Search results for: investment%20decision

Authors: Alok S Chauhan, Sridhar S., Pradyumna R.

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In the process of precision investment casting of turbine hollow blade/vane components, a part of the dimensional deviations observed in the castings can be attributed to the wax pattern. In the process of injection moulding of wax to produce patterns, heated wax shrinks in size during cooling in the die, leading to a reduction in the dimensions of the pattern. Also, flow and thermal induced residual stresses result in shrinkage & warpage of the component after removal from the die, further adding to the deviations. Injection moulding parameters such as wax temperature, flow rate, packing pressure, etc. affect the flow and thermal behavior of the component and hence are directly responsible for the dimensional deviations. There is a need to precisely determine and control these deviations in order to achieve stringent dimensional accuracies imposed on these castings by aerospace standards. Simulation based approaches provide a platform to predict these dimensional deviations without resorting to elaborate experimentation. In the present paper, Moldex3D simulation package has been utilized to analyze the effect of variations in injection temperature, packing pressure and cooling time on the shrinkage behavior of a stepped pattern. Two types of waxes with different rheological properties have been included in the study to gauge the effect of change in wax on the dimensional deviations. A full factorial design of experiments has been configured with these parameters and results of analysis of variance have been presented.

Keywords: wax patterns, investment casting, pattern die/mould, wax injection, Moldex3D simulation

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Authors: Y. Ghiassi-Farrokhfal

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The number of electric vehicles (EVs) is increasing worldwide. Replacing gas fueled cars with EVs reduces carbon emission. However, the extensive energy consumption of EVs stresses the energy systems, requiring non-green sources of energy (such as gas turbines) to compensate for the new energy demand caused by EVs in the energy systems. To make EVs even a greener solution for the future energy systems, new EV charging stations are equipped with solar PV panels and batteries. This will help serve the energy demand of EVs through the green energy of solar panels. To ensure energy availability, solar panels are combined with batteries. The energy surplus at any point is stored in batteries and is used when there is not enough solar energy to serve the demand. While EV charging stations equipped with solar panels and batteries are green and ecologically optimal, they might not be financially viable solutions, due to battery prices. To make the system viable, we should size the battery economically and operate the system optimally. This is, in general, a challenging problem because of the stochastic nature of the EV arrivals at the charging station, the available solar energy, and the battery operating system. In this work, we provide a mathematical model for this problem and we compute the return on investment (ROI) of such a system, which is designed to be ecologically and financially optimal. We also quantify the minimum required investment in terms of battery and solar panels along with the operating strategy to ensure that a charging station has enough energy to serve its EV demand at any time.

Keywords: solar energy, battery storage, electric vehicle, charging stations

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Authors: Ran Etgar, Yuval Cohen, Erel Avineri

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One of the major challenges of transportation in medium sized inner-cities (such as Tel-Aviv) is the last-mile solution. Personal rapid transit (PRT) seems like an applicable candidate for this, as it combines the benefits of personal (car) travel with the operational benefits of transit. However, the investment required for large area PRT grid is significant and there is a need to economically justify such investment by correctly evaluating the grid capacity. PRT main elements are small automated vehicles (sometimes referred to as podcars) operating on a network of specially built guideways. The research is looking at a specific concept of elevated PRT system. Literature review has revealed the drawbacks PRT modelling and simulation approaches, mainly due to the lack of consideration of technical and operational features of the system (such as headways, acceleration, safety issues); the detailed design of infrastructure (guideways, stations, and docks); the stochastic and sessional characteristics of demand; and safety regulations – all of them have a strong effect on the system performance. A highly detailed model of the system, developed in this research, is applying a discrete event simulation combined with an agent-based approach, to represent the system elements and the podecars movement logic. Applying a case study approach, the simulation model is used to study the capacity of the system, the expected throughput of the system, the utilization, and the level of service (journey time, waiting time, etc.).

Keywords: capacity, productivity measurement, PRT, simulation, transportation

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Authors: V. Charaia

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From the strategic point of view, not all Foreign Direct Investments (FDIs) are always positively benefiting the host economy, i.e. not all Multinational Enterprises (MNEs) are promoting local/host economies. FDI could have different impact on different sectors of the economy, based not only on annual investment amount, but MNE motivations and peculiarities of the host economy in particular. FDI analysis based only on its amount can lead to incorrect decisions, it is much more important to understand the essence of investment. Consequently, our research is oriented on MNE’s motivations, answering which sectors are most popular among international investors and why, what motivated them to invest into one or another business. Georgian economy for the last period of time is attracting more and more efficiency seeking investments, which could be translated as - concentrating production in a limited number of locations to supply various markets, while benefiting local economy with: new technologies, employment, exports diversification, increased income for the local economy and so on. Foreign investors and MNEs in particular are no longer and not so much interested in the resource seeking investments, which was the case for Georgia in the last decade of XX century. Despite the fact of huge progress for the Georgian economy, still there is a room for foreign investors to make a local market oriented investments. The local market is still rich in imported products, which should be replaced by local ones. And the last but not the least important issue is that approximately 30% of all FDIs in Georgia according to this research are “efficiency seeking” investments, which is an enormous progress and a hope for future Georgian success.

Keywords: investments, MNE, FDI motivations, Georgian economy

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Authors: David Calderon Villegas, Thomas Kaltizky

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Run-of-river (RoR) hydropower projects represent a viable, clean, and cost-effective alternative to dam-based plants and provide decentralized power production. However, RoR schemes cost-effectiveness depends on the proper selection of site and design flow, which is a challenging task because it requires multivariate analysis. In this respect, this study presents the development of an investment decision support tool for assessing the optimal size of an RoR scheme considering the technical, environmental, and cost constraints. The net present value (NPV) from a project perspective is used as an objective function for supporting the investment decision. The tool has been tested by applying it to an actual RoR project recently proposed in Colombia. The obtained results show that the optimum point in financial terms does not match the flow that maximizes energy generation from exploiting the river's available flow. For the case study, the flow that maximizes energy corresponds to a value of 5.1 m3/s. In comparison, an amount of 2.1 m3/s maximizes the investors NPV. Finally, a sensitivity analysis is performed to determine the NPV as a function of the debt rate changes and the electricity prices and the CapEx. Even for the worst-case scenario, the optimal size represents a positive business case with an NPV of 2.2 USD million and an IRR 1.5 times higher than the discount rate.

Keywords: small hydropower, renewable energy, RoR schemes, optimal sizing, objective function

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Authors: Anna Paola Micheli, Anna Maria Calce, Loris Di Nallo

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Sustainable finance identifies the process that leads, in the adoption of investment decisions, to take into account environmental and social factors, with the aim of orienting investments towards sustainable and long-term activities. Considering that the topic is at the center of the interest of national agendas, long-term investments will no longer be analyzed only by looking at financial data, but environmental, social, and governance (ESG) factors will be increasingly important and will play a fundamental role in determining the risk and return of an investment. Although this perspective does not deny the orientation to profit, ESG mutual funds represent sustainable finance applied to the world of mutual funds. So the goal of this paper is to verify this attitude, in particular in the energy sector. The choice of the sector is not casual: ESG is the acronym for environmental, social, and governance, and energy companies are strictly related to the environmental theme. The methodology adopted leads to a comparison between a sample of ESG funds and a sample of ESG funds with similar characteristics, using the most important indicators of literature: yield, standard deviation, and Sharpe index. The analysis is focused on equity funds. Results that are partial, due to the lack of historicity, show a good performance of ESG funds, testifying how a sustainable approach does not necessarily mean lower profits. It is clear that these first findings do not involve an absolute preference for ESG funds in terms of performance because the persistence of results is requested. Furthermore, these findings are to be verified in other sectors and in bond funds.

Keywords: mutual funds, ESG, performance, energy

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Authors: Kathleen Frances Haigh, Mieke Nieder-Heitmann, Somayeh Farzad, Mohsen Ali Mandegari, Johann Ferdinand Gorgens

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Lignocellulose can be converted to a range of biochemicals and biofuels. Where this is derived from agricultural waste, issues of competition with food are virtually eliminated. One such source of lignocellulose is the South African sugar industry. Lignocellulose could be accessed by changes to the current farming practices and investments in more efficient boilers. The South African sugar industry is struggling due to falling sugar prices and increasing costs and it is proposed that annexing a biorefinery to a sugar mill will broaden the product range and improve viability. Process simulations of the selected chemicals were generated using Aspen Plus®. It was envisaged that a biorefinery would be annexed to a typical South African sugar mill. Bagasse would be diverted from the existing boilers to the biorefinery and mixed with harvest residues. This biomass would provide the feedstock for the biorefinery and the process energy for the biorefinery and sugar mill. Thus, in all scenarios a portion of the biomass was diverted to a new efficient combined heat and power plant (CHP). The Aspen Plus® simulations provided the mass and energy balance data to carry out an economic assessment of each scenarios. The net present value (NPV), internal rate of return (IRR) and minimum selling price (MSP) was calculated for each scenario. As a starting point scenarios were generated to investigate the production of ethanol, ethanol and lactic acid, ethanol and furfural, butanol, methanol, and Fischer-Tropsch syncrude. The bypass to the CHP plant is a useful indicator of the energy demands of the chemical processes. An iterative approach was used to identify a suitable bypass because increasing this value had the combined effect of increasing the amount of energy available and reducing the capacity of the chemical plant. Bypass values ranged from 30% for syncrude production to 50% for combined ethanol and furfural production. A hurdle rate of 15.7% was selected for the IRR. The butanol, combined ethanol and furfural, or the Fischer-Tropsch syncrude scenarios are unsuitable for investment with IRRs of 4.8%, 7.5% and 11.5% respectively. This provides valuable insights into research opportunities. For example furfural from sugarcane bagasse is an established process although the integration of furfural production with ethanol is less well understood. The IRR for the ethanol scenario was 14.7%, which is below the investment criteria, but given the technological maturity it may still be considered for investment. The scenarios which met the investment criteria were the combined ethanol and lactic acid, and the methanol scenarios with IRRs of 20.5% and 16.7%, respectively. These assessments show that the production of biochemicals from lignocellulose can be commercially viable. In addition, this assessment have provided valuable insights for research to improve the commercial viability of additional chemicals and scenarios. This has led to further assessments of the production of itaconic acid, succinic acid, citric acid, xylitol, polyhydroxybutyrate, polyethylene, glucaric acid and glutamic acid.

Keywords: biorefineries, sugar mill, methanol, ethanol

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Authors: Papathanasiou Anastasios, Liontos George, Liagkou Vasiliki, Glavas Euripides

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The purpose of this paper is to describe the growing problem of various cyber fraud schemes that exist on the internet and are currently among the most prevalent. The main focus of this paper is to provide a detailed description of the modus operandi, tools, and techniques utilized in four basic typologies of cyber frauds: Business Email Compromise (BEC) attacks, investment fraud, romance scams, and online sales fraud. The paper aims to shed light on the methods employed by cybercriminals in perpetrating these types of fraud, as well as the strategies they use to deceive and victimize individuals and businesses on the internet. Furthermore, this study outlines defense strategies intended to tackle the issue head-on, with a particular emphasis on the crucial role played by European Legislation. European legislation has proactively adapted to the evolving landscape of cyber fraud, striving to enhance cybersecurity awareness, bolster user education, and implement advanced technical controls to mitigate associated risks. The paper evaluates the advantages and innovations brought about by the European Legislation while also acknowledging potential flaws that cybercriminals might exploit. As a result, recommendations for refining the legislation are offered in this study in order to better address this pressing issue.

Keywords: business email compromise, cybercrime, European legislation, investment fraud, NIS, online sales fraud, romance scams

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Authors: K. Volkonitskaya, S. Lyapina

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According to the National Monitoring Centre of innovation infrastructure, scientific and technical activities and regional innovation systems by December 2014. 166 technology parks were established in Russia. Comparative analysis of technological parks performance in Russia, the USA, Israel and the European Union countries revealed significant reduction of key performance indicators in Russian innovation infrastructure institutes. The largest deviations were determined in the following indicators: new products and services launched, number of companies and jobs, amount of venture capital invested. Lower performance indicators of Russian technology parks can be partly explained by slack demand for national high-tech products and services, lack of qualified specialists in the sphere of innovation management and insufficient cooperation between different innovation infrastructure institutes. In spite of all constraints in innovation segment of Russian economy in 2010-2012 private investors for the first time proceeded to finance building of technological parks. The general purpose of the research is to answer two questions: why despite the significant investment risks private investors continue to implement such comprehensive infrastructure projects in Russia and is business model of private technological park more efficient than strategies of state innovation infrastructure institutes? The goal of the research was achieved by analyzing business models of private technological parks in Moscow, Kaliningrad, Astrakhan and Kazan. The research was conducted in two stages: the on-line survey of key performance indicators of private and state Russian technological parks and in-depth interviews with top managers and investors, who have already build private technological parks in by 2014 or are going to complete investment stage in 2014-2016. The results anticipated are intended to identify the reasons of efficient and inefficient technological parks performance. Furthermore, recommendations for improving the efficiency of state technological and industrial parks were formulated. Particularly, the recommendations affect the following issues: networking with other infrastructural institutes, services and infrastructure provided, mechanisms of public-private partnership and investment attraction. In general intensive study of private technological parks performance and development of effective mechanisms of state support can have a positive impact on the growth rates of the number of Russian technological, industrial and science parks.

Keywords: innovation development, innovation infrastructure, private technology park, public-private partnership

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Authors: Bahareh Mostofian

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Foreign Direct Investment (FDI) has long been recognized as a crucial driver of economic growth and development in less-developed countries and their integration into Global Production Networks (GPNs). FDI not only brings capital from the core countries but also technology, innovation, and know-how knowledge that can upgrade the capabilities of host automotive industries. On the other hand, FDI can also have negative impacts on host countries if it leads to significant import dependency. In the case of the Iranian automotive sector, the industry greatly benefited from FDI, with Western carmakers dominating the market. Over time, various types of know-how knowledge, including joint ventures (JVs), trade licenses, and technical assistance, have been provided, helping Iran upgrade its automotive industry. While after the severe geopolitical obstacles imposed by both the EU and the U.S., the industry became over-reliant on the car and spare parts imports, and the lack of emphasis on knowledge transfer further affected the growth and development of the Iranian automotive sector. To address these challenges, current research has adopted a descriptive-analytical methodology to illustrate the gradual changes accrued with foreign suppliers through FDI. The research finding shows that after the two-phase imposed sanctions, the detrimental linkages created by overreliance on the car and spare parts imports without any industrial upgrading negatively affected the growth and development of the national and assembled products of the Iranian automotive sector.

Keywords: less-developed country, FDI, GPNs, automotive industry, Iran

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Authors: Dharshini M., Hema N. S.

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The project for the production of aniline is done by providing 295.46 tons per day of nitrobenzene as feed. The material and energy balance calculations for the different equipment like distillation column, heat exchangers, reactor and mixer are carried out with simulation via DWSIM. The conversion of nitrobenzene to aniline by hydrogenation process is considered to be 96% and the total production of the plant was found to be 215 TPD. The cost estimation of the process is carried out to estimate the feasibility of the plant. The net profit and percentage return of investment is estimated to be ₹27 crores and 24.6%. The payback period was estimated to be 4.05 years and the unit production cost is ₹113/kg. A techno-economic analysis was performed for the production of aniline; the result includes economic analysis and sensitivity analysis of critical factors. From economic analysis, larger the plant scale increases the total capital investment and annual operating cost, even though the unit production cost decreases. Uncertainty analysis was performed to predict the influence of economic factors on profitability and the scenario analysis is one way to quantify uncertainty. In scenario analysis the best-case scenario and the worst-case scenario are compared with the base case scenario. The best-case scenario was found at a feed rate of 120 kmol/hr with a unit production cost of ₹112.05/kg and the worst-case scenario was found at a feed rate of 60 kmol/hr with a unit production cost of ₹115.9/kg. The base case is closely related to the best case by 99.2% in terms of unit production cost. since the unit production cost is less and the profitability is more with less payback time, it is feasible to construct a plant at this capacity.

Keywords: aniline, nitrobenzene, economic analysis, unit production cost

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Authors: Zahra Bakhtiari

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Middle East countries confront a multitude of main environmental challenges which are inevitable. The unstable economic and political structure which dominates numerous middle East countries makes it difficult to react effectively to unfavorable climate change impacts. This study applies a qualitative methodology and relies on secondary literature aimed to investigate how countries in the Middle East are balancing economic security and climatic security in terms of budgeting, infrastructure investment, political engagement (domestically through discourses or internationally in terms of participation in international organizations or bargaining, etc.) There has been provided an outline of innovative measures in both economic and environmental fields that are in progress in the Middle East countries and what capacity they have for economic development and environmental adaptation, as well as what has already been performed. The primary outcome is that countries that rely more on infrastructure investment such as negative emissions technologies (NET) through green social capital enterprises and political engagement, especially nationally determined contributions (NDCs) commitments and United Nations Framework Convention on Climate Change (UNFCCC), experience more economic and climatological security balance in the Middle East. Since implementing these measures is not the same in all countries in the region, we see different levels of balance between climate security and economic security. The overall suggestion is that the collaboration of both the bottom-up and top-down approaches helps create strategic environmental strategies which are in line with the economic circumstances of each country and creates the desired balance.

Keywords: climate change, economic growth, sustainability, the Middle East, green economy, renewable energy

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Authors: Gebrehiwot H., Giorgis Bahita

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Firms in Africa experience less financial market in comparison to other emerging and developed countries, thus lagging behind the rest of the world in terms of innovation and growth. Though there are different factors to be considered, underdeveloped financial systems take the lion's share in hindering firm innovation and growth in Africa. Insufficient capacity to innovate is one of the problems facing African businesses. Moreover, a critical challenge faced by firms in Africa is access to finance and the inability of financially constrained firms to grow. Only little is known about how different sources of finance affect firm innovation and growth in Africa, specifically the formal and informal finance effect on firm innovation and growth. This study's aim is to address this gap by using formal and informal finance for working capital and fixed capital and its role in firm innovation and firm growth using firm-level data from the World Bank enterprise survey 2006-2019 with a total of 5661 sample firms from 14 countries based on available data on the selected variables. Additionally, this study examines factors for accessing credit from a formal financial institution. The logit model is used to examine the effect of finance on a firm’s innovation and factors to access formal finance, while the Ordinary List Square (OLS) regression mode is used to investigate the effect of finance on firm growth. 2SLS instrumental variables are used to address the possible endogeneity problem in firm growth and finance-innovation relationships. A result from the logistic regression indicates that both formal and informal finance used for working capital and investment in fixed capital was found to have a significant positive association with product and process innovation. In the case of finance and growth, finding show that positive association of both formal and informal financing to working capital and new investment in fixed capital though the informal has positive relations to firm growth as measured by sale growth but no significant association as measured by employment growth. Formal finance shows more magnitude of effect on innovation and growth when firms use formal finance to finance investment in fixed capital, while informal finance show less compared to formal finance and this confirms previous studies as informal is mainly used for working capital in underdeveloped economies like Africa. The factors that determine credit access: Age, firm size, managerial experience, exporting, gender, and foreign ownership are found to have significant determinant factors in accessing credit from formal and informal sources among the selected sample countries.

Keywords: formal finance, informal finance, innovation, growth

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Authors: Saurabh Gupta, Vanshdeep Parmar, Sri Harsha Reddy Yelly, Michele Baker, Elizabeth Bigler, Kunhee Choi

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It is known that the adoption of solar powered LED highway lighting systems or sensory LED highway lighting systems can dramatically reduce energy consumption by 55 percent when compared to conventional on-grid High Pressure Sodium (HPS) lamps that are widely applied to most highways. However, an initial high installation cost for building the infrastructure of solar photovoltaic devices hampers a wider adoption of such technologies. This research aims to examine currently available state-of-the-art solar photovoltaic and sensory technologies, identify major obstacles, and analyze each technology to create a benchmarking metrics from the benefit-cost analysis perspective. The on-grid HPS lighting systems will serve as the baseline for this study to compare it with other lighting alternatives such as solar and sensory LED lighting systems. This research will test the validity of the research hypothesis that alternative LED lighting systems produce more favorable benefit-cost ratios and the added initial investment costs are recouped by the savings in the operation and maintenance cost. The payback period of the excess investment and projected savings over the life-cycle of the selected lighting systems will be analyzed by utilizing the concept of Net Present Value (NPV). Researchers believe that if this study validates the research hypothesis, it can promote a wider adoption of alternative lighting systems that will eventually save millions of taxpayer dollars in the long-run.

Keywords: lighting systems, sensory and solar PV, benefit cost analysis, net present value

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Authors: M. Javahar, H. B. Dong

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Single crystal components manufactured using Ni-base Superalloys are routinely used in the hot sections of aero engines and industrial gas turbines due to their outstanding high temperature strength, toughness and resistance to degradation in corrosive and oxidative environments. To control the quality of the single crystal turbine blades, particular attention has been paid to grain selection, which is used to obtain the single crystal morphology from a plethora of columnar grains. For this purpose, different designs of grain selectors are employed and the most common type is the spiral grain selector. A typical spiral grain selector includes a starter block and a spiral (helix) located above. It has been found that the grains with orientation well aligned to the thermal gradient survive in the starter block by competitive grain growth while the selection of the single crystal grain occurs in the spiral part. In the present study, 2D spiral selectors with different geometries were designed and produced using a state-of-the-art Bridgeman Directional Solidification casting furnace to investigate the competitive growth during grain selection in 2d grain selectors. The principal advantage of using a 2-D selector is to facilitate the wax injection process in investment casting by enabling significant degree of automation. The automation within the process can be derived by producing 2D grain selector wax patterns parts using a split die (metal mold model) coupled with wax injection stage. This will not only produce the part with high accuracy but also at an acceptable production rate.

Keywords: grain selector, single crystal, directional solidification, CMSX-4 superalloys, investment casting

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Authors: Stanley Yap, Chong Wei Ying, Leow Hon Wei

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Purpose: In Malaysia, an effective financial planning is vital to accumulate wealth and financial independence. However, retirees are required to resume working due to insufficient pension fund. This study examines how the financial decision in retirement planning is being made based on the net worth from the household. Design/methodology/approach: This study uses financial data from a married working couple with children to evaluate their composition of financial position. Numerous financial methods are made pertaining to net worth analysis, insurance needs analysis, investment portfolio rebalancing, estate planning, education planning and retirement planning to enhance the financial decision. Findings: Our results show, firstly, financial planning is essential to achieve financial independence; secondly, insurance needs, education and retirement funding are the most significant for household. Thirdly, current resources are critical to maintain family lifestyle after retirement, emergency funds for critical illness, and the long term children education funding. Practical implications: Refer to the findings, sufficient net worth is priority in financial planning. Different suggestions for household include reduction of unnecessary expenses, re-allocate of cash flow, adequate insurance coverage and re-balancing of investment portfolios to accumulate wealth. It is a challenge to obtain financial independence, hence, there is a need to increase the literature on financial planning. Originality/value: To the best of our knowledge, this is the important paper that uses financial information from household to provide solutions to enhance the efficiency of financial planning industry.

Keywords: net worth, financial planning, wealth and financial independence, retirement planning

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Authors: Eliane Abdo, Olivier Colot

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SMEs are always considered as a national priority due to their contribution to job creation, innovation and growth. Once the start-up phase is crossed with encouraging results, the company enters the phase of growth. In order to improve its competitiveness, maintain and increase its market share, the company is in the necessity even the obligation to develop its tangible and intangible investments. SMEs are generally closed companies with special and critical financial situation, limited resources and difficulty to access the capital markets; their shareholders are always living in a conflict between their independence and their need to increase capital that leads to the entry of new shareholder. The capital structure was always considered the core of research in corporate finance; moreover, the financial crisis and its repercussions on the credit’s availability, especially for SMEs make SME financing a hot topic. On the other hand, financial theories do not provide answers to capital structure’s questions; they offer tools and mode of financing that are more accessible to larger companies. Yet, SME’s capital structure can’t be independent of their governance structure. The classic financial theory supposes independence between the investment decision and the financing decision. Thus, investment determines the volume of funding, but not the split between internal or external funds. In this context, we find interesting to study the hypothesis that SMEs respond positively to the financial theories applied to large firms and to check if they are constrained by conventional solutions used by large companies. In this context, this research focuses on the analysis of the resource’s structure of SME in parallel with their investments’ structure, in order to highlight a link between their assets and liabilities structure. We founded our conceptual model based on two main theoretical frameworks: the Pecking order theory, and the Trade Off theory taking into consideration the SME’s characteristics. Our data were generated from DIANE database. Five hypotheses were tested via a panel regression to understand the type of dependence between the financing methods of 3,244 French SMEs and the development of their investment over a period of 10 years (2007-2016). The results show dependence between equity and internal financing in case of intangible investments development. Moreover, this type of business is constraint to financial debts since the guarantees provided are not sufficient to meet the banks' requirements. However, for tangible investments development, SMEs count sequentially on internal financing, bank borrowing, and new shares issuance or hybrid financing. This is compliant to the Pecking Order Theory. We, therefore, conclude that unlisted SMEs incur more financial debts to finance their tangible investments more than their intangible. However, they always prefer internal financing as a first choice. This seems to be confirmed by the assumption that the profitability of the company is negatively related to the increase of the financial debt. Thus, the Pecking Order Theory predictions seem to be the most plausible. Consequently, SMEs primarily rely on self-financing and then go, into debt as a priority to finance their financial deficit.

Keywords: capital structure, investments, life cycle, pecking order theory, trade off theory

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Authors: Naveed Iqbal Chaudhry, Mian Saqib Mehmood, Asif Mehmood

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This study investigates the motivators of foreign direct investment (FDI) which will provide a panacea tool and ground breaking results related to it in case of Pakistan. The study considers exchange rate, market size and human capital as the motivators for attracting FDI. In this regard, time series data on annual basis has been collected for the period 1985–2010 and an Augmented Dickey–Fuller (ADF) and Phillips–Perron (PP) unit root tests are utilized to determine the stationarity of the variables. A bound testing approach to co-integration was applied because the variables included in the model are at I(1) – first level stationary. The empirical findings of this study confirm the long run relationship among the variables. However, market size and human capital have strong positive and significant impact, in short and long-run, for attracting FDI but exchange rate shows negative impact in this regard. The significant negative coefficient of the ECM indicates that it converges towards equilibrium. CUSUM and CUSUMSQ tests plots are with in the lines of critical value, which indicates the stability of the estimated parameters. However, this model can be used by Pakistan in policy and decision making. For achieving higher economic growth and economies of scale, the country should concentrate on the ingredients of this study so that it could attract more FDI as compared to the other countries.

Keywords: ARDL, CUSUM and CUSUMSQ tests, ECM, exchange rate, FDI, human capital, market size, Pakistan

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Authors: Eğinç Simay Ertürk, Ferhan Gezi̇ci̇

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The decline of large cities and the rise of second-tier cities have been observed as a global trend with significant implications for economic development and urban planning. In this context, the concepts of agglomeration shadow and borrowed size have gained importance as network externalities that affect the growth and development of surrounding areas. Istanbul, Izmir, and Ankara are Turkey's most significant metropolitan cities and play a significant role in the country's economy. The surrounding cities rely on these metropolitan cities for economic growth and development. However, the concentration of resources and investment in a single location can lead to agglomeration shadows in the surrounding areas. On the other hand, network connectivity between metropolitan and second-tier cities can result in borrowed function and performance, enabling smaller cities to access resources, investment, and knowledge they would not otherwise have access. The study hypothesizes that the network connectivity between second-tier and metropolitan cities in Turkey enables second-tier cities to increase their urban performance by borrowing size through these networks. Regression analysis will be used to identify specific network connectivity parameters most strongly associated with urban performance. Network connectivity will be measured with parameters such as transportation nodes and telecommunications infrastructure, and urban performance will be measured with an index, including parameters such as employment, education, and industry entrepreneurship, with data at the province levels. The contribution of the study lies in its research on how networking can benefit second-tier cities in Turkey.

Keywords: network connectivity, borrowed size, agglomeration shadow, secondary cities

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Authors: Ana Pego

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Environmental technologies were developed for decades. Clean technologies emerged a few years ago. In these perspectives, the use of cleantech technologies has become very important due the fact of new era of environmental feats. As such, the market itself has become more competitive, more collaborative towards a better use of clean technologies. This paper shows the importance of clean technologies in offshore energy sector in Portuguese market, its localization and its impact on economy. Clean technologies are directly related with renewable cluster and concomitant with economic and social resource optimization criteria, geographic aspects, climate change and soil features. Cleantech is related with regional development, socio-technical transitions in organisations. There are an economical and social combinations which allow specialisation of regions in activities, higher employment, reduce of energy costs, local knowledge spillover and, business collaboration and competitiveness. The methodology used will be quantitative (IO matrix for Portugal 2013) and qualitative (questionnaires to stakeholders). The mix of both methodologies will confirm whether the use of technologies will allow a positive impact on economic and social variables used on this model. It is expected a positive impact on Portuguese economy both in investment and employment taking in account the localization of offshore renewable activities. This means that the importance of offshore renewable investment in Portugal has a few points which should be pointed out: the increase of specialised employment, localization of specific activities in territory, and increase of value added in certain regions. The conclusion will allow researchers and organisation to compare the Portuguese model to other European regions in order to a better use of natural and human resources.

Keywords: cleantech, economic impact, localisation, territory dynamics

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Authors: Wanlapha Phraibueng, Patrick Sentis, Geraldine Riviere-Giordano

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Corporate Social Responsibility (CSR) initiatives have been widely discussed especially in investor-oriented firms. In contrast, cooperatives pay less attention to CSR because their activities have integrated the responsibility and the solidity of social, economic and environment. On the other hand, by adopting ownership theory and agency theory – cooperatives ignore CSR investment due to unclarified decision control in the governance and the limitation to acquire the capital financed. The unique governance and financial structures in cooperatives lead to the conflict among the stakeholders and long-term investment which have an impact on firm financial performance. As an illustration of cooperatives dilemmas, we address the question of Whether or not cooperatives in term of governance and financial structures are the constraints on implementing CSR policies. We find that the governance and financial structures in large cooperatives are the influence factors which predispose cooperatives to invest on CSR. In contrast, in the startup or small cooperatives, its governance and financial structures are the constraints on implementing CSR policies. We propose the alternative financial structure based on the trade-off between debt and equity which aims to relax the restrictions in cooperatives’ governance and allow cooperatives to acquire the capital financed either from its members or non-members. We suggest that engaging equity as a financial structure induces cooperatives to invest on CSR policies. Alternative financial structure eliminates not only cooperative ownership control problem but also the constraints in capital acquisition. By implementing CSR activities consistent with the alternative financial choice, cooperatives can increase firm’s value and reduce the conflict among their stakeholders.

Keywords: cooperatives, corporate social responsibility, financial, governance

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Authors: Somnath Mukhuti, Prem Kumar Ghosh

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Background and significance of the study Indian stock market has undergone sudden changes after the current China crisis in terms of turnover, market capitalization, share prices, etc. The average returns on equity investment in both markets have more than three and half times after global financial crisis owing to the development of industrial activity, corporate sectors development, enhancement in global consumption, change of global financial association and fewer imports from developed countries. But the economic policies of both the economies are far different, that is to say, where Indian economy maintaining a conservative policy, Chinese economy maintaining an aggressive policy. Besides this, Chinese economy recently lowering its currency for increasing mysterious growth but Indian does not. But on August 24, 2015 Indian stock market and world stock markets were fall down due to the reason of Chinese stock market. Keeping in view of the above, this study seeks to examine the influence of Chinese stock on Indian stock market. Methodology This research work is based on daily time series data obtained from yahoo finance database between 2009 (April 1) to 2015 (September 28). This study is based on two important stock markets, that is, Indian stock market (Bombay Stock Exchange) and Chinese stock market (Shanghai Stock Exchange). In the course of analysis, the daily raw data were converted into natural logarithm for minimizing the problem of heteroskedasticity. While tackling the issue, correlation statistics, ADF and PP unit root test, bivariate cointegration test and causality test were used. Major findings Correlation statistics show that both stock markets are associated positively. Both ADF and PP unit root test results demonstrate that the time series data were not normal and were not stationary at level however stationary at 1st difference. The bivariate cointegration test results indicate that the Indian stock market was associated with Chinese stock market in the long-run. The Granger causality test illustrates there was a unidirectional causality between Indian stock market and Chinese stock market. Concluding statement The empirical results recommend that India’s stock market was not very much dependent on Chinese stock market because of Indian economic conservative policies. Nevertheless, Indian stock market might be sturdy if Indian economic policies are changed slightly and if increases the portfolio investment with Chinese economy. Indian economy might be a third largest economy in 2030 if India increases its portfolio investment and trade relations with both Chinese economy and US economy.

Keywords: Indian stock market, China stock market, bivariate cointegration, causality test

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Authors: Pallavi Kishore, Mariam Aslam

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The sharp decline in oil prices that started in 2014 affected most economies in the world either positively or negatively. In some economies, particularly the oil exporting countries, the effects were felt immediately. The Gulf Cooperation Council’s (GCC henceforth) countries are oil and gas-dependent with the largest oil reserves in the world. UAE (United Arab Emirates) has been striving to diversify away from oil and expects higher non-oil growth in 2018. These two factors, falling oil prices and the economy strategizing away from oil dependence, make a compelling case to study the financial performance of various sectors in the economy. Among other sectors, the insurance sector is widely recognized as an important indicator of the health of the economy. An expanding population, surge in construction and infrastructure, increased life expectancy, greater expenditure on automobiles and other luxury goods translate to a booming insurance sector. A slow-down of the insurance sector, on the other hand, may indicate a general slow-down in the economy. Therefore, a study on the insurance sector will help understand the general nature of the current economy. This study involves calculations and comparisons of ratios pre and post the fall in oil prices in the insurance sector in the UAE. A sample of 33 companies listed on the official stock exchanges of UAE-Dubai Financial Market and Abu Dhabi Stock Exchange were collected and empirical analysis employed to study the financial performance pre and post fall in oil prices. Ratios were calculated in 5 categories: Profitability, Liquidity, Leverage, Efficiency, and Investment. The means pre- and post-fall are compared to conclude that the profitability ratios including ROSF (Return on Shareholder Funds), ROCE (Return on Capital Employed) and NPM (Net Profit Margin) have all taken a hit. Parametric tests, including paired t-test, concludes that while the fall in profitability ratios is statistically significant, the other ratios have been quite stable in the period. The efficiency, liquidity, gearing and investment ratios have not been severely affected by the fall in oil prices. This may be due to the implementation of stronger regulatory policies and is a testimony to the diversification into the non-oil economy. The regulatory authorities can use the findings of this study to ensure transparency in revealing financial information to the public and employ policies that will help further the health of the economy. The study will also help understand which areas within the sector could benefit from more regulations.

Keywords: UAE, insurance sector, ratio analysis, oil price, profitability, liquidity, gearing, investment, efficiency

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Authors: Lissette Alejandra Lara, Mario Gomez, Jose Carlos Rodriguez

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ransnational corporations (TNCs) as units in which it is possible technology and knowledge transfer across borders and the potential for generating innovation and contributing in economic development both in home and host countries have been widely acknowledged in the foreign direct investment (FDI) literature. Particularly, the accelerated expansion of emerging countries TNCs in the last decades has guided an uprising research stream that measure the presence of reverse technology transfer, defined as the extent to which emerging countries’ TNCs use outward FDI in a host country through certain mechanisms to absorb and transfer knowledge thus improving its technological capabilities in the home country. The objective of this paper is to test empirically the presence of reverse technology transfer and its impact on the innovation capabilities in Mexican transnational corporations (MXTNCs) as a part of the emerging countries TNCs that have successfully entered to industrialized markets. Using a panel dataset of 22 MXTNCs over the period 1994-2015, the results of the econometric model demonstrate that the amount of Mexican outward FDI and the research and development (R&D) expenditure in host developed countries had a positive impact on the innovation capabilities at the firm and industry level. There is also evidence that management of acquired brands and the organizational structure of Mexican subsidiaries improved these capabilities. Implications for internationalization strategies of emerging countries corporations and future research guidelines are discussed.

Keywords: emerging countries, foreign direct investment, innovation capabilities, Mexican transnational corporations, reverse technology transfer

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Authors: Sittampalam Manoharan, Gary Chai, Sanaul Chowdhury, Andrew Golding

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The primary objective of this paper is to present a simplified approach to develop the structural deterioration model using traffic speed deflectometer data for flexible pavements. Maintaining assets to meet functional performance is not economical or sustainable in the long terms, and it would end up needing much more investments for road agencies and extra costs for road users. Performance models have to be included for structural and functional predicting capabilities, in order to assess the needs, and the time frame of those needs. As such structural modelling plays a vital role in the prediction of pavement performance. A structural condition is important for the prediction of remaining life and overall health of a road network and also major influence on the valuation of road pavement. Therefore, the structural deterioration model is a critical input into pavement management system for predicting pavement rehabilitation needs accurately. The Traffic Speed Deflectometer (TSD) is a vehicle-mounted Doppler laser system that is capable of continuously measuring the structural bearing capacity of a pavement whilst moving at traffic speeds. The device’s high accuracy, high speed, and continuous deflection profiles are useful for network-level applications such as predicting road rehabilitations needs and remaining structural service life. The methodology adopted in this model by utilizing time series TSD maximum deflection (D0) data in conjunction with rutting, rutting progression, pavement age, subgrade strength and equivalent standard axle (ESA) data. Then, regression analyses were undertaken to establish a correlation equation of structural deterioration as a function of rutting, pavement age, seal age and equivalent standard axle (ESA). This study developed a simple structural deterioration model which will enable to incorporate available TSD structural data in pavement management system for developing network-level pavement investment strategies. Therefore, the available funding can be used effectively to minimize the whole –of- life cost of the road asset and also improve pavement performance. This study will contribute to narrowing the knowledge gap in structural data usage in network level investment analysis and provide a simple methodology to use structural data effectively in investment decision-making process for road agencies to manage aging road assets.

Keywords: adjusted structural number (SNP), maximum deflection (D0), equant standard axle (ESA), traffic speed deflectometer (TSD)

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Authors: Muhammad Ali Asadullah, Zafarullah Amir

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In recent years, Vocational Education and Training (VET) has been under discussion by the academic researchers and remained in focus in the political grounds. Due to potential contribution of VET, the World Bank and United Nations Educational, Scientific and Cultural Organization (UNESCO) support vocational education to reduce poverty, enhance economic growth and increase competitiveness. This paper examines the impact of Vocational Education and Training on the Economic Growth and Social Inclusion with direct and mediation effect of Social Inclusion. The basic purpose of this study is to assess economic pay-offs as a result of long term investments in VET. Based on the review of Anderson Nilsson, initially we explored the increasing or decreasing trend in investment on VET. Further, the study explores that the countries which invest more on VET, tend to get more economic growth and are socially more ‘inclusive’. It is a longitudinal / panel data study with 12 years of registered data which involves 24 OECD countries. The results of the study indicate the VET has positive association with Social Inclusion and Economic Growth. Further, there is also a positive association of VET and Economic Growth through mediation of Social Inclusion. The current study considers not only issue and challenges in developing VET systems but also contributes to develop the theoretical framework for considering how VET can directly and indirectly improve economic growth and social inclusion. A wider appreciation of how VET’s benefits operate may influence a country’s decisions to invest in it. If policy makers increase investment on VET, the result would be positive in Economic Growth and Social Inclusion. It is also recommended that the same OECD model may be implemented in developing countries like Pakistan.

Keywords: Vocational Education and Training (VET), Social Inclusion, Economic Growth, OECD countries

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Authors: Taha Anjamrooz, Sareh Rajabi, Salwa Bheiry

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Selection between the available projects in bidding processes for the contractor is one of the essential areas to concentrate on. It is important for the contractor to choose the right projects within its portfolio during the tendering stage based on certain criteria. It should align the bidding process with its origination strategies and goals as a screening process to have the right portfolio pool to start with. Secondly, it should set the proper framework and use a suitable technique in order to optimize its selection process for concertation purpose and higher efforts during the tender stage with goals of success and winning. In this research paper, a two steps framework proposed to increase the efficiency of the contractor’s bidding process and the winning chance of getting the new projects awarded. In this framework, initially, all the projects pass through the first stage screening process, in which the portfolio basket will be evaluated and adjusted in accordance with the organization strategies to the reduced version of the portfolio pool, which is in line with organization activities. In the second stage, the contractor uses linear programming to optimize the portfolio pool based on available resources such as manpower, light equipment, heavy equipment, financial capability, return on investment, and success rate of winning the bid. Therefore, this optimization model will assist the contractor in utilizing its internal resource to its maximum and increase its winning chance for the new project considering past experience with clients, built-relation between two parties, and complexity in the exertion of the projects. The objective of this research will be to increase the contractor's winning chance in the bidding process based on the success rate and expected return on investment.

Keywords: bidding process, internal resources, optimization, contracting portfolio management

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Authors: L. M. Hayyan ul Haq, Lalu Sabardi

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This research is aimed at exploring an appropriate regulatory model in coherencing a diametrical interest between the state, Adat legal community, and private interests in utilising and optimizing land in Indonesia. This work is also highly relevant to coherencing the obligation of the state to respect, to fulfill and to protect the fundamental rights of people, especially to protect the communal or adat community rights to the land. In visualizing those ideas, this research will use the normative legal research to elaborate the normative problem in land use, as well as redesigning and creating an appropriate regulatory model in bridging and protecting all interest parties, especially, the state, Adat legal community, and private parties. In addition, it will also employ an empirical legal research for identifying some operational problems in protecting and optimising the land. In detail, this research will not only identify the problems at the normative level, such as conflicted norms, the absence of the norms, and the unclear norm in land law, but also the problems at operational level, such as institutional relationship in managing the land use. At the end, this work offers an appropriate regulatory model at the systems level, which covers value and norms in land use, as well as the appropriate mechanism in managing the utilization of the land for the state, Adat legal community, and private sector. By manifesting this objective, the government will not only fulfill its obligation to regulate the land for people and private, but also to protect the fundamental rights of people, as mandated by the Indonesian 1945 Constitution.

Keywords: adat community rights, fundamental rights, investment, land law, private sector

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Authors: Han Song, Tingting Wei, Dong Chen

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The combination of capital and rural areas in China has shown its great significance in promoting urban-rural integration and new-style urbanization, enhancing regional capacity for sustainable rural development and optimizing human settlement environment. The purpose of this study is to find capital operation mechanism in rural area and rural planning guidance in China. Based on case studies in Chinese rural areas, two types of capital operation mechanism in rural areas are summed up: intervention in the field of agriculture promoting the upgrading and innovation of agricultural industry chain, intervention in rural life and leisure areas updating rural connotation and form. In the light of experiences in Japan and Taiwan, it is proposed that government's norms and guidance, rural investment intensity and rural self-organization are three important factors for capital to drive rural development. It is also found that the unique land tenure and rural governance tradition are two important factors effecting the combination of capital and rural regions in China, which requires full attention in rational policy-making and rural planning. It comes to a conclusion as four directions of the overall reform of the rural planning: targeting at enhancing the viability of rural and sustainable capacity, encouraging differences in investment incentives and planning policies, providing land usage in the rural areas with planning support and reforming the village system. Directional guidance is also made for different types of capital investments, suggesting that capital should be rooted in agriculture and rural land to benefit farmers and update human settlements.

Keywords: capital, rural areas, rural planning, rural governance

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Authors: Amrita Mishra, Tushar Kanti Das

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Agriculture is the backbone of the economy of Odisha. Sustainability of agriculture holds the key for the development of Odisha. The Sustainable Development Goals are a framework of 17 goals and 169 targets across social, economical and environmental areas of sustainable development. Among all the seventeen goals the second goal is focusing on the promotion of Sustainable Agriculture. In this research our main aim is also to contribute an understanding of effectiveness of sustainable agriculture as a tool for rural development in the selected tribal district (i.e. Koraput and Malkangiri) of Odisha. These two districts are comes under KBK districts of Odisha which are identified as most backward districts of Odisha. The objectives of our study are to investigate the effect of sustainable agriculture on the lives of tribal farmers, to study whether the farmers are empowered by their participation in sustainable agriculture initiatives to move towards their own vision of development and to study the investment and profit ratio in sustainable agriculture. This research will help in filling the major gaps in sociological studies of sustainable agriculture. This information will helpful for farmers, development organisations, donors and policy makers in formulating the development of effective initiatives and policies to support the development of sustainable agriculture. In this study, we have taken 210 respondents and used various statistical techniques like chi-square test, one-way ANOVA and percentage analysis. This research shows that sustainable agriculture is an effective development strategy that benefits the tribal farmers to move towards their own vision of Good Fortune. The poor farmers who struggle to feed their families and maintain viable livelihoods on shrinking land for them sustainable agriculture are really benefited. The farmers are using homemade pesticides, manure and also getting the seeds from different development organisations and Government. So the investment in Sustainable Agriculture is very less. All farmers said their lives are now better than before. The creation of farmers groups for training and marketing for the produces was shown to be very important for empowerment.

Keywords: sustainable, agriculture, tribal farmers, development, empowerment

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