Exploring the role of U.K. Government policy in developing the university entrepreneurial finance ecosystem for Cleantech

Vast sums of public money are invested into universities globally as anchor institutions and knowledge bases providing seedbed resources for research and development (R&D) and entrepreneurship. Focusing on university science and technology (S&T) research we examine two UK case studies of government support from the ‘Innovation Knowledge Centre’ (IKC) program to translate research into industry innovation for public good. Although IKCs are not tasked to address Climate Change, the two case studies demonstrate tremendous potential for Cleantech development. An exploratory entrepreneurial finance (‘entfin’) ecosystem theoretical lens contextualizes the catalytic roles of universities and public funding to support industry at the base of the innovation finance escalator. We thus develop university-industry ecosystems literature, addressing the gap in nurturing university entfin for climate change. Our qualitative case study methodology includes literature review and 51 key informant interviews with: policymakers; university research leaders, technology transfer officers, specialist research to industry innovation ‘translation’ staff, SME beneficiaries, trade bodies; and early-stage private finance providers. We reveal nuances in different emerging innovation sectors – notably their degree of maturity, locality and outcome horizons for achieving impact, drawing attention to the key roles of universities and financing and their interactions within their entfin ecosystems. We demonstrate the need for government long horizon, deep pocket, investment and integrated university entfin policy mix, alongside more open, inclusive, ecosystem development between different actors

Long-Term Functionality of Rural Water Services in Developing Countries: A System Dynamics Approach to Understanding the Dynamic Interaction of Causal Factors

Research has shown that sustainability of rural water infrastructure in developing countries is largely affected by the dynamic and systemic interactions of technical, social, financial, institutional, and environmental factors that can lead to premature water system failure. This research employs systems dynamic modeling, which uses feedback mechanisms to understand how these factors interact dynamically to influence long-term rural water system functionality. To do this, the research first identified and aggregated key factors from literature, then asked water sector experts to indicate the polarity and strength between factors through Delphi and cross impact survey questionnaires, and finally used system dynamics modeling to identify and prioritize feedback mechanisms. The resulting model identified 101 feedback mechanisms that were dominated primarily by three and four-factor loops that contained some combination of the factors: Water System Functionality, Community, Financial, Government, Management, and Technology. These feedback mechanisms were then scored and prioritized, with the most dominant feedback mechanism identified as Water System Functionality – Community – Finance – Management. This research offers insight into the dynamic interaction of factors impacting sustainability of rural water infrastructure through the identification of these feedback mechanisms and makes a compelling case for future research to longitudinally investigate the interaction of these factors in various contexts

A mixed singular/switching control problem for a dividend policy with reversible technology investment

We consider a mixed stochastic control problem that arises in Mathematical Finance literature with the study of interactions between dividend policy and investment. This problem combines features of both optimal switching and singular control. We prove that our mixed problem can be decoupled in two pure optimal stopping and singular control problems. Furthermore, we describe the form of the optimal strategy by means of viscosity solution techniques and smooth-fit properties on the corresponding system of variational inequalities. Our results are of a quasi-explicit nature. From a financial viewpoint, we characterize situations where a firm manager decides optimally to postpone dividend distribution in order to invest in a reversible growth opportunity corresponding to a modern technology. In this paper a reversible opportunity means that the firm may disinvest from the modern technology and return back to its old technology by receiving some gain compensation. The results of our analysis take qualitatively different forms depending on the parameters values.Comment: Published in at http://dx.doi.org/10.1214/07-AAP482 the Annals of Applied Probability (http://www.imstat.org/aap/) by the Institute of Mathematical Statistics (http://www.imstat.org

A political economy of niche-building: neoliberal-developmental encounters in photovoltaic electrification in Kenya

International agreements on energy access and climate change, formulated according to neoliberal orthodoxy, will drive significant finance to developing countries for clean technology investments. But critics call for more active state intervention – a developmental approach – arguing that free markets alone will not deliver what is required. This creates the potential for confrontation between contradictory ideologies in national policymaking and implementation: neoliberalism in global agreements versus developmentalism in national policy. The Kenyan photovoltaics (PV) market has long-experienced neoliberal-developmental policy interactions, reflecting on which can illuminate how such encounters might unfold in the future. We construct a new ‘niche political economy’ theoretical framework to analyse these past interactions, constituting one of three contributions we offer. The second is empirical, showing how PV practitioners, national policymakers and global development actors have negotiated their policymaking encounters over time. Our third contribution offers reflections on the issues explored, discussing what this might mean for future neoliberal-developmental encounters. We find that action on the ground will emerge from messy negotiated interactions between competing ideologies rather than be determined by powerful neoliberal actors. As such, realising global energy and climate ambitions becomes even more uncertain unless long-term active niche-building resources are secured in international agreements

Fiscal aspect of evolving federations : issues for policy and research

Recent experience with fiscal decentralization in many developing and transition economies has led many observers to question whether fiscal decentralization undermines macroeconomic stability. In several countries, transfers from central to lower-level governments have increased fiscal deficits at the central level, creating pressures on central banks to monetize additional debt, thus jeopardizing price stability. In other countries, central governments trying to control their deficits have reduced transfers to lower level governments, creating fiscal distress at lower levels. These issues of macroeconomic fiscal stability have not featured prominently in North American policy debates about fiscal federalism, nor has much academic research been devoted to them. In a world where the state's basic political organization is undergoing rapid reform and restructuring, the tensions and opportunities created by fiscal interactions among levels of government are of critical concern. Much of the literature on fiscal federalism has been geared to the situation in such industrial countries as Canada and the United States. Policymakers and researcher should identify the institutional structures of stable, mature federations that help sustain satisfactory macroeconomic performance. But different policy problems are likely to arise in different settings, especially in the developing world. Among topics that deserve further research attention: i) The interplay between intergovernmental grants and government borrowing. ii) What is the difference in effect on lower-level governments between"hard"and"soft"budget constraints? What economic distortions are associated with soft budget constraints? What institutional reforms might help to establish hard budget constraints? iii) Is the"country"still the appropriate unit of analysis for important economic issues? What economic benefits or costs result from including several regions within one jurisdictional structure? What economic considerations determine the optimal size of a"country"and what are the crucial economic functions of"national"governments? iv) Demographic change, changes in communication and transportation technology, and the development of market institutions may alter the optimal or equilibrium boundaries of political units over time. Such change invariably raises questions about the organization of the public sector and the assignment of expenditures and revenues to different levels of government. The patterns of gains and losses from reorganizing factor markets and jurisdictional structures can be complex. To understand them fully requires understanding the economic consequences of changes in both market organization and policy outcomes resulting from reorganization of the public sector.Public Sector Economics&Finance,Banks&Banking Reform,National Governance,Municipal Financial Management,Public&Municipal Finance,Public Sector Economics&Finance,Municipal Financial Management,Urban Economics,National Governance,Banks&Banking Reform

The influence of organizational culture on the outcome of an IS implementation

A number of information system (IS) studies have adopted organizational culture (OC) theory to investigate IS implementations. The studies highlight that members will reach consensus or agreement in the use of an IS but also experience inevitable tensions and ambiguities in the use of the IS. However, literature related to IS implementation/OC has rarely examined the influence that the saliency of specific cultural practices may have on the success or failure of IS implementations. Using a case study approach, we adopted the “soft positivism” research philosophy to collect data, underpinned by Martin’s (1992) integration and differentiation perspectives of OC to study organizational implementation of an IS. These perspectives served as interpretive lenses through which to explain how members’ salient behaviors towards an IS evolved during the implementation process. Our study augments the IS implementation/OC literature by demonstrating how salient cultural practices influence the outcome of IS implementatio

Conceptualising seasonal financial market failures and credit rationing in applied rural household models

A wide variety of farm household models have provided a valuable theoretical basis for empirical and conceptual analysis of interactions between production and consumption resource allocations of poor rural people. A weakness of common applications of many such models, and unfortunately of much analysis, is failure to routinely also recognise and adequately describe the fundamental seasonal nature of most agricultural production and the effects of pervasive seasonal finance market failures on poor rural people’s behaviour and welfare. This is despite considerable theoretical work demonstrating the importance of seasonal financial market failures as constraints on agricultural development. A general model recognising this is presented, with graphical applications showing the potential importance of seasonal finance constraints on farm households’ behaviour and welfare . Formal methods for allowing for the effects of seasonal finance constraints on household responses to policy and other change should be standard tools used by applied rural development economists

Beyond technology and finance: pay-as-you-go sustainable energy access and theories of social change

Two-thirds of people in sub-Saharan Africa lack access to electricity, a precursor of poverty reduction and development. The international community has ambitious commitments in this regard, e.g. the UN's Sustainable Energy for All by 2030. But scholarship has not kept up with policy ambitions. This paper operationalises a sociotechnical transitions perspective to analyse for the first time the potential of new, mobileenabled, pay-as-you-go approaches to financing sustainable energy access, focussing on a case study of pay-as-you-go approaches to financing solar home systems in Kenya. The analysis calls into question the adequacy of the dominant, two-dimensional treatment of sustainable energy access in the literature as a purely financial/technology, economics/ engineering problem (which ignores sociocultural and political considerations) and demonstrates the value of a new research agenda that explicitly attends to theories of social change – even when, as in this paper, the focus is purely on finance. The paper demonstrates that sociocultural considerations cut across the literature's traditional two-dimensional analytic categories (technology and finance) and are material to the likely success of any technological or financial intervention. It also demonstrates that the alignment of new payas- you-go finance approaches with existing sociocultural practices of paying for energy can explain their early success and likely longevity relative to traditional finance approaches

Rethinking bank business models: the role of intangibles

<p>Purpose: This paper provides a new way of rethinking banking models by using qualitative research on intangibles. This is required because the banking sector has been transformed significantly by the changing environment over the past two decades. The 2007-2009 financial crisis also added to concerns about existing bank business models.</p> <p>Design/Methodology approach: Using qualitative data collected from interviews with bank managers and analysts in the UK, this paper develops a grounded theory of bank intangibles.</p> <p>Findings: The model reveals how intangibles and tangible/financial resources interact in the bank value creation process, how they actively respond to environmental changes, how bank intangibles are understood by external observers such as analysts, and how bankers and analysts differ in their views.</p> <p>Research implications: Grounded theory provides the means to further develop bank models as business models and theoretical models. This provides the means to think beyond conventional finance constructs and to relate bank models to a wider theoretical literature concerning intellectual capital, organisational and social systems theory, and ‘performativity’.</p> <p>Practical implications: Such development of bank models and of a systems perspective is critical to the understanding of banks by bankers, by observers and for their ‘critical and reflexive performativity’. It also has implications for systemic risk and bank regulation.</p> <p>Social implications: Improvement in bank models and their use in open and transparent processes are key means to improve public accountability of banks.</p> <p>Originality: The paper reveals the core role of intellectual capital (IC) in banks, in markets, and in developing theory and research at firm and system levels. </p&gt