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The paper focuses on an innovative bank-intermediated trade finance contract, which we call dynamic trade finance (DTF, under which banks dynamically adjust loan interest rates as an order passes through different steps in the trade process). We examine the value of DTF, the impact of process uncertainties and the associated information frictions on this value, and the strategic interaction between DTF and FinTech. As more than 30% of global trade involves bankintermediated trade finance (Bank for International Settlements 2014), examining contract innovation in trade finance (DTF) and its strategic interaction with FinTech is of practical importance. Also, analyzing trade finance in the presence of process dynamics and information frictions complements the existing academic literature. We construct a parsimonious model of a supply chain process consisting of two steps. The duration of each step is uncertain, and the process may fail at either step. Information delay may also occur when verifying that the requisites for passing a step have been satisfied. The seller (borrower) borrows from a bank to finance this 2-step process either through uniform financing (the interest rate remains constant throughout the process) or DTF (the interest rates are adjusted according to a pre-committed schedule as the process passes each step). While lending, the bank faces regulatory capital requirement (the bank is required to hold capital reserve when issuing risky loans) or information asymmetry (the borrower possesses more accurate information about the trade process than the bank). The value of DTF lies in its ability of reducing transactional deadweight loss (under regulatory capital requirement) and screening (separate high-quality borrowers from the low-quality ones under information asymmetry). This value increases as the trade process becomes more reliable or lengthier, yet its ability of screening is stronger when the process is less reliable. The severity of information delay hurts the value of DTF convexly. Numerical results based on calibrated parameters suggest that DTF could lower the borrower’s financing cost substantially. Finally, FinTech that expedites information transmission and verification and enables automatic execution complements DTF, and those that segment customers more efficiently could substitute DTF. Our results shed light on how the underlying trade process dynamics and the type of information frictions involved affect the optimal deployment of contract innovations (DTF) and FinTech in trade finance.

Research background: An investment appraisal applies a single discount rate across all effects. However, this may be insufficient for heterogenous environmental impacts, mixing private and public goods as well as use and non-use values, where individuals may have multiple intertemporal preferences due to their duality to act as consumer or citizen. Purpose: The paper aims at identifying the scope of discrepancies in the level of discount rate for public and private as well as use-and non-use investment gains. Research methodology: The contingent valuation method is used to elicit stated discount rates for 2 hypothetical investments: environmental or financial gains to distinguish between public and private domain accompanied by two time-frames: short (use values) and long (non-use values). Results: The discount rate for the environment is lower than for money. It is also lower for the long-term horizon in comparison with the short-term perspective. The discrepancies are observed also for explanatory variables in respect to a socio-economic profile and attitude characteristics. Novelty: The paper adds to the discussion on valuation discrepancies between self-interested consumers and socially oriented citizens. The scarcity of previous research examining discount rates for public/private goods as well as the short/long-time horizon make the results relevant for public policy dealing with climate change and environmental protection, providing an insight into individual intertemporal preferences.

Quantifying uncertainty over technologies, costs, and prices that stem from site-specific conditions, technological particularities and future projections is an important element in the investment appraisal of desalination facilities. Yet, the majority of economic assessments in the field of desalination plants, so far, use deterministic estimation methods based on ‘best guess’ estimates and ceteris paribus sensitivity analyses. Aiming to fill this gap, this paper introduces a new approach towards comparing alternative technological options for desalination facilities under uncertainty based on the Levelized Cost of Water (LCOW). The proposed framework combines Monte Carlo simulations with scenario analysis and random-walk-based models to account for the cone of uncertainty of the LCOW. For purely illustrative purposes, five alternative combinations of desalination technologies and energy sources are examined in the State of Kuwait. The findings show that the proposed framework, although it cannot eliminate uncertainty, can assist decision-makers in managing it by framing the range of possible outcomes of the LCOW. In this way, it offers an insight into the accuracy of the estimates and allows the validation of the impact of risks and uncertainties against the acceptable tolerance level. Yet, several issues need to be addressed in future research.

We present a simple, linear asset pricing model of the cross section of Mortgage-Backed Security (MBS) returns. MBS earn risk premia as compensation for their exposure to prepayment risk. We measure prepayment risk and estimate security risk loadings using real data on prepayment forecasts vs. realizations. Estimated loadings on prepayment risk are monotonically decreasing in securities’ coupons relative to the par coupon, as predicted by the fundamental effect of prepayment on the value of bonds trading above and below par. Prepayment risks appear to be priced by specialized MBS investors. In particular, we find convincing evidence that prepayment risk prices change sign over time with the sign of a representative MBS investor’s exposure to prepayment risk.

Value investing involves buying securities that appear cheap relative to some fundamental anchor. For equity investors, that anchor is typically a measure of intrinsic value linked to financial statements. Recently, much has been written about the death of value investing. Although undoubtedly many approaches to value investing have suffered recently, the authors find the suggestion that value investing is dead to be premature. Both from a theoretical and empirical perspective, expectations of fundamental information have been and continue to be an important driver of security returns. The authors also address critiques leveled at value investing and find them generally lacking in substance. TOPICSAnalysis of individual factors/risk premia, factor-based models, fundamental equity analysis Key Findings ▪ The authors address a series of possible (ex post) rationalizations of the recent underperformance of value strategies. They find little empirical evidence or theoretical foundation to support the criticisms. ▪ Building on prior academic research, the authors find strong evidence that fundamental information is relevant for stock prices. ▪ However, the authors find that there are periods in which stock prices become less connected to fundamental information; when value underperforms significantly, it is primarily attributable to a widening gap between prices and fundamentals.

Using the first reported case of COVID-19 in a given U.S. county as the event day, we find that firms headquartered in an affected county experience, on average, a 27-bps lower return in the 10-day post-event window. This negative effect nearly doubles in magnitude for firms in counties with a higher infection rate (−50 bps). We test a number of transmission channels. Firms belonging to labor-intensive industries and those located in counties with a large mobility decline have worse stock performance. Firms sensitive to COVID-19-induced uncertainty also exhibit more negative returns. Finally, more negative stock returns are associated with downward revisions in earnings forecasts.

We examine the economic determinants and consequences associated with the inclusion of covenants with similar levels of restrictiveness in bond contracts. Using a unique Moody’s bond covenant dataset, we develop measures that capture similarity in the restrictiveness of bond covenants relative to previously issued peer bonds. We document that the demand for similarity by issuers, their advisors and bond investors follows the predictions of sociological and economic theories. Further, consistent with similarity in covenants reducing bond investors’ information acquisition and processing costs, we show that bonds with more similar covenant restrictiveness receive lower yields at issuance. These bonds are also more likely to be held by long-term bond investors, such as insurance companies, and are characterized by greater liquidity in the secondary market, providing a partial explanation for the lower bond yields. Our results highlight the benefits of covenant similarity and suggest that the use of covenants with similar restrictiveness levels brings information acquisition and processing cost savings that may be larger than the monitoring benefits provided by covenants with more tailored features.

Over the last few years, a lot of press, pundit, and political attention has been paid to share repurchases, much of it critical. Most repurchase critics assert that share repurchases are at historical highs and that dollars spent repurchasing shares would otherwise be directed toward profitable investment. Some also credit recent stock market gains to the “sugar high” of share repurchases. The authors show that most of these criticisms are without merit (at least, merit that can be demonstrated), sometimes glaringly so. Aggregate share repurchase activity has not been at historical highs when measured properly, and when netted against debt issuance it is almost a non-event: It does not mechanically create earnings growth, does not stifle aggregate investment activity, and has not been the primary cause for recent stock market strength. These myths should be discarded.

Style investing has become part of the investing nomenclature for equity markets. To date, despite the massive size of fixed-income markets, little research has examined the efficacy of style-based investing in fixed income. In this article, the authors summarize a common style-based framework for capturing excess returns for both government and corporate bonds. Importantly, from an investor perspective, these style-based excess returns are highly diversifying with respect to the classic risk premiums in fixed-income markets (i.e., term premium and credit risk premium) and exhibit low macroeconomic sensitivities.

Empirical evidence suggests that investor protection significantly affects ownership concentration and asset prices. We develop a dynamic asset pricing model to address the empirical regularities and uncover some of the underlying mechanisms at play. Our model features a controlling shareholder that endogenously accumulates control over a firm, and diverts a fraction of its output. Better investor protection decreases stock holdings of controlling shareholders, increases stock mean returns, and increases stock return volatilities when ownership concentration is sufficiently high, consistent with the related empirical evidence. The model also predicts that better protection increases interest rates and decreases the controlling shareholder’s leverage.Received August 14, 2017; editorial decision January 15, 2019 by Editor Stijn Van Nieuwerburgh. Authors have furnished an Internet Appendix, which is available on the Oxford University Press Web site next to the link to the final published paper online.

Prior studies on the relation between corporate taxes and future macroeconomic growth present contradictory evidence. We argue this mixed evidence is at least partly due to the use of statutory corporate tax rates which ignore the complexity of tax exemptions, tax deductions, tax enforcement and firms’ tax planning. We propose an alternative tax rate measure that aggregates cash effective tax rates of listed firms, which reflect not only statutory tax rates, but also other features of the tax code, enforcement, and firms' tax planning. We find a strong robust negative relation between country-level effective tax rates and future macroeconomic growth.

Environmental investments, such as emission control measures hardly gain profit but are enforced by policy. Such investments can be expected to be delayed as much as legally feasible. Yet, if increasing expenditures for the same investment in the future are likely to occur, an advanced investment may be favorable. A cost calculation methodology for NOₓ control techniques and a real option based decision support model for investments not gaining economic profit is presented in the book.

Z vseh pogledov pridelave hrane se vse bolj kaže ekološko kmetijstvo kot tisti način kmetovanja, ki nam bo predstavljal vir bogate, naravno pridelane hrane, sonaravno z zemljo, ki jo obdelujemo. Izdelan je preusmeritveni načrt v ekološko kmetijo za samooskrbno konvencionalno hribovsko kmetijo Lebert, ki predvideva uvedbo dopolnilne dejavnosti ob preusmeritvi. S SWOT analizo so predstavljene prednosti, slabosti, priložnosti in nevarnosti kmetije. Z oceno ekonomskih in finančnih parametrov smo ovrednotili ekonomsko upravičenost preusmeritve in investicije. Finančni rezultat v konvencionalni pridelavi je znašal 17.801,74 € in v obdobju ekološke pridelave 25.717,34 €. Koeficient ekonomičnosti se je zvišal iz vrednosti 1,33 na 1,70, kar pomeni, da kmetija posluje ekonomično uspešnejše kot v konvencionalni pridelavi. Z oceno investicije smo analizirali peko kruha kot dopolnilno dejavnost na kmetiji. Glede na oceno prodaje, dela in stroškov se investicija ob predpostavljenih parametrih analize povrne v treh letih. Ekološko kmetijstvo je torej za manjše hribovske kmetije primerna razvojna usmeritev. From all aspects of food production, organic farming is increasingly seen as the way of farming which will present a source of rich, soil cultivated, naturally grown foods. A reorganization plan into an organic farm for the Lebert conventional hill farm has been developed, which envisages the introduction of supplementary activities. The SWOT analysis presents advantages, disadvantages, opportunities and threats. With the assessment of economic and financial parameters we evaluated the economic viability of the conversion and investment. The financial result in conventional production amounted to € 17,801.74 and in the period of organic production to € 25.717,34. The economic coefficient has risen from 1.33 to 1.70, which means that the farm operates economically more efficiently than it did in conventional production. With the evaluation of the investment, we analyzed bread baking as a supplementary activity on the farm. According to the estimates of sales, labor and costs, the investment is reimbursed in the assumed parameters of the analysis within three years. Organic farming is therefore an appropriate development orientation for smaller hill farms.

Ekološko kmetijstvo je način kmetovanja, ki pridobiva v slovenskem kmetijskem prostoru vse večji pomen. V diplomskem delu je bil izdelan preusmeritveni načrt za konvencionalno kmetijo Brancelj. Upravičenost pridelave smo ovrednotili z oceno ekonomskih parametrov. Ekonomska ocena kaže, da kmetija kljub manjšim spremembam po preusmeritvi v ekološko kmetovanje posluje ekonomsko uspešno (FR = 3.668,16 €). Ker se na kmetiji ukvarjajo tudi z gozdarsko dopolnilno dejavnostjo, smo s pomočjo ocene investicije analizirali, v katerem letu bi se investicija v to dejavnost tudi povrnila. Ugotovili smo, da se celotna investicija ob predpostavljenih parametrih analize povrne že v drugem letu (ocenjena vrednost neto sedanje vrednosti je 103.027,34 € pri 5,5-odstotni obrestni meri). Among different ways of farming, organic farming is getting more and more important in the Sloven agricultural area. In this thesis, a conversion plan was made for the conventional farm Brancelj. A production entitlement was evaluated with economic parameters. The economic evaluation shows that the farm, despite the small changes made after the restruction to ecological farming, is economically successful (FR = 3668.16 €). On the farm, they also conduct a supplementary forestry activity. For this reason, we analysed with the help of an investment evaluation, in which year the investment will be repaid. Via the presumed analysis parameters, it was found that the complete investment could be repaid next year (the estimated value of net present value is 103. 027.34 € at 5.5% interest rate).

International audience; As Mises pointed out, in the division of labor economizing valuations require an appraisement of the structure of market prices of goods beforehand. While this insight holds true for each and every good, investment decisions, e.g., concerning the purchase of an entire business enterprise, necessitate considerations beyond appraisement. As Herbener and Rapp (2016) illustrated, an economizing valuation of businesses must be based upon both appraisement and a genuine investment appraisal which provides the valuing person with the marginal price he can barely accept. However, even though the computation of this marginal price is an obligatory step towards an economizing investment decision, it is still not sufficient solely. In contrast to the purchase of a consumer good in which the asking price is known a priori and can be compared to the benefits of the good concerned by the valuing person directly, in case of the purchase of businesses, the price to be paid is unknown a priori; it is rather the outcome of a negotiation. Therefore, an economizing valuation of firms not only requires both appraisement and investment appraisal but also a negotiation of the final price to be paid. Since the corresponding negotiation process must be characterized as a terra incognita in Austrian economics, consequently, this paper investigates the negotiation between the involved parties as the final step towards their economizing valuations in depth and deduces guidance for an appropriate negotiation.

We propose two explanations for the previously documented relation between aggregate earnings growth and future inflation: one based on firms changing their investment in response to earnings growth, and the other based on consumers varying their consumption in response to wealth effects of profitability growth. As the supply of goods and services is relatively inelastic in the short run, our arguments imply that changes to near-term demand for investment (consumption) will affect the prices of investment (consumption) goods and services. Consistent with the investment-based argument, we find that profitability changes predict investment and Producer Price Index (PPI) shifts in subsequent quarters. Our analyses also reveal that aggregate earnings growth predicts future investment and PPI forecast errors. We find, at best, weak evidence for the consumption-based link between aggregate earnings growth and future inflation.

Background: South Africa is planning to introduce a carbon tax as a Pigouvian measure for the reduction of greenhouse gas emissions, one of the tax bases designed as a fuel input tax. In this form, it is supposed to incentivise users to reduce and/or substitute fossil fuels, leading to a reduction of CO2 emissions. Aim: This article examines how such a carbon tax regime may affect the individual willingness to invest in greenhouse gas mitigation technologies. Setting: Mathematical derivation, using methods of linear programming, duality theory and sensitivity analysis. Methods: By employing a two-step evaluation approach, it allows to identify the factors determining the maximum price an individual investor would pay for such an investment, given the conditions of imperfect markets. Results: This price ceiling depends on the (corrected) net present values of the payments and on the interdependencies arising from changes in the optimal investment and production programmes. Although the well-established results of environmental economics usually can be confirmed for a single investment, increasing carbon taxes may entail sometimes contradictory and unexpected consequences for individual investments in greenhouse gas mitigation technologies and the resulting emissions. Under certain circumstances, they may discourage such investments and, when still undertaken, even lead to higher emissions. However, these results can be interpreted in an economically comprehensible manner. Conclusion: Under the usually given conditions of imperfect markets, the impact of a carbon tax regime on individual investment decisions to mitigate greenhouse gas emissions is not as straight forward as under the usually assumed, but unrealistically simplifying perfect market conditions. To avoid undesired and discouraging effects, policy makers cannot make solitary decisions, but have to take interdependencies on the addressee´s side into account. The individual investor´s price ceiling for such an investment in imperfect markets can be interpreted as a sum of (partially corrected) net present values, which themselves are a generalisation of the net present values known from perfect markets

Deep decarbonisation of the electricity sector is central to achieving the United Kingdom’s (UK) climate policy targets for 2050 and meeting its international commitments under the Paris Agreement. While the overall strategy for decarbonising the energy system has been well established in previous studies, there remain deep uncertainties around the total investment cost requirements for the power system. The future of the power system is of critical importance because low carbon electricity may create significant opportunities for emissions reduction in buildings and transport. A key policy application of quantitative analysis using models is to explore how much investment needs to be mobilised for the energy transition. However, past estimates of energy transition costs for the UK power sector have focused only on 2030 rather than 2050 and consider a relatively narrow range of uncertainties. This paper addresses this important research gap. The UK government's main whole system energy economy model is linked to a power system model that employs an advanced approach to uncertainty analysis, combining Monte Carlo simulation with Modelling-to-Generate Alternatives (MGA), producing 800 different scenario pathways. These pathways simultaneously consider uncertainties in policy, technology and costs. The results show that with No Climate Policy, installed generation capacities in 2050 are found in the range 60–75 GW, while under an 80% Reduction in GHG Emissions, between 100 GW and 130 GW of plant are required. Meeting climate targets for 2050 is also found to increase the investment requirements for new electricity generation. The interquartile range for cumulative investments in new generation under the No Climate Policy scenario ranges from £60bn to £75bn, while under an 80% Reduction in GHG Emissions, investment requirements approximately double to £110bn - £140bn. The exercise demonstrates the importance of uncertainty analysis to policy evaluation, yielding insights for future research practice both in the UK and internationally.

Purpose: This paper aims to extend and contribute to prior research on the association between company characteristics and choice of capital budgeting methods (CBMs). Design/methodology/approach: A multivariate regression analysis on questionnaire data from 2005 and 2008 is used to study which factors determine the choice of CBMs in Swedish listed companies. Findings: Our results supported hypotheses that Swedish listed companies have become more sophisticated over the years (or at least less unsophisticated) which indicates a closing of the theory-practice gap; that companies with greater leverage used payback more often; and that companies with stricter debt targets and less management ownership employed accounting rate of return more frequent. Moreover, larger companies used CBMs more often. Originality/value: The paper contributes to prior research within this field by being the first Swedish study to examine the association between use of CBMs and as many as twelve independent variables, including changes over time, by using multivariate regression analysis. The results are compared to a US and a continental European study. Open access

This paper evaluates the economic benefits to over-installing turbines on capacity-constrained wind farm sites in order to capture more energy at low wind speeds. Although this implies curtailment at high wind speeds, we show that over installing generation facilities can increase returns to investors and reduce system costs. A detailed model-based analysis is developed using British data, with variations in the range of over installation, the renewable policy support systems (fixed feed-in tariffs or green certificate premia to wholesale energy prices) and the extent of replacement of fossil generation in the technology mix with wind. In the cases of premia to market prices, we use agent-based, computational learning and risk simulation to model market prices. Not only is over installation beneficial under fixed feed-in tariffs, but is more so under premia to market prices and increasingly so as wind replaces fossil generation.

PurposeThe purpose of this paper is to develop a dynamic, stochastic, mechanistic simulation model of a dairy business to evaluate the cost and benefit streams coinciding with technology investments. The model was constructed to embody the biological and economical complexities of a dairy farm system within a partial budgeting framework. A primary objective was to establish a flexible, user‐friendly, farm‐specific, decision‐making tool for dairy producers or their advisers and technology manufacturers.Design/methodology/approachThe basic deterministic model was created in Microsoft Excel (Microsoft, Seattle, Washington). The @Risk add‐in (Palisade Corporation, Ithaca, New York) for Excel was employed to account for the stochastic nature of key variables within a Monte Carlo simulation. Net present value was the primary metric used to assess the economic profitability of investments. The model was composed of a series of modules, which synergistically provide the necessary inputs for profitability analysis. Estimates of biological relationships within the model were obtained from the literature in an attempt to represent an average or typical US dairy. Technology benefits were appraised from the resulting impact on disease incidence, disease impact, and reproductive performance. In this paper, the model structure and methodology were described in detail.FindingsExamples of the utility of examining the influence of stochastic input and output prices on the costs of culling, days open, and disease were examined. Each of these parameters was highly sensitive to stochastic prices and deterministic inputs.Originality/valueDecision support tools, such as this one, that are designed to investigate dairy business decisions may benefit dairy producers.

This paper exploits inter-temporal variations in employment protection across countries and finds that rigidities in labor markets are an important determinant of firms’ capital structure decisions. Over the 1985-2007 period, we find that reforms increasing employment protection are associated with a 187 basis point reduction in leverage. We interpret this finding to suggest that employment protection increases operating leverage, crowding out financial leverage. This result is robust across measures of employment protection and leverage, and does not appear to be due to pre-treatment differences between treated and control firms, omitted variables, unobserved changes in regional economic conditions, and reverse causality. Heterogeneous treatment effects are consistent with our economic intuition: we find that the negative effect is more pronounced in firms that are subject to frequent hiring and firing.

This dissertation is an aggregation of three major aspects of investment planning – cost projections, measurement of benefits and externalities, and risk quantification. In the first instance, the aim of the study was to assess the statistical significance of a common hypothesis that, cost and time overruns are particularly synonymous with hydropower dams. To demonstrate the magnitude and severity of overrun risks in hydropower planning, the study re-examines the cost issues associated with a portfolio of 58 dams that were financed by the World Bank from 1976 to 2005. Focusing on the technical parameters used in projecting the cost of these set of dams, there is sufficient evidence to show that errors in forecast follow a systematic pattern and cannot be solely attributed to randomness in input parameters such as inflation, exchange rate and demand forecasts. Following the empirical evidence in support of the hypothesis that cost overruns is a commonality among hydropower dams, it was also necessary to investigate the benefit side of dams in order to ascertain if the justification to build these projects are actually invalidated after incorporating the errors in forecast. Hence, the second aspect of this thesis was aimed at estimating the ex-ante and ex-post economic rate of return for the individual hydropower projects as well as for the aggregated portfolio of dams studied. Using the avoided cost methodology for measuring the benefits of a hydropower project, there is substantial evidence to support that the rents generated by these dams has been positive in spite of the common experience with overruns. The ex-post real economic rate of return for the entire portfolio is estimated to be greater than 14 percent. This findings implies that, decision making on building dams must consider iv adequate margins of ex-ante benefits over costs to account for the risks of cost overruns. Finally, the study provides a practical framework for addressing the issue of uncertainty in cost planning of hydropower dams. Using the reference class forecasting (RCF) technique, I construct a forecasting model that depicts what cost overruns can be expected (in probabilistic terms) for dams of different characteristics and locations. This technique is widely applied in the transportation sector, but here, I demonstrate how this methodology can be useful for improving the reliability of costs used for making decisions under uncertainty in power planning. The technique makes it possible to link contingency estimates closely to the likely incidence of uncertainty of construction costs for hydroelectric dams. A case study - the Bujagali dam in Uganda - is used to demonstrate how investment appraisal can be enhanced to better account for the risk of cost overruns. While the Bujagali project had suffered substantially from cost overruns, the expected net benefits of the dam are still expected to be adequate to cover for the actual cost of the dam. The conclusion is that if the dams were not built, the alternative source of generating power could have been more costly. Consequently, this study recommends the use of the RCF as a support tool for prescribing a margin for error, in the CBA deterministic estimates, to account for the risk of overruns before making a decision to build. Keywords: investment appraisal, hydropower, dams, cost overruns, reference class forecasting. Bu tez yatırım planlamanın üç temel konseptinin toplamından oluşmaktadır. Bu konseptler sırasıyla maliyet projeksiyonları, fayda ve dışsallıkların ölçülmesi, ve risk sayısallaştırılması şeklindedir. Ilk tahlilde bu çalışmanın amacı hidroelektrik santral barajlarının maliyet ve zaman aşımlarıyla eşdeğer oldugu hipotezini istatistiki anlamda kanıtlamaktır. Hidroelektrik santrallerinin taşma risklerinin büyüklük ve önemini gostermek amacıyla calışmada Dünya Bankası tarafından 1976 ile 2005 arasında finanse edilen 58 barajın maliyet sorunları analiz edilmiştir. Barajların kurulması ile ilgili teknik parametrelerin maliyetine bakıldığı zaman da tahminle ilgili hataların sistematik bir örüntü sergilediği net bir şekilde ortaya cıkmıştır. Ek olarak bu sistematik örüntüye sahip hataların enflasyon, döviz kuru ve talep tahminleri gibi girdi parametrelerinin rastgeleliğine isnat edilemeyeceği karşımıza çıkmaktadır. Maliyet fazlalıklarının hidroelektrik barajları ile ilgili olarak temel bir sorun olduğu hipotezinin ampirik bulgularla desteklenmesinin yanı sıra bu barajların ekonomik faydalarının da araştırılması bu projelerin hayata geçirilmesinin hatalarla birleşip geçersiz olup olmadığını gerekçelendirmek icin şart olarak karşımıza çıkmıştır. Bundan dolayı bu tezin ikinci amacı hidroelektrik barajlarının ex-ante ve ex-post ekonomik getiri oranlarını ölçmektir. Kaçınılmış maliyet methodolojisi kullanılarak hidroelektrik projelerinin faydaları ölçülmüş, sonuç olarak karşımıza bu projelerden elde edilen karların pozitif olduğuna dair önemli kanıtlar çıkmıştır. Ex-post reel ekonomik getirilerinin yüzde 14 ten fazla olduğu ispatlanmıştır. Bu bulgular, barajların yapılmasında karar üretirken ex-ante faydalarının maliyet aşımları risklerine karşılık yeterli düzeyde dikkate alınması gerektiğini ortaya koymuştur. vi Son olarak bu çalışma barajlarla ilgili maliyet planlamadaki belirsizliklere dikkati çekmek icin pratik bir çerçeve sunmaktadır. Referans sınıf tahmini tekniği kullanılarak bir tahminleme modeli oluşturulmuş, hidroelektrik santralleri ile alakalı olarak ne tür maliyet aşımlarının karşımıza çıkabileceği farklı konumlardaki ve farklı özelliklerdeki barajlar icin araştırılmıştır. Bu teknik daha çok ulaşım sektöründe kullanılmasına rağmen burada bu methodolojinin hidroelektrik santrallerinin santral kurulmasının belirsizlikleri altinda karar üretirken ne kadar faydalı olacağı ispatlanmıştır. Bu teknik aynı zamanda hidroelektrik santrallerinin kurulum maliyetlerinin belirsizliklerini olasılık ölçümleriyle birbirine bağlamak icin de kullanılabilen bir yöntemdir. Bir örnek çalışmadan – Uganda‘daki Bujagali barajı – yola çıkılarak yatırım danışmanlığının maliyet aşımlarının risklerini ortaya koymak için nasıl kullanılabileceği ortaya koyulmuştur. Bujagali projesi maliyet aşımlarından ciddi anlamda zarar etmesine rağmen, yapılan analizde, beklenen net faydaların barajın tüm maliyetlerini karşılayacak düzeyde olduğunu ortaya koymuştur. Sonuç olarak barajlar inşa edilmez ise elektrik akımı üretmenin alternatif yollarla gerçekleştirilmesinin daha da maliyetli olabileceği karşımıza çıkmaktadır. Neticede bu çalışma, RCF modelinin destekleyici bir method olarak kullanılmasını CBA belirleyici ölçümlerinde hata payının ortaya koyulabilmesi için önermektedir. Bu methodlar aracılığıyla maliyet ve zaman aşımı risklerinin proje üretmeye karar vermeden önce ortaya koyulabileceği de aşikardır. Anahtar Kelimeler: yatırım danışmanlığı, hidroelektrik, barajlar, maliyet aşımları, referans sınıf tahmin modeli. Doctor of Philosophy in Economics. Thesis (Ph.D.)--Eastern Mediterranean University, Faculty of Business and Economics, Dept. of Economics, 2015. Supervisor: Prof. Dr. Glenn P. Jenkins.

We suggest that the failure of investors to distinguish between an earnings component’s autocorrelation coefficient (unconditional persistence) and the marginal contribution of that component’s persistence to the persistence of earnings (conditional persistence) provides a partial explanation to the post-earnings-announcement drift, the post-revenue-announcement drift, and the accrual anomaly. When the conditional persistence of revenue surprises is high (low) relative to its unconditional persistence, both the post-earnings-announcement drift and the post-revenue-announcement drift are high (low), because investors’ under-reaction to revenues and earnings is stronger when the persistence of revenue surprises is more strongly associated with the persistence of earnings surprises. Also, the mispricing of accruals decreases substantially when the conditional persistence of accruals is high relative to its unconditional persistence, because investors’ over-reaction to accruals is mitigated when the persistence of accruals is indeed more strongly associated with the persistence of earnings. Our findings also suggest that financial analysts’ failure to distinguish between unconditional and conditional persistence of revenues and accruals results in more biased revenue and earnings predictions.

This paper was prepared for the purpose of presenting the methodology and uses of the Monte Carlo simulation technique as applied in the evaluation of investment projects to analyse and assess risk. The first part of the paper highlights the importance of risk analysis in investment appraisal. The second part presents the various stages in the application of the risk analysis process. The third part examines the interpretation of the results generated by a risk analysis application including investment decision criteria and various measures of risk based on the expected value concept. The final part draws some conclusions regarding the usefulness and limitations of risk analysis in investment appraisal.

This paper deals with the use of the CAPM for investment decisions and evaluations. Four different measures are deductively drawn from this model: the disequilibrium Net Present Value, the equilibrium Net Present Value, the disequilibrium Net Future Value, the equilibrium Net Future Value. It is shown that all of them may be used for accept-reject decisions, but only the equilibrium Net Present Value and the disequilibrium Net Future Value may be used for valuation, given that they enjoy the additivity property. The two nonadditive indexes cannot be deducted from the CAPM assumptions if the decision problem “invest/no invest” is reframed as “invest in Z/invest in Y”. Despite their additivity, the equilibrium Net Present Value and the disequilibrium Net Future Value are unreliable for both valuation and decision, because they do not signal arbitrage opportunities whenever there is some state of nature for which they are decreasing functions with respect to the end-of-period cash flow. In this case, the equilibrium value of a project is not the price it would have if it were traded in the security market. This result is the capital-budgeting counterpart of Dybvig and Ingersoll’s (1982) result.

For fruits, establishing intensive apple-orchards requires the highest amount of investment cost, while the returns depend on many factors. Based on farm and bibliography data we appraised an investment in a model in some variations that are the most used in practice (100% owner's capital and 55% owner's capital +45%o subsidies). The profitability of the investment has been analysed using the methods of NPV (Net Present Value) and DPP (Dynamic Payback Period). The essence of our analysis is a sensitivity analysis with the optimistic, pessimistic and realistic combinations of the yield and the market price. Plantation establishment financed by only own (corporate's) sources turns into profitable over 7-10 years in average and favourable cases, but the opposite is the case in unfavourable circumstances. By subsidy of 45% for investments, it is highly possible to return by the fifth or sixth year after the year of establishment, but it can return by the twelfth year even in unfavourable case.

PurposeUncertainty affects all aspects of the property market, but one area where the impact of uncertainty is particularly significant is within feasibility analyses. Any development is impacted by differences between market conditions at the conception of the project and the market realities at the time of completion. This paper sets out to address this issueDesign/methodology/approachThe feasibility study needs to address the possible outcomes based on an understanding of the current market. This requires the appraiser to forecast the most likely outcome relating to the sale price of the completed development, the construction costs and the timing of both. It also requires the appraiser to understand the impact of finance on the project.FindingsThis allows the appraiser to address the issues of uncertainty involved and thus provide the decision maker with a better understanding of the risk of development. This technique is then refined using a “two‐dimensional technique” to distinguish between “uncertainty” and “variability” and thus create a more robust model.Originality/valueThe feasibility study needs to address the possible outcomes based on an understanding of the current market. This requires the appraiser to forecast the most likely outcome relating to the sale price of the completed development, the construction costs and the timing of both. It also requires the appraiser to understand the impact of finance on the project.

Privatization has increased the number of players in the decision-making process for major transport investment decisions. The main argument of this paper is that this fragmentation is creating opportunities for strategic decision-making by each actor and that this is particularly obvious in the context of demand forecasting. This paper explores some of the specific causes and consequences of this new situation, including the perverse incentives, linked to the diversity of the objectives across the actors and to the risk allocation induced by the regulatory regime. It illustrates the issues and possible solutions from a wide range of modal and country experiences. In particular, it discusses the role of the newly independent sector regulators in reconciling these diverse goals and their limitations in view of the major information asymmetries problems they face. © 2002 Elsevier Science Ltd. All rights reserved.

The aim of this paper is to present a method and a tool based on cost-effectiveness analysis (CEA) for assessing energy efficiency improvements in buildings. The method is based on comparing costs of an energy efficiency improvement with its effects in terms of reduced energy use.Ashort review of the current practices in evaluating the economic efficiency and feasibility of energy efficiency measures is presented.A case example is presented with a calculationby using a CEA calculation method adapted for energy efficiency improvements in buildings.It is here concluded that the systematic appraisal of cost-effectiveness of energy efficiency investments would allow most economical projects to be implemented first, leading to greater overall economic efficiency.