Defining practical guidelines for evaluating long-term, smallholder decision-making in developing countries

ISBN: 1 86320 338 9

Publication number: IAP-WP44

Publication date: 2002

Summary

Upon developing a new agricultural technology, national agricultural research services (NARS) and international agricultural research centres (IARCs) need to determine whether the innovation will provide long-term, sustainable benefits to their targeted stakeholders, usually smallholder farmers in developing countries. To determine this, researchers employ privatge investment analysis to assess the net benefits to smallholders of adopting the new technology. Private investment analysis often includes that investments with distant future benefits, such as resource conservation, pasture improvement and livestock breeding programs, are not profitable because the short-term cost outweigh the long-run benefits. Yet it is not uncommon to find smallholders making long-term investments of this type. This apparent contradiction between investment analysis and investment behaviour suggests there may be flaws in the methods used to assess private investment decisions in such contexts.