Department of Agricultural Economics and Extension (AEE); University of Zimbabwe
Abstract
AEE Working paper.With the increasing scarcity of public funds for agricultural research - agricultural research as a percentage of GDP is falling - pressure is being placed on research managers to justify their expenditures, Budget reductions are resulting in reduced farm demonstrations and inappropriate combinations of researchers/technicians. The research strategy of "yield and quality" has been successful for many agricultural research institutes in the past. Improved performance of agricultural research institutes can be achieved by selecting alternative research programs and projects using benefit/cost (B/C) criteria.
Ex ante benefit/cost analysis can be used as an investment criterion to select research and demonstration activities with potentially high investment returns. Ex post or historical investment analysis is useful but is not directly relevant for identifying current high pay-off research projects and programs. The ex ante benefit measure focuses on improvements in future farm financial gross margins for small farmers resulting from current research/and demonstration activities. The time, travel and other costs associated with a given research and demonstration activity by agricultural researchers and extension staff are considered as a capital investment cost: on an incremental project basis
