Investment Framework Research Articles

Innovation and investment framework for the development of competitive fisheries and aquaculture

The purpose of the article it consists in the substantiation of innovation and investment principles of competitive development of fisheries and aquaculture in order to effectively conduct business in modern economic conditions and to comply with technological parameters of production, introduce innovations in production, and economical attitude to fish and water resources. Methodology research consists in using a combination of methods: economic-statistical, monographic, systemic, economic-mathematical, abstract-logical and others. The scientific novelty the re- sults obtained include the introduction of innovative, economically viable and competitive production technologies based on a scientific approach to organizing an aquaculture business, namely the ability to quickly and efficiently respond to external challenges, find a way out of a critical situation and correctly adjust production plans in accordance with changes in market conditions. Conclusions. Substantially modern principles of the effective functioning of fisheries in order to ensure competitive activity. Regulatory tools are proposed to ensure the profitability of the aquaculture business, which include attracting in- vestments for the acquisition of capital goods, training specialists and constantly improving their skills, and ensuring efficient fisheries production in an innovative economy.

Optimal Timing of Onshore Wind Repowering in Germany under Policy Regime Changes: A Real Options Analysis

In this paper, we investigate capacity expansion, the technological development of wind turbine generators, and the merits of onshore wind repowering in Germany. We analyze the regulatory framework that is presently in place and its impact on the profitability of the onshore wind parks commissioned under previous regulatory frameworks. The optimal timing of repowering under today’s market premium model is scrutinized. Repowering in a market without subsidies for onshore wind energy is also evaluated. In the two cases (regimes) investigated, the electricity price is modeled stochastically as a geometric Brownian motion process. More specifically, using a real options modeling framework for investments under a free market regime, we analyze how the regime change affects the optimal timing of repowering. Further, we check the results for their robustness via a sensitivity analysis for both analyzed regimes. We find that repowering well before the plant’s expected end of life (‘early repowering’) can be economically preferable under the German Renewable Energy Sources Act 2017 remuneration scheme and that, due to the electricity spot market price development, repowering under the market premium regime is more profitable than it is under the free market regime. The economic viability is strongly influenced by the duration of the initial tariff granted to the old installation, the expected digression factor of the future reference tariff, and the increase in electricity generation achieved through repowering.

Utilising the Social Return on Investment (SROI) Framework to Gauge Social Value in the Fast Forward Program

A market paradigm shift towards a ‘knowledge-based economy’ means Australia is moving towards a major skills crisis whereby the workface will lack skills attainable from higher education. Moreover, those from low socio-economic backgrounds, and who are confronted with disadvantage, still face challenges in gaining entry to university. The Fast Forward Program (FFP) aims to increase attainment of higher education for X high school students in years 9–12, with a focus on dismantling the social barriers preventing attainment. To achieve this aim, the program hosts a range of student and parent in-school workshops and on-campus visits. To capture the social impact of the program for all participants, the social return on investment (SROI) methodology was implemented. The SROI ratio is represented as a return in dollar value for every dollar invested; due to the success of the program, the investment represented $5.73 for every $1 spent. The key findings indicated that students and parents gained a deeper familiarity and understanding of university which, in turn, created a deeper confidence and motivation for students to enter higher education. Additionally, participants reported being able to better use their time to cater for study, and were more comfortable about going onto a university campus.

Legal perspectives on the protection of bilateral investment between China and Switzerland

ABSTRACTGiven the rapid increase of bilateral investments between China and Switzerland over the last decade, the legal framework applicable to foreign investment has become more and more sophisticated reflecting the various interests regarding foreign investment. These interests do not only include the protection and promotion of foreign investment in order to facilitate economic growth, but also the safeguard of the effective functioning of the markets as well as the protection of national security from undue influence by foreign actors. In light of this, this paper takes a comparative law perspective on the applicable legal framework for foreign investment flowing from China to Switzerland and vice versa. By doing so, it focuses on the rights of investors under the bilateral investment treaty concluded between the two countries as well as on two ex ante review mechanisms screening transactions involving foreign investment, this being merger control and national security review. Finally, it analyzes the possibilities of Chinese investors to enter the European Union market through investments made in Switzerland and draws lessons from the Swiss experience for a future bilateral investment agreement between China and the European Union. The paper finds that, with the exclusion of ‘letter-box’ companies, Chinese and Swiss investors can benefit from a high degree of protection provided in the bilateral investment treaty between the two countries, which can be enforced through investor-state arbitration. The merger review processes in the two countries are largely comparable, except for the fact that the Chinese merger review can potentially be based on non-competition factors. Regarding the safeguard of national security, the two countries adopt very different approaches. While China provides for a review mechanism for individual transactions, Switzerland has conducted a general risk assessment screening all potential transactions in the foreseeable future. The two approaches fit the respective circumstances of the two countries. With respect to access to the European Union market, Chinese investors in Switzerland can expect favorable conditions only regarding very specific sectors, this being civil aviation and insurance. In view of negotiations of a future bilateral investment agreement with the European Union, China could notably consider extending most-favored nation treatment to European Union investors with respect to market access.

MANAGING THE GAP BETWEEN ACTUAL AND TARGET CAPITAL STRUCTURE: AN EVIDENCE FROM PAKISTAN

Investment framework is one of the most significant components that impact the company’s value. Reliable funding choices for a company generally lead to a capital structure that increases the firm’s value (Abor, 2006). Early studies provide contradictory reviews about a company’s capital structure decisions. This paper investigates the partial adjustment model for a company’s target capital structure. The study also explores how companies operating in different sectors of Pakistani market adjust towards the target capital structure levels. The study also recognizes that an unanticipated share price change also have an effect on the target capital structure. The results indicate that companies do have target leverage and that their adjustment speed varies from sector to sector of the Pakistani market. A typical sector closes more than 50% of the gap between its actual and its target debt ratios within one year.

The development and initial performance analysis of REITs in Ireland

PurposeThe inception of REITs in Ireland in 2013 presented an additional property investment opportunity to Ireland’s commercial property investment landscape. Importantly, the Irish REIT market is an institutional apparatus with an objective to rejuvenate Ireland’s commercial property market. The purpose of this paper is to provide an empirical validation of the performance of Irish REITs over the period March 2015 to February 2019 across several investment measures such as risk-adjusted returns and diversification benefits.Design/methodology/approachUsing monthly total returns in local currency, the risk-adjusted performance and portfolio diversification attributes of Irish REITs are assessed. The mean-variance framework is utilised to assess the potential added-value benefits of Irish REITs in a mixed-asset portfolio.FindingsIrish REITs delivered the strongest average annual return performance, lower relative volatility vs the stock market and competitive overall risk-adjusted performance. The results affirm the characteristic of Irish REITs as a total return-focussed income-driven property investment asset class. The optimal asset allocation analysis shows that Irish REITs are an important ingredient in a mixed-asset investment framework, as their allocation could be scaled effectively across the portfolio risk-return spectrum.Practical implicationsIrish REITs are an emerging investment opportunity for investors seeking exposure in the strongly performing property market in Ireland in the post-Global Financial Crisis period. They are also regarded as an effective alternative conduit to private investment routes (i.e. direct property and non-listed property funds), with the added advantage of being more liquid and versatile than their private property investment counterparts. Importantly, Irish REITs fulfilled the purpose for which they were originally designed. The promising initial performance observed in this paper gives a useful context to what the future might hold for Irish REITs, given the strong interest for commercial property assets in Ireland from both local and cross-border property investors.Originality/valueThis paper is the first empirical research aimed at providing an initial empirical performance validation of Irish REITs as an effective route to commercial property exposure in Ireland. This research enables empirically validated, more informed and practical property investment decision making regarding the strategic role of Irish REITs in a portfolio.

Deeply uncertain pathways: Integrated multi-city regional water supply infrastructure investment and portfolio management

This study contributes the Deep Uncertainty (DU) Pathways framework for bridging long-term water supply infrastructure investments and improved short-term water portfolio management (e.g., restrictions, water transfers, financial instruments, etc.) to yield a regional water supply policy robust to supply and financial failures. The DU Pathways framework combines flexibility-providing risk-of-failure (ROF) decision rules, dynamic adaptive policy pathways concepts, and a careful consideration of time-evolving information feedbacks to yield management-conditioned infrastructure pathways for regions. The DU Pathways’ framework has been developed to carefully consider multi-actor regional contexts with the goal of aiding stakeholders in discovering pathway policies that attain high performance levels for supply reliability and financial stability across challenging, deeply uncertain futures and to guide robustness compromises that may be necessary between regional actors. As demonstrated in the Research Triangle region of North Carolina, DU Pathways clarifies how to identify robust infrastructure investment and management policies across the municipalities of Raleigh, Durham, Cary, and Chapel Hill. Our results provide insights about the most cost-effective infrastructure options to be pursued in the near-term, clarify which sources of uncertainty drive the performance tradeoffs and robustness conflicts across the regional system, and demonstrate valuable information on the diversity of interdependent failure modes that may emerge across the multiple actors implementing each candidate policy.

Universal Ownership in the Anthropocene

This paper reviews the existing literature on Universal Ownership Theory and expands on it to encompass a theoretical and practical framework for Universal Owners in the Anthropocene era. This extension of the theory is necessary because of the scale and urgency of the climate crisis, on one hand, and the expansion of the category of funds considered to be Universal Owners on the other – through the rise of fiduciary capitalism and the increase in institutional ownership, and through the increasing prevalence of passive investing. This paper incorporates several novel elements into Universal Ownership Theory: an Existential Risk lens, which highlights the portfolio risk of civilisational collapse; a theoretical framework that reflects advances in behavioural science; a practical investment framework based on the tenets of Positive Investment, including asset class-specific recommendations with a focus on capital allocation, the primary-to-secondary market transition, and “ungameable” metrics; and the proposition of a “duty of expansion” for Universal Owners to extend participation to communities and regions of the world currently underrepresented among the body of large institutional investors.

Responsible Investment and Its Impact on Investment Decisions: Zimbabwe Scenario

Following calls by social, environmental, and corporate governance advocacy groups on the need for investors to take environmental, social, and governance (ESG) factors into consideration when making investment decisions, this research looks at responsible investment and its impact on investor decision-making. Using a Likert scale structured questionnaire, data are gathered on the key factors considered when making investment decisions and on the extent to which the inclusion of ESG variables may influence investment decisions. Using a Statistical Package for the Social Sciences (SPSS) correlation analysis, together with linear and ordinal regression analysis, the findings reveal that there is no significant relationship between ESG factors and investment decisions. It is therefore recommended that third parties—private institutions such as nongovernmental organizations—should intervene through policy recommendations, awareness campaigns, and advocacy to ensure that individual investors and entities do consider ESG factors in their investment decision-making and processes. It is also recommended that firms should disclose the extent to which they factor ESG issues into their investment decision-making. <b>TOPICS:</b>Portfolio theory, portfolio construction, ESG investing <b>Key Findings</b> • In Zimbabwe, ESG factors have no significant influence on the investor’s decision to invest. • The currently prevailing statutory frameworks, in Zimbabwe, do not suffice to make an investment responsible. • Private institutions, policymakers, and investors should work together to shape the investment framework and close the significant gap between investor interests and knowledge about responsible investment.

The Great Divorce Between Investment and Profitability

Using data over the last century, we show that the cross-sectional relation between investment and profitability among U.S. public firms is positive in the first half-century but negative in the recent four decades. The negative fundamental relation explains the high level and the positive correlation of investment and profitability premiums after 1980. In out-of-sample environments including the pre-1980 U.S. stock market where investment and profitability premiums are low and insignificant, the fundamental relation is positive. Given the time-varying investment-profitability correlation, both the in and out-of-sample behaviors of investment and profitability premiums are consistent with the neoclassical investment framework.

Innovative strategies for the elimination of viral hepatitis at a national level: A country case series.

Viral hepatitis is a leading cause of morbidity and mortality worldwide, but has long been neglected by national and international policymakers. Recent modelling studies suggest that investing in the global elimination of viral hepatitis is feasible and cost‐effective. In 2016, all 194 member states of the World Health Organization endorsed the goal to eliminate viral hepatitis as a public health threat by 2030, but complex systemic and social realities hamper implementation efforts. This paper presents eight case studies from a diverse range of countries that have invested in responses to viral hepatitis and adopted innovative approaches to tackle their respective epidemics. Based on an investment framework developed to build a global investment case for the elimination of viral hepatitis by 2030, national activities and key enablers are highlighted that showcase the feasibility and impact of concerted hepatitis responses across a range of settings, with different levels of available resources and infrastructural development. These case studies demonstrate the utility of taking a multipronged, public health approach to: (a) evidence‐gathering and planning; (b) implementation; and (c) integration of viral hepatitis services into the Agenda for Sustainable Development. They provide models for planning, investment and implementation strategies for other countries facing similar challenges and resource constraints.

Alien plant invasion in the Indian Himalayan Region: state of knowledge and research priorities

Invasion by alien species is a global problem and forms one of the major drivers of global change. The researches on plant invasion have grown rapidly across the globe since the mid-twentieth century. However, in the Indian Himalayan Region (IHR) such studies are inadequate and have not been systematically conducted. Lack of empirical evidences on various described aspects of plant invasion in IHR are likely to aggravate the issue of invasion management in the region. This scenario would become more worst under changing climate. This study analyzed the results of an extensive review of the available information generated through Web of Science and Google scholar. A total of 297 naturalized alien plant species belongs to 65 families in the IHR are reported. Of the total 297 naturalized alien plant species in IHR, maximum species occur in Himachal Pradesh (232; 78.1%) followed by Jammu & Kashmir (192; 64.6%) and Uttarakhand (181; 60.90%). Among various invasive species, Lantana camara, Ageratina adenophora, Parthenium hysterophorus and Ageratum conyzoides have been reported from most of the IHR states and proliferated over larger area. Evidences available in the published studies are indicative that with tourism promotion and increasing roads networks, that passes through forests, many of the alien species in the IHR have started invading forests and even in alpine ecosystems. This study observed expansion of Ageratina adenophora up to 2900 m, which is higher than its reported elevation range (300–2800 m) in west Himalaya. These evidences suggest possible encroachment by alien species in hitherto invasion resilient higher Himalaya, particularly with emerging trends of increasing temperature and human disturbances. The present study also provides a multistage framework for investment on invasion researches in IHR. This will allow developing appropriate management strategies and policy planning for addressing issues pertaining to plant invasions across the IHR states.

An integrated AHP‐TOPSIS framework for foreign direct investment in Turkey

AbstractForeign direct investment (FDI) is seen as an essential part of development due to the contribution of the host country. Profits of FDI such as technology transfers, spillover benefits, and increasing competition have encouraged both of domestic firms and policymakers to attracting FDI. In the course of making investment decisions, foreign investors prefer countries that follow stable economic policies, achieve a certain level of development of financial structure, and have legal regulations that favour foreign capital. Turkey, one of the emerging market economies, met the challenges including but not limited to high inflation, diminishing growth rates, and currency depreciation. Even with its ongoing currency crisis, Turkey continues to remain a top pick for investors. From this point of view, this paper investigates the selection of the most suitable sector by taking into consideration the economic, political, and country factors for foreign investors. The proposed methodology for sector selection contains three stages. The criteria for FDI are defined from the current literature, and we narrow it down according to the opinions of the decision‐making group. After that, the analytic hierarchy process method used to obtain the priority order of the criteria. Finally, we use the Technique for Order of Preference by Similarity to Ideal Solution method to rank the sectors in accordance with the evaluation criteria. Additionally, we perform a sensitivity analysis to observe the effects of possible changes in the weights of the criteria. We designate three prime criteria, which are political, economic, and country. The results indicate that political criterion have the highest weight and based on the results of stages, manufacturing sector is obtained as primer election industry.

DNPV: a valuation methodology for infrastructure and Capital investments consistent with prospect theory

Traditional valuation methods such as net present value (NPV) utilize increased discount rates to account for risk, in the process introducing a time bias effect that promotes short-termism. Application of NPV often discourages much needed infrastructure projects that require large capital investments yet are slow to generate positive cashflows. NPV also downplays the significance of future liabilities and can lead to risk misallocation amongst investment partners and stakeholders. The decoupled net present value (DNPV) method introduces the risk-as-a-cost concept that prices the risk of obtaining lower-than-expected cashflows and thus represents investors’ compensation for bearing such risks. Capturing the loss-aversion attitudes described by prospect theory, DNPV provides a transparent and consistent valuation framework for long-term investments by: (i) calculating expected values of cashflow components using their probability characterizations, (ii) defining the cost of risk (market and non-market) as the expected downside value, (iii) subtracting/adding the cost of risk from/to expected revenues/expenditures, and (iv) discounting the results using risk-free rates. DNPV’s power is illustrated by re-analyzing a 42-year toll-road concession initially evaluated using NPV and real options. The case study shows how explicit risk quantifications could be used to better structure the concession and reallocate risks among stakeholders.

Stock Market Integration among Asian Economies in a Case of India, China and Japan

Globalization has opened the door for global investors to avoid the saturation of investment opportunities in the domestic market. Latest technological advancement, accessibility to financial and global information, liberalization and globalization put the global market into a new investment framework. The present paper aims to examine the level of cointegration between three big Asian economic powers India, China and Japan. Twenty-years data has been analyzed by applying Johansen Cointegration, Vector Error Correction Model, and other econometric statistical tests in E-Views. The findings suggest a long-run relationship between India (BSE) and Japan Stock indices (Nikkie), but no such integration find of these two stock indices with China Stock Exchange (Shanghai). Keywords : Asian Economies, Stock Indices, VECM, Johansen Cointegration Test, E-Views *University Business School, Maharaja Ranjit Singh Punjab Technical University, Dabwali Rd, Lal Singh Nagar, Bathinda, Punjab 151001, India. https://doi.org/10.21632/irjbs.12.2.137-143

Development of Sustainable Recycling Investment Framework Considering Uncertain Demand and Nonlinear Recycling Cost

This paper presents a more active and efficient recycling investment strategy that considers the balances among the current production constraints, manufacturing profits, and recycling investments for a sustainable circular economy as compared to the current methods. While existing production planning has numerous uncertainties and nonlinear characteristics, the circular economy-based production planning constitutes more complex uncertainties and nonlinear characteristics that result from an uncertain return rate, demand uncertainties, and nonlinear return on investment costs. This paper suggests a stochastic nonlinear programming model-based active recycling investment framework so as to generate a more effective process plan to handle these characteristics. In the proposed framework, recycling investment strategies are quantitatively analyzed when considering uncertain demand and unclear production conditions. In addition, the effective solving techniques for the circular economy based production framework are obtained while using Monte-Carlo based sample average approximation and memetic algorithm. To prove the effectiveness of the proposed framework, it is implemented for a given system and the numerical analyses that were conducted for the various sustainable manufacturing scenarios.

Integrated framework for information security investment and cyber insurance

This paper presents analytical models for optimizing firm's cybersecurity spending and cyber insurance based on the effectiveness of spending in reducing cyber threats, vulnerability and impact, respectively. At the macro-level, the paper shows how private-sector contribution toward countering cybercrimes can reduce the overall cyber loss and create economic value. At the micro level, a firm's effectiveness of security spending in addressing specific cyber threats can be reduced when other co-dependent security measures are not put in place. The paper derives an optimal mix of cybersecurity investments in “knowledge and expertise” versus “deploying mitigation measures”. The paper proposes customizing cyber insurance for firms with itemized threat-specific coverage with a portion of the premium used to help clients with risk knowledge and nudge clients in implementing risk mitigation measures. Small and Mid-sized Enterprises can stand benefit the most from such innovative cyber insurance.

Public Investment in Russia: Peculiarities of Implementation and Ways to Improve Efficiency

The study of dynamics and peculiarities of the main forms of public investment in Russia in order to find mechanisms to improve the efficiency of public investment. The research offers options to solve the problem of improving the efficiency of public investment in Russia. Apart from the measures designed to improve the statutory legal framework for public investment, it is necessary to revise the approach to the management of all public finances.

Forest Investment Framework as a Support Tool for the Sustainable Management of Planted Forests

Planted forest ecosystems provide a wide range of goods and services such as timber, carbon sequestration, and avoided erosion. However, only ecosystem services with market values (e.g., timber) are usually represented in decision making while those with non-market values (e.g., avoided erosion) that are difficult to quantify are often ignored. A spatial economic tool, the Forest Investment Framework (FIF), integrates data from forest growth models with spatial, biophysical, and economic data, to quantify the broader value of planted forests and to represent non-market values in sustainable forest management. In this paper, we have tested the applicability of FIF in three types of case studies: assessment of afforestation feasibility, regional economic analyses, and ecosystem service assessment. This study provides evidence that a spatial economic tool that quantifies the economic, environmental, and social values of the planted forest ecosystem is valuable in informing land management decisions for maintaining and enhancing the provision of market and non-market ecosystem services to society.

Wavelet analysis of the conventional and Islamic stock market relationship ten years after the global financial crisis

ABSTRACT This paper studies the relationship between conventional and Islamic stock markets in the US and worldwide ten years after the recent global financial crisis (GFC). Specifically, it empirically verifies whether the Islamic stock market would be a reliable alternative to the conventional one. Using wavelet analysis, we show a positive and significant correlation between the two stock markets, which has increased significantly in the aftermath of the GFC. This finding qualifies the Islamic stock market as a rather different market that could become a real alternative only if it proposes a less risky investment framework.