher effects. A heterogeneous analysis reveals that the impact of financial support instruments for innovation is significantly higher for young, micro and small firms. Furthermore, our analysis shows that innovation support benefits more to firms located in the Paris region than in other regions and this tends to exacerbate regional inequalities. Finally, our findings indicate that the transformation of Oséo into Bpifrance in December 2012 has led to an increase in the effectiveness of the innovation policy.
    Keywords: Innovation policy, firm performance, policy evaluation, Mahalanobis distance matching, difference-in-difference.
    JEL: O33 O38 C14 C21
    Date: 2023
  6. By: Natalia Fabra (UNIVERSIDAD CARLOS III); Eduardo Gutiérrez (Banco de España); Aitor Lacuesta (Banco de España); Roberto Ramos (Banco de España)
    Abstract: We investigate whether investments in renewable energy – solar and wind plants – create jobs in the municipality where they are located. Using 13 years of monthly data, we exploit the variation in the timing and size of investment projects across more than 3, 200 municipalities in Spain, a country with substantial investments in this area. We use a new estimator for staggered differences-in-differences analysis that extends the local projections approach with clean controls (Dube et al., 2022). We find strong heterogeneity in the magnitude and pattern of the impacts of solar and wind investments. On average, solar investments increase employment by local firms, but the effects on the unemployment of local residents are weak. The effects of wind investments on local employment and unemployment are mostly non-significant. These findings have important implications for public policy.
    Keywords: renewable energy, employment, unemployment, NIMBY, spatial effects
    JEL: L94 C33 O25 R23
    Date: 2023–01
  7. By: Look, Wesley (Resources for the Future); Haggerty, Mark; Mazzone, Daniel
    Abstract: The increasing competitiveness of clean energy and growing efforts to reduce greenhouse gas emissions are reshaping the US energy economy. For energy communities—cities, towns, and regions with deep ties to fossil fuel production and electricity generation—this transition may pose significant costs for workers, businesses, and local governments. Federal investments through things such as workforce development and infrastructure expansion can mitigate such costs and provide new opportunities for prosperity.A critical component of making such investments successful is tailoring them to the specific needs and unique circumstances of each community (Davis and Dumont 2021). Such tailoring can improve outcomes for workforce development programs (Harper-Anderson 2008; Pynes 2004) and possibly the cost-effectiveness of federal economic development efforts (Markusen and Glasmeier 2008).Such tailoring requires mechanisms for coordination between local leaders and the federal government. Local leaders, often working through community-based organizations (CBOs), tend to have the most nuanced understanding of the needs and opportunities in their communities and the local relationships and trust needed to get projects done. However, especially in low-income and isolated rural communities, they often lack resources to fully engage with the variety of federal programs that could benefit from their expertise (Pipa and Geismar 2020; Ajilore and Willingham 2020; Haggerty et al. 2018). It is therefore reasonable to consider that a federal energy transition policy would not only invest in workforce, infrastructure, and economic development but also local capacity required to effectively implement such policies. Capacity is generally defined here as “increasing the ability of people and institutions to do what is required of them†(Murray and Dunn 1995).This brief provides an overview of one option for building and supporting capacity in energy-dependent communities: creating a network of community “hubs†(Aspen Institute 2019; BlueGreen Alliance 2021) supported by a federally chartered development corporation. This concept leverages recent policy roadmaps produced by stakeholders from energy regions in transition emphasizing the importance of customization and investing in local leadership (Just Transition Fund 2020; BlueGreen Alliance 2021). Community hubs and the federal development corporation described here also share institutional design features with recommendations from the National Academies of Sciences (2021) related to just transition and a congressional proposal to reform the fiscal relationships between natural resources and rural economies (Forest Management for Rural Stability Act 2019; Iglehart 2018; Haggerty 2018).The Biden Administration’s Build Back Better (BBB) framework recognizes the need for local capacity building in rural America. For example, BBB proposed a $1 billion investment in a Rural Partnership Program (RPP), For more information on the Biden Administration’s Build Back Better framework (the American Jobs Plan) and the Rural Partnership Program, see which is intended to build the capacity of local organizations. Flexible, multiyear grants could be used to support collaborative planning, staffing, and implementation of locally led economic development efforts. Collaborations may include rural and Tribal governments, nonprofits, philanthropic organizations, community colleges, and other CBOs.These proposals and efforts reflect an embrace of place-based and people-centered models for economic development (Shambaugh and Nunn 2018; Topolsky 2021, Muro et al. 2021) and of government’s role in shaping markets and driving innovation (Mazzucato 2021). In the following sections, we provide detail on what we mean by a “community hub†and outline the key structural components of how a supported network of hubs might work—including the potential challenges.
    Date: 2022–02–15
  8. By: Alexander De Juan; Paul Hofman; Carlo Koos
    Abstract: Aid beneficiaries know very little about development interventions in their own communities. This lack of transparency and information is likely to reduce beneficiaries' ability and willingness to become active in local development. It may also dampen intended aid effects on beneficiaries' political and social attitudes. Can targeted information campaigns strengthen beneficiaries' understanding of aid projects? We test the effects of two types of interventions: the provision of information only and the combination of information and feedback opportunities.
    Keywords: Development aid, Information, Fragile states, Randomized controlled trial
    Date: 2023
  9. By: Pesek, Sophie (Resources for the Future); Raimi, Daniel (Resources for the Future)
    Abstract: The Inflation Reduction Act of 2022 seeks to dramatically increase clean energy innovation, manufacturing, and deployment in the United States. Unlike most previous federal energy policy, it ties many incentives to labor requirements, domestic manufacturing, and project location. We examine a provision of the law that offers additional financial incentives for projects to locate within “energy communities.†Our analysis indicates that the law’s definition of energy communities could vary widely depending on interpretation of key phrases. In addition, we find that the law, as written, is unlikely to steer investment specifically toward those communities that will be most heavily affected by a transition away from fossil energy. We illustrate these findings through three interpretations of the energy communities definition and show that it does not specifically target fossil energy–dependent local economies, but instead is likely to cover between 42 and 50 percent of US land area. We then offer our own definition of “energy communities, †which more narrowly targets locations that have been or are heavily dependent on fossil fuels as a driver of local economic activity, employment, and government revenue.
    Date: 2022–11–01
  10. By: Aldy, Joseph E. (Resources for the Future)
    Abstract: The Infrastructure Investment and Jobs Act, the CHIPS and Science Act, and the Inflation Reduction Act authorized and appropriated unprecedented spending and tax expenditures to decarbonize the American economy. In the spirit of “build back better, †this paper examines how integrating evaluation in the design and implementation of these new clean energy policies can facilitate the learning necessary for policymakers to make policy better over time. It draws lessons from two case studies: (1) on institutionalizing evaluation based on the experience with regulatory review, and (2) on conducting evaluation based on the research literature assessing the 2009 Recovery Act’s clean energy programs. The paper identifies in recent legislation the programs and their characteristics amenable to various evaluation methodologies. The paper closes with recommendations for a clean energy program evaluation framework that would enable implementation of climate-oriented learning agendas under the Evidence-Based Policymaking Act.
    Date: 2022–08–31
  11. By: Shen, Tonggaochuan; Cheng, Long; Yang, Yongjiang; Deng, Jialin; Jin, Tanhua; Cao, Mengqiu
    Abstract: Transit-oriented development (TOD) is an urban designed model aimed at attracting more sustainable travellers. However, not all TOD projects succeed in maintaining a high rate of sustainable travel behaviour. To examine the impacts of TOD on residents' travel behaviour, this paper applies binary logistic regression to analyse survey data for 1, 298 residents living in the TOD areas in Hangzhou collected in 2020. The results show that socioeconomic characteristics, built environment factors, and travel attitudes play important roles in influencing their travel mode choices. Furthermore, the number of children in households and higher levels of car ownership significantly influence residents' sustainable travel behaviours. However, it appears that only a limited number of factors can convince car users to shift to sustainable modes of travel, such as their workplace being accessible by metro and attitudes towards changes in accessibility. This research study contributes to the existing literature in terms of enhancing the understanding of travel mode choice behaviours, particularly with regard to people who live near public transport infrastructure, as well as formulating evidence-based TOD policies to achieve more sustainable transport systems.
    JEL: J1
    Date: 2023–04–04

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