Conclusion

How useful is it, ultimately, to apply economic concepts to research planning? If priority-setting exercises are costly and time-consuming, are they worthwhile? Do they increase research output sufficiently to justify their costs? Ruttan notes that agricultural research typically displays very high rates of return in ex post evaluations. Given these returns, he asks whether the resources devoted to priority setting would be better allocated to research.1 These are difficult questions. Even "unimportant" research may generate some benefits, and it seems to be true empirically that "more research is better." But the real cost of misallocating research funds is that the best projects will be underfunded. Suppose that priority setting allows research administrators to transfer funds from the least productive project in their portfolio to the most productive. This is a direct gain. Given the magnitudes of the benefits that emerge from agricultural research, it might not take many transfers of this type to pay for the costs of priority-setting studies.

Whether or not a research organization undertakes formal priority-setting activities, the concepts embedded in priority setting are useful. Even if the priority-setting process is an informal one, with no data collection and no survey of expert opinion, it can provide a useful discipline for resource allocation. Research planners need to ask at every juncture where the expected payoffs from research are greatest. They should consider the demand for research—driven by the importance of different crops and commodities—and also the supply.

At the dawn of a new century, with rapidly changing technologies, with new and different research needs, and with research funds ever tighter, it will be vital to manage research effectively. Priority setting can play a useful role in pointing out critical areas for agricultural research.

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