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Increasing the growth and efficiency of the agricultural and rural sectors of the developing countries is of prime concern to the international community. The large quantities of scarce resources, both people and money, that will be required for progress in this area must be used efficiently. In view of this, the book presents a sound, careful methodology for project analysis. The process is interactive, going back and adjusting earlier decisions based on what is learned. The sequence of topics presented generally follows the order of the analytical process in preparing a financial, and then an economic, analysis of an agricultural project. It does not consider in detail the technical, institutional, social, or commercial aspects. The following topics are examined: (i) costs and benefits; (ii) finding market prices; (iii) transforming these prices into accounts; (iv) preparing and projecting farm budgets; (v) preparing and projecting budgets for agricultural processing industries; (vi) estimating the effect on government revenue; (vii) adjusting market prices; (viii) aggregation of economic values; and (ix) estimating returns to be realized by individuals and by society. A set of generalized guidelines is included.
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