Investments in agriculture : a synthesis of the evaluation literature

Over that time, the Agency has invested substantial resources in the five main agricultural subsectors: economic policy reform and planning (such as budget support for policy reform); technology development and diffusion (research, education, extension); rural infrastructure (irrigation, rural roads); agricultural services (credit, crop storage); and asset distribution and access (land tenure and reform, local participatory institutions). This desk study assesses the success and failure of these investments, focusing on what needs to be done, and who should do it. Two overarching conclusions emerge. First, a country"s predisposition to agricultural development is key to success, whether or not this commitment is linked to donor investments. Second, the main bottlenecks to agricultural growth are most likely to be inadequate policies, technologies, and rural infrastructure; they are least likely to be services and asset distribution. The study also finds that the United States may have an advantage over other bilateral donors in providing assistance in policy reform and planning, but there is no empirical evidence that the United States has an advantage in providing assistance in agricultural research. The study offers the following five recommendations, one for each of the agricultural subsectors. (1) USAID should provide nonproject assistance (such as cash transfers) to support economic policy reform only in countries where it will be used to facilitate policy reform processes already underway. (2) Research and development for new agricultural technologies typically have had a high economic rate of return and are essential to sustained economic growth. (3) Donors should consider investing in new rural infrastructure and, if justified by economic analysis, in maintaining existing infrastructure as well. (4) Most investments in agricultural services are best left to the private sector. (5) Most investments in programs to improve the distribution of land and other agricultural assets are best left to the public sector. (Author abstract, modified)