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on Project, Program and Portfolio Management |
| By: | Pierre Jacquet (ENPC - École nationale des ponts et chaussées - IP Paris - Institut Polytechnique de Paris, FERDI - Fondation pour les Etudes et Recherches sur le Développement International) |
| Abstract: | This paper analyses derisking in development finance and shows that the failure of the slogan "from billions to trillions" does not condemn the approach, but rather reveals a poorly conceived quantitative ambition. The use of public funds is legitimate only if the investment yields a social return greater than its private return, if the private sector would not have invested on its own, and if no other use of public funds is more effective. Implementing derisking requires genuine public-private engineering: detailed risk analysis, specialist expertise, robust project pipelines and the removal of regulatory barriers that hinder risk-sharing instruments. An effective derisking policy must prioritise additionality, risk assessment and risk management, address criticisms regarding its political legitimacy and the risk of subordinating the collective interest to private interests, promote guarantees in particular, and remain complementary to other development finance instruments. |
| Keywords: | Derisking, Development financing |
| Date: | 2026–07–30 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05707536 |
| By: | Gyöngyi Lóránth (University of Vienna & CEPR); Alan D. Morrison (Saïd Business School, University of Oxford, CEPR, & ECGI); Jing Zeng (University of Bonn & CEPR) |
| Abstract: | We study how firms can design their organizational structures to overcome dynamic commitment problems when entering new markets or technologies. A manager must exert costly effort to first develop and subsequently manage an investment opportunity. Ex post, the firm underinvests in projects that generate high management rents. However, the prospect of those rents helps offset the manager’s initial project development cost, making ex ante commitment to invest optimal. Levered subsidiaries mitigate this time-consistency problem by introducing risk-shifting incentives that counteract underinvestment. Subsidiaries are most valuable for projects that are costly to develop, have moderate management costs, and yield returns uncorrelated with existing business. |
| Keywords: | Organizational structure, investment strategy, branch, subsidiary |
| JEL: | G32 G34 L22 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:ajk:ajkdps:423 |
| By: | Agapitova, Natalia; Nedayvoda, Anastasia; Winkler, Stephen Joseph; Rothschild, Amschel Nathaniel De; Ertekin, Ergun; Lenoble, Sarah |
| Abstract: | This paper employs large-scale text analytics and generative artificial intelligence methods to analyze innovation patterns within the World Bank Group portfolio. It draws on more than 7, 500 Independent Evaluation Group project evaluations completed between 1998 and 2025. The study finds that, on average, innovative projects are associated with higher performance outcomes. It also identifies several key enabling factors for innovation at the World Bank Group, including disciplined experimentation, flexible and adaptive project designs, contextualization to local settings, participatory approaches in the design and piloting of new solutions, and visionary and supportive internal leadership. The analysis reveals that innovation within the World Bank Group has evolved over time from sporadic experimentation to an embedded organizational capability. However, significant constraints persist, such as bureaucratic fragmentation, capacity gaps, overly complex project designs, lack of continuity in scaling innovations, and insufficient incentives for learning and adaptation. |
| Date: | 2026–05–20 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:11392 |
| By: | David P. Glancy; Robert J. Kurtzman; Lara Loewenstein |
| Abstract: | Place-based policies are often caught between two potentially conflicting aims: (i) directing aid to needy communities and (ii) spurring investment. We study this tradeoff in the context of the Opportunity Zones (OZ) program. Leveraging unique phase-level microdata on commercial construction projects, we show that US state governors prioritized designating tracts where construction projects were already being planned. About two-thirds of the greater construction growth in OZs can be attributed to this selection. States prioritizing tracts with greater investment opportunities observed larger construction increases in designated tracts. We calibrate a structural model to quantify the effects of the program and examine counterfactuals under alternative preferences or eligibility criteria. |
| Keywords: | opportunity zones; commercial real estate; construction; time-to-plan |
| JEL: | R23 R32 R58 |
| Date: | 2026–07–17 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedgfe:103646 |
| By: | Perotti, Enrico; Terovitis, Spyros |
| Abstract: | We study how a primary need for minimum safety affects investment choices. In addition to risky projects, agents may choose to invest in personal assets they can control. Investing in personal assets serves as self-insurance, as they ensure a higher minimum return but offer a lower expected return than the risky project offers. In autarky, investors can achieve safety only via self-insurance and costly liquidation of the project. Private intermediaries can reduce inefficient self-insurance by offering safe debt backed by self-insured investors holding equity and can resolve the underlying risk conflict by demandable debt. Public debt crowds out the private supply of safe assets, lowering the safe rate and aggregate investment. In contrast, deposit insurance can either decrease or increase the private supply of safe assets, as well as the safe rate and aggregate investment. Our approach explains the vast and inelastic demand for safe assets, which are hard to explain by standard preferences at times of minimal rates. |
| Keywords: | Safe assets; Demandable debt; Intermediation |
| JEL: | G21 G28 G11 G51 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19405 |
| By: | Helena Cordt; Julien Daubanes; Yiding Ma; Julien Xavier Daubanes |
| Abstract: | In the spirit of green finance taxonomies, restricting fossil-fuel producers' access to funds is hoped to help address the climate problem. We develop a project-level model of oil production, calibrate it to the universe of U.S. and Canadian oil projects producible over 2000-2024, and simulate the effects of the cost of capital. Modest increases in this cost are counterproductive, increasing oil production through industry short-termism while reducing project value. Effective costs of capital are unrealistically large, at odds with projects' internal rates of return. At the industry level, a higher cost of capital generates equilibrium adjustments that boost oil profitability. |
| Keywords: | oil divestment, green finance, short-termism, unintended policy impact, internal rates of return |
| JEL: | G1 H20 Q31 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12865 |
| By: | Michele Liberatore; Massimo Riccaboni |
| Abstract: | We study how licensing affects the allocation of innovation in pharmaceutical R&D. We develop a model in which projects differ in both quality and innovation regime, distinguishing between incremental and novel innovations. Information precision is higher for incremental projects and lower for novel ones, generating different equilibrium dynamics in the market for technology. The model predicts that licensing sustains positive selection and competitive return equalization for incremental innovation, while novel projects may exhibit weaker screening consistent with lemons-type frictions. Using product-level data and Double Machine Learning methods, we test these predictions across success probabilities and monetary returns. We find that licensing increases success probability overall, but return equalization holds primarily for incremental projects. For novel innovation, licensing does not exhibit the same equilibrium adjustment, suggesting residual market imperfections. Instrumenting for licensing using exogenous pipeline shocks confirms this pattern causally: the competitive risk-return trade-off is preserved for incremental 'rushed' licenses, but it breaks down for novel ones. Our results reconcile evidence on both competitive efficiency and information frictions in markets for technologies, showing that market performance depends systematically on the type of innovation being transacted. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2607.20365 |
| By: | Mathias Dolls; Sebastian Link; Matti Liski; Gerome Wolf |
| Abstract: | Europe's green transition requires an unprecedented volume of private investment. Despite rising carbon prices in the EU Emissions Trading System (ETS) – captured by the ETS Emission Allowances – corporate investments in climate-related initiatives remain insufficient to align with the goals set forth in the Paris Agreement. This shortfall raises critical questions: At what carbon price levels will firms invest in green projects? Additionally, how does uncertainty about future prices affect their decisions?To address these issues, the authors of this report conducted a conjoint survey experiment involving 830 German manufacturing firms. The results reveal that price levels and price stability are both crucial for decarbonization. While higher expected carbon prices strongly incentivize corporate action, with firms favoring green projects as prices cross the EUR 90–100 threshold, volatility severely deters it. High uncertainty about future prices creates a "wait-and-see" effect that completely offsets the positive impact of a massive carbon price increase. Furthermore, institutional trust acts as a powerful multiplier; firms that perceive climate policies as credible are substantially more willing to commit capital.Therefore, unlocking private green investment requires policymakers to do more than sustain ambitious carbon prices. They must actively reduce downside risks by implementing robust price stabilization mechanisms, such as price floors or corridors, and ensure long-term institutional commitment. These elements need to be incorporated into the future reform of the EU ETS framework, especially ETS-2, which is now expected to become fully operational in 2028. |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:econpr:_58 |
| By: | Xu, Zhaoyang; Zhu, Lei; , KuoRayMao; Xue, Yongji |
| Abstract: | In the context of global climate mitigation, low carbon energy transitions have become central to sustainable development. However, while pursuing environmental objectives, such transitions may also reshape patterns of resource distribution and participation through institutional arrangements, generating new forms of inequality across distributive, procedural, and recognition dimensions. China, as the world's largest developing country and a major carbon emitter, provides an analytically rich context for examining how low carbon transitions intersect with equity concerns. This study investigates three photovoltaic projects in China: the Tengger Desert New Energy Base in Ningxia, the Dezhou Rooftop PV Program in Shandong, and the Yancheng Solar-Fishery Integration Project in Jiangsu. Drawing on field interviews and policy document analysis, the study employs a thematic grounded coding approach to develop a four dimensional analytical framework covering spatial entitlements, revenue distribution, technological adaptation, and policy design. The findings show that vulnerable rural communities often face constrained spatial rights, limited benefit sharing, uneven adaptive capacity, and restricted participation in top down governance processes. Based on this analysis, the paper develops policy recommendations to enhance institutional inclusiveness, optimize benefit-sharing mechanisms, and strengthen local governance capacity. These insights provide both theoretical contributions to the study of energy justice and practical references for promoting equitable and sustainable energy transitions in the Global South. |
| Date: | 2026–07–17 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:56j9h_v1 |
| By: | Kollar, Justin |
| Abstract: | Beneath the dramatic expansion of AI computing and digital systems across the world, data centers and energy systems are being constructed within inherited land and property institutions. Because of this, the consequences of this buildout—including resource strain and environmental and health impacts—are unevenly distributed, particularly in rural areas like Appalachia long structured by concentrated land ownership and extractive power relations. Recent discourse has focused on the implications of AI and digital systems for governance, as well as the immense resource demands of computing infrastructure. This article seeks to link these concerns by examining the unequal power relations involved in the production of computing infrastructure, including “powered land, ” through which non-tech entities assemble land and entitlements as an asset for sale or rent to operators and AI labs. Within the historically extractive landscape of West Virginia, I examine the mechanisms of infrastructural enclosure that enable and sustain this asset against local resistance, including the passage of HB 2014 and HB 2002, which aim to remove local land-use authority, divert fiscal resources, and protect consequential information about proposed projects. A critical component of this process is asymmetric legibility, through which project details are made coherent for those within the development network but intentionally fragmented and obscured for affected communities. Infrastructural enclosure extends accumulation by dispossession beyond the appropriation of land and resources to encompass the historically aligned regimes that legitimize dispossession and erode democracy and collective place identity. |
| Date: | 2026–07–30 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:xkhgc_v1 |
| By: | Liu, Xuan |
| Abstract: | Large-scale water resource reallocations combat regional scarcity but often obscure localized environmental costs. Evaluating China's South-to-North Water Diversion Project using a synthetic difference-in-differences framework, we estimate that the project increased topsoil salinity by an average of 3.16% in water-receiving counties. We show that this salinization is driven by a dual mechanism: new canal seepage artificially raises local water tables, while prohibitive marginal water prices prompt farmers to reduce irrigation, disrupting the traditional downward salt leaching process. The effects of this ecological shift are highly asymmetrical. Because post-diversion salinity remains safely within the tolerance range of winter wheat but systematically breaches the physiological yield-reduction threshold of summer maize, the environmental burden falls disproportionately on the summer growing season. Consistent with this biophysical constraint, we find that farmers rationalized production by reducing their maize acreage by 19%. Incorporating these estimates into structural agronomic models, we calculate that this asymmetric soil degradation exacts a marginal shadow cost of 920 million RMB per year in the agricultural sector. |
| Keywords: | Resource/Energy Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404732 |