Investment Evaluation Research Articles

The Effect of Entrepreneur Attributes on Investment Evaluations in Pitch Competitions

Investment in early-stage ventures entails significant risk and uncertainty; for this reason, most investment pitches do not result in investments. Whereas the literature in entrepreneurial financing indicates that investors rely on their gut feelings, it remains unclear which entrepreneur attributes factor into this type of intuitive judgment. This study presents a holistic model of entrepreneur attributes as they relate to inventors’ evaluation of funding potential. The model is divided into three categories: entrepreneur–investor relational attributes, entrepreneur motivational attributes, and venture performance-influence attributes. The model is then tested on real-time pitch competitions, by analysing data from technology start-up entrepreneurs, psychologist evaluators, and investors. The model is grounded in dual-processing theory and signalling theory. It is hypothesised that investors base their evaluations on their intuitive judgment of the entrepreneurs. Entrepreneurs’ competence, coachability, passion, preparedness, and leadership are shown to be associated with investors’ evaluations of funding potential.

Conventional Natural Gas Project Investment and Decision Making under Multiple Uncertainties

Similar to many energy projects, the evaluation of investments in natural gas projects is influenced by technical and economic uncertainties. These uncertainties include natural resource characteristics, production, decline laws, prices, taxes, benchmark yield, and so on. In China, conventional natural gas is still the dominant energy source. The investors are mainly large state-owned energy companies. Therefore, it is necessary to include the technical and economic uncertainties, as well as the investment decision and optimization problems of the enterprises in a unified analytical framework. To this end, this paper innovatively constructs such a framework. Using numerical simulations of approaches, the process of investment decision optimization by companies based on technology assessment and price forecasting is visualized in detail. The results suggest that the investment decision of the enterprise needs to consider technical and economic uncertainties in an integrated manner. It also needs to combine the business strategy and social responsibility of the enterprise in order to construct the objective function. With the availability of data, the framework and its algorithms can be used for practical evaluation of investment plans and decision supports for conventional natural gas projects. The framework can also integrate the analytical perspective of the macroeconomic and political environment to bring in a more comprehensive range of uncertainties.

Supporting social connection for people living with dementia: lessons from the findings of the TRIO study

PurposeThe purpose of this paper is to share the learning concerning how services and the paid carers working in them can support people living with dementia (PLWD) and their unpaid carers to overcome social isolation. This learning comes from the key findings from a Social Return on Investment (SROI) evaluation of a Shared Lives (SL) Day support service, known as TRIO.Design/methodology/approachSROI is a form of cost-benefit analysis that captures and monetises stakeholder outcomes. The SROI evaluation included a rapid evidence review, an interview study and a questionnaire study. The learning shared is drawn from the interview and questionnaire data that explored the reported outcomes relating to social connection, which included data related to participating in meaningful activities, confidence and independence.FindingsPLWD who accessed the SL Day support service experienced better social connection, a sense of control over their activities (including their social activities) and community presence. A key foundation of these outcomes was the meaningful relationship that developed between the PLWD, their unpaid carer and the paid carer.Research limitations/implicationsThis evaluation was a pilot study with a small, albeit representative sample size.Practical implicationsThe learning suggests feasible and effective ways for paid carers to support the social connection of PLWD and their unpaid carers with their wider community.Originality/valueThere has been little exploration of how community-based short breaks (like SL Day support) can enhance social connection. The authors drew on a social relational model lens to illustrate how this service type had supported successful outcomes of community and social inclusion for PLWD.

A Dual Probabilistic Discounting Approach to Assess Economic and Environmental Impacts

The growing environmental concerns require the characterization of decision support methods that can guide analysts towards more sustainable investment choices. Therefore, in the ex-ante economic evaluations of investments with environmental repercussions, it is of rising interest to give the “right” value to the non-monetary effects in the long term. In this regard, conventional discounting procedures—based on constant rates—are inadequate to evaluate intergenerational environmental effects. With this research we propose an innovative model for estimating discount rates to be used in the Cost–Benefit Analysis (CBA) of projects with long-term environmental effects. The model is based on a two-goods extension of the Ramsey formula, according to which the rate at which environmental impacts are discounted is different from the rate at which monetary benefits are discounted. Compared to the Ramsey model, we propose time-declining functions of the two discount rates to assess the long-run effects of investment projects. To characterize the model, we consider the macroeconomic risk, or we assume that the variable “GDP growth rate” is a stochastic variable. Furthermore, since we propose discount rates to evaluate public projects in line with sustainable development goals, we express environmental quality as a function of the Environmental Performance Index (EPI). Based on the proposed model, we estimate for the first time declining consumption discount rates and declining environmental discount rates for Italy based on empirical data. The estimates of the two discount rates for Italy shows that the environmental discount rate is lower than the consumption one: in fact, the first one starts from a value of 3.0% and arrives at 0.4% after 300 years; while the second one starts from 0.7% and reaches 0.3% at the end of the considered time horizon. The result highlights the importance of estimating country-specific dual and declining discount rates. These discount rates allow appropriate weights to be given to all investment impacts, and therefore also to environmental impacts, compared to conventional discounting.

The Establishment of Sharia-Based Class D General Hospital in Purwantoro Wonogiri

Purwantoro is a very strategic area, located in the middle of its surrounding subdistricts, and is a transit point to get to the surrounding sub-districts. In Wonogiri, there are nine general hospitals, but none are located in Purwantoro. The ratio of hospital beds per 1,000 population in Wonogiri is still 0.96. Indonesia is a country with the largest Muslim population (87.2%). The Muslim population of Wonogiri Regency reached 1,108,696 (97.65%), and specifically in Purwantoro, 99.06% are Muslims. So that awareness and need for sharia-based health services increased. This research is a feasibility study. Primary and secondary data obtained are collected and processed, then analyzed by the situation, demand, and needs, as well as financial analysis. Investment evaluation using the Investible Surplus Method (ISM). Situation analysis, both external and internal aspects, supports this project. Demand and needs analysis also have been fulfilled, but necessary to pay attention to the needs of male nurses. The total cost of the entire project excluding land purchases is Rp 42.231.739.375,00 through two-step constructions with an ISR of 16,81% in the ninth year. The establishment of a sharia-based class D general hospital in Purwantoro Wonogiri is feasible to be established with a capacity of 60 beds at an area of 4.252 m2, an investment value of Rp. 42.231.739.375,00 through two-step constructions with ISR of 16,81 % for nine years.

Risk evaluation and prevention of China’s investment in countries along the belt and road

The Belt and Road Initiative is a major Initiative proposed by Chinese President Xi Jinping in 2013. Research on the risk prevention and control of China’s financial investment in countries along the Belt and Road has become a very hot topic in the world. This research focuses on the risk evaluation methods and prevention and control countermeasures of China’s foreign investment under the Belt and Road Initiative. First, based on the analysis of the existing studies on economic investment evaluation, an intuitionistic fuzzy multi-attribute evaluation method based on entropy method and G1 method is proposed. The essence of the proposed method is to combine the intuitionistic fuzzy set theory with subjective and objective evaluation methods, which improves the disadvantage of the original evaluation method taking too much subjective factors into consideration. This study applies the proposed method to the economic risk evaluation of China’s outward foreign direct investment (OFDI), constructs a 17-indicator economic risk system, and uses this method to rank the importance of the 17 indicators. The more important contribution is that this paper not only achieves improvements at the theoretical level and innovation at the practical level, but also condenses the research conclusions into three pieces of countermeasures and suggestions on China’s investment in countries along the Belt and Road. This research can provide theoretical support for Chinese government to make financial investment decisions in countries along the Belt and Road, and can also help countries along the Belt and Road to actively integrate into the Belt and Road Initiative, and promote the high-quality social and economic development of the countries along the Belt and Road.

Moral luck in investment contexts: We consciously find unprofitable investments less moral.

Moral luck refers to whether an actor is morally praised or blamed for an action whose outcome they could not influence. In two studies, we investigated the behavioral importance of this phenomenon in the realm of investments, which has become increasingly subject to ethical evaluations. In our first online experiment, we examined whether people's moral evaluation of an investment decision depended on its arbitrary outcome and whether their interpretation of the nature of the decision was driven by this outcome. Our results showed that profitable investments were considered more moral than unprofitable investments. Moreover, profitable investments were labeled "investments" instead of "speculation" or "gambling" more often than unprofitable ones. In our second study, we asked the subjects to assess investments independent of the outcome. After the outcome was announced, the subjects were given the opportunity to reflect and change their initial decision. The results show that people change the moral evaluation and label of investments when told that it had a bad outcome. This observation was stable across different investment contexts. These findings suggest that we must be careful with the increasing moralization of investment decisions and be sensitive to our cognitive biases.

Real Options and their application in renewable energy projects. State-of-the-art review

The use of renewable energy sources, such as wind, solar, among others, has been growing, especially in recent years. The main objective of this study was to conduct a literature review on the real options approach for assessing the feasibility of investing in energy production and its derivatives. Thirty publications on the mentioned topic were analyzed using the Mendeley Reference Manager bibliographic software and categorized into seven groups according to their purpose: 1) Evaluation of renewable energy projects or investments, 2) Evaluation of non-renewable energy projects or investments, 3) Evaluation of energy auctions, portfolios, and investments in the energy market, 4) Evaluation of renewable energy technologies, 5) Evaluation of the impact of regulatory policies on renewable energy projects, 6) Evaluation of the transition to renewable energy generation, and 7) Evaluation of the design, size, and location of wind farms. Nine types of options were identified: 1) Waiting, 2) Delaying, 3) Anticipating, 4) Expanding, 5) Exercising, 6) Rejecting, 7) Abandoning, 8) Expanding, and 9) Switching. Additionally, the techniques and models applied to evaluate the options and simulate the twenty-nine uncertainties, grouped into eight categories, considered in the research were examined. In the future, there is a need to increase studies using the real options approach to evaluate renewable energy projects under uncertainties, applying new evaluation techniques that allow for the valuation and establishment of flexible strategies.

Research on Optimization of Construction Project Investment Evaluation Based on Big Data

The evaluation and optimization of construction project investment is ultimately to evaluate the risks and benefits of the project, and the evaluation indicators and standards must take into account China's economy and enterprises. The risk factors that affect the investment projects of construction projects come from various aspects. The cost of the project depends on the implementation process and investigation methods in the project operation. In this paper, the optimization research of construction project investment evaluation based on big data is carried out. This paper introduces a risk assessment method based on BPNN (Back propagation neural network). We normalized the attribute values of various indicators used for project risk assessment, and sent them as input samples from the input layer. After being processed layer by layer by hidden layers, they were transmitted to the output layer, and finally the output of the system was taken as the evaluation target. The author verified it with an example, which shows that it is feasible to use BPNN to evaluate and optimize the construction project investment.

An Empirical Study on the Coupling and Coordination of Health Investment, Resident Health and Economic Growth in Sichuan Province —Based on a Modified Coupling Model

We should calculate the coupling degree of medical investment, resident health and economic growth in Sichuan Province, and make clear the coordinated development of the aforementioned three factors. In that, the government was able to formulate policies that feature the positive interaction and coordinated development of regional medical investment, health and economy. Methods on index system for the evaluation of health investment, resident health and economic growth were constructed, and the coupling and coordination degree of the three systems were empirically studied based on the entropy weight method, the coupling coordination model and the gray correlation method. From the perspective of time series, the overall coupling and coordination level of Sichuan Province is relatively low, and the comprehensive development level of health investment and economic growth system has lagged behind the resident health system; from the perspective of spatial distribution characteristics, in 2019, the coordinated development level of health investment resident health and economic growth coupling in western Sichuan, southern Sichuan, northern Sichuan, eastern Sichuan and northern Sichuan is in the primary coordination stage, but there is a lag in the development of the health investment system between western Sichuan and southern Sichuan, and there is a lag in the development of the economic growth system between northern Sichuan and eastern Sichuan. From the analysis of gray correlation degree, the main correlation factors are diverse. All in all, the overall coordination level of health investment, resident health and economic growth in Sichuan Province is relatively low, and in order to achieve its coordinated development, it is necessary to narrow regional differences, formulate coordinated development strategies according to local conditions, and improve the overall coordination level.

A bibliometric evaluation of financial literacy and investment: a three-decade study based on the Scopus database, current research trends, and future directions

A bibliometric evaluation of financial literacy and investment: a three-decade study based on the Scopus database, current research trends, and future directions

Development of accounting and analytical support for the evaluation of investments in innovations by industrial enterprises

Introduction. New technological and economic challenges of our time demandindustrial enterprises to apply innovative approaches to the organization of production and management, therefore, investments in innovation are becoming one of the trends of sustainable development. Informed investmentdecisions require information and methodological tools, including accountingand analytical support. The purpose of the work is to consider the current state and directions of development of accounting and analytical support for the evaluation of investments in innovations by domestic industrial enterprises. Materials and methods. The paper analyzes approaches to the definition of accounting and analytical support; the author proposes their interpretation of the definition. The regulatory framework governing the accounting of investments in innovative development, the objects of which are R&D and intangible assets, as well as regulatory and author’s approaches to assessing the investment efficiency of projects are reviewed. Results. New federal accounting standards are compared and critically analyzed; a numberof recommendations on the application of the standards were proposed. Classical methods of investment evaluation are revealed; their advantages and weaknesses are identified. The development trends for the evaluation methods applied to the investments in innovations, proposed by modern researchers, and based on the decision tree, fuzzy set theory, multi-criteria approach, etc. are reviewed, and their advantages and disadvantages are described. Conclusion. The application is justified; the methodology derivedfrom the growth of the company’s value and applied to evaluate the innovationinvestment efficiency for the innovations is described and illustrated, since it reflects the ability of the enterprise to generate and multiply profits. The results of the work can be used by the scientific community to develop further directions for the development of accounting for investments in innovation and investment analysis, as well as by business entities to generateaccounting policies and accounting systems, as well as to assess the effectivenessof investments in innovation in order to ensure economic security and sustainable development.

Ocena efikasnosti investicije u proširenje kapaciteta preduzeća iz gumarske industrije

The aim of this paper is to determine and evaluate the economic efficiency of investment of the company from the field of rubber industry in the injection molding press and tool, with which the company expands the capacities intended for the production of rubber seals. The effects of the investment were estimated using the payback period, as a static method of investment efficiency evaluation, as well as the net present value and profitability index, as dynamic methods. In addition, in paper was used sensitivity analysis, as a method for evaluation of investment in conditions of uncertainty. The obtained results showed that the payback period of the investment is 2.93 years, while the net present value of the investment is 149,914 euros, and the profitability index is 1.79. All the obtained results indicate that the investment should be implemented. In addition, the sensitivity analysis, whose focus was primarily to consider the impact of increased material costs, on the results of the investment evaluation methods used, showed that the project is acceptable in all considered cases, because it contributes to increasing value of the company.

Research on Investment Economic Evaluation of Flexible Regulating Resources such as Energy Storage in High Proportion New Energy Environment

With a high percentage of new energy scenarios, it has become a trend for flexible resources such as energy storage systems to participate in long-term planning. In this context, it is important to explore how energy storage systems are configured. Therefore, it is necessary to analyse the economics of energy storage and other resources to ensure that investments in energy storage and other resources are economically valuable under different future models. This paper firstly analyses the current situation of a high percentage of new energy in China, and secondly constructs a model for analysing the economics of flexible regulation resources such as energy storage. Under partial data based on the scenery storage project, the economic analysis under four models is derived, including cost and benefit analysis, investment benefit analysis, and break-even point analysis. Finally, the economic evaluation of investment in energy storage projects under different models is summarized based on the calculation results.It is concluded that different scenario models have different economic benefits, and the operation capacity of the four scenarios is higher than that of the existing models.

ІНВЕСТУВАННЯ ІНТЕЛЕКТУАЛЬНОГО КАПІТАЛУ В ІННОВАЦІЙНИЙ РОЗВИТОК ПІДПРИЄМСТВА

The article deals with current issues of intellectual capital investment in enterprise development, management practices and performance evaluation of investment of intellectual capital. The concept apparatus of the category "intellectual capital" is analyzed. Appointed to understand the holdings as tangible and intangible resources, which cannot be liquidity and formal registration of power. It is suggested to look at the structure of the intellectual capital of business in terms of specific elements, among them: human assets, market assets and assets, as well as structural assets and assets. In the following, a scheme for the formation and investment of intellectual capital of business is presented. It is proposed to attribute the efficiency of investment to intellectual capital in terms of commercialization of created innovative products, or additional income, taken away by the company after the implementation of projects for a variety of developments. The article defines that the effectiveness of intellectual capital investments cannot be considered only from the point of view of the obtained financial return due to the heterogeneity of its structure, therefore, an additional set of criteria for evaluating the effectiveness of intellectual capital management of the enterprise is highlighted, since the level of effectiveness of intellectual capital management will definitely affect the quality of innovative development of the enterprise. The author proposed to include the following as such criteria: criteria of financial security of the cycle of reproduction of intellectual potential with its subsequent transformation into intellectual capital, such criteria will allow to determine the degree of participation of the company's financial resources in the reproduction of intellectual potential; criteria for the quality of reproduction of the fixed capital, which allow to determine the level of technical and technological reproduction of the fixed capital; production sustainability criteria determined by the level of available innovation opportunities; criteria of socio-economic growth of the enterprise.

Strategic investment evaluation

We study the interaction of incentives to free‐ride on information acquisition and strategically delay irreversible investment in environments in which multiple firms evaluate an investment opportunity. In our model, two firms decide how quickly to privately obtain information about the profitability of a project and when (if ever) to publicly invest in it. Multiple equilibria exist, differing with respect to how much information firms acquire as well as how quickly they invest. The equilibrium that maximizes aggregate payoffs features asymmetric play with distinct leader and follower roles when firms are patient, but features symmetric play when firms are impatient and information acquisition costs are sufficiently high.

Evaluation of Power Grid Investment Decision-Making with Mixed Binomial Coefficient and Coefficient of Variation

The investment evaluation of power grid construction projects is a necessary link for power grid companies to carry out power grid construction. In the traditional evaluation process, it is generally based on the original index scores or similar schemes for comparison and decision-making. There are problems of simple methods and insufficient theoretical support. Fully considering various factors in the investment process of power grid construction, a set of rating index system with three-level hierarchical structure is constructed with actual demand as the standard. The evaluation model is verified and analyzed by an example.

Caribbean Metaverse Development: A Literature Review Perspective

The Caribbean’s metaverse evolution accelerated due to the Covid-19 pandemic. This paper focuses on the metaverse, XR, and NFT and emphasises the Caribbean’s contribution to the virtual environment. A bibliometric analysis of metaverse-themed research identified the rapid increase in publications in 2021 and 2022 and that titles with XR (AR, VR or MR) occurred three times more than blockchain (including NFT). An evolving dataset was created based on a continuous scoping literature review of Industry 4.0 and its enabling technologies. This enables the creation of a new definition of the metaverse, understanding the UX benefits of XR and its applications' areas of foci, highlighting investment in XR-based projects, and illustrating the Caribbean-themed NFT and XR projects. This dataset revealed that UX benefits are linked to XR element features that are relevant, contextual, customised, hands-free and intuitive. It also revealed that XR applications have areas of foci that can enable machine control or data interface, designing and testing, remote support, education, customer engagement, remote collaboration or entertainment and escapism. Analysis of 54 XR papers revealed that the most popular area of focus was education (including training, learning and understanding). An evaluation of global investments in XR development showed funding ranged from USD 70K to USD 100M, and there needs to be focused financial support for Caribbean projects. This justifies continued research into factors influencing funding and encouraging Caribbean XR development. In addition, this research promotes regionally developed XR projects and NFTs. The paper's originality is the reductionist definition of the metaverse: a space designed for users by users, which can satisfy whomever, whatever, however, wherever and whenever. It manifests the user's extended reality, facilitated through XR technologies that enable Industry 4.0 (I4.0). As such, the metaverse can be considered the practical implementation of I4.0.

Performance evaluation of investment with DEA models under pure jump processes

SummaryPortfolio optimization is a selection of the best combination of financial assets that maximizes the return and minimizes the risk. As the stock return distributions exhibit skewness, kurtosis, and heavy‐tailedness, for asset performance evaluation through the data envelopment analysis (DEA), we assume that the asset returns follow a pure jump Lévy process. For this purpose, two risk measures are provided as value‐at‐risk (VaR) and conditional VaR (CVaR). To deal with negative values, the range directional measure (RDM) model is utilized in the appropriate Lévy process, and inefficiency measurements are compared. Moreover, the asset price jumps have significant effects on the input and output of DEA models, risk measures, mean returns, and efficiency scores. In this regard, there are two optimization problems integrating DEA based on the variance gamma (VG) Lévy process, in which the input and output are stochastic. One of these two problems is a multi‐objective optimization model that evaluates more reliable efficiency scores than the other models. For this purpose, the VG parameters are estimated through the moments estimation method in order to analyze seven companies listed in the Tehran stock exchange (TSE). Finally, the Kolmogorov–Smirnov goodness‐of‐fit test is conducted. The results indicate that the VG model fits properly and is well suited to assets returns.

Применение цифровых технологий для инвестиционной оценки горнорудных проектов западной части Арк­тики

The authors consider the mining-geological and technical-economic conditions of promising ore deposits in the Western part of the Arctic of the Russian Federation and analyze the existing methods for evaluating investment projects. They have revealed that the methods do not take into account the intensive introduction of digital technologies, automation and robotization of machines and equipment into the mining industry. The authors substantiate the necessity of using digital technologies in the investment appraisal of mining projects. The study objective is the developing of an improved method for investment appraisal in the Western Arctic mining projects. The authors suggest a methodical approach based on parametric and scenario modeling, which allows minimizing the influence of uncertainty factors and increasing the efficiency of decision-making. Thus, for the practical implementation of the approach in the investment appraisal of mining projects, taking into account digital technologies, they propose an algorithm that includes six effective steps. A distinctive feature of the approach is the use of methods for modeling mining equipment objects. The mining and geological information system MINEFRAME, created at the Mining Institute of the KSC RAS, has the necessary functionality. An investment appraisal of 13 promising deposits as mining projects is completed. The authors select nine (9) deposits that best meet the criteria of economic feasibility. Types of ore minerals: titanium, rare earth elements, lithium, vanadium group the selected deposits and ranked according to investment evaluation indicators. The authors propose economically justified and effective scenarios for involving investment-attractive deposits in the economic turnover. Both the integration of mining projects into closely located mining enterprises and their autonomous development are envisaged.