A review of evaluation studies in New Zealand agriculture & forestry

Abstract

This discussion paper sets out the main developments in project evaluation in agriculture and forestry in New Zealand. The paper includes a bibliography of the appropriate reports and the following discussion relates to the reports quoted. It should be noted that some reports quoted are in manuscript (MS) or mimeograph (Mimo) and may not be in general circulation. To facilitate discussion, the subject is divided into five different types of project; irrigation schemes, water supply schemes, drainage schemess individual farm intensification schemes, and land development schemes. Some schemes are difficult to classify, as for example comparisons of farm forestry with pastoral farming, but in the main the above five categories cover the literature and the bibliography is arranged accordingly. Considering the long history of project evaluation in the United States, it is very recent application in New Zealand merits comment. It would appear that the allocation of capital in the public sector has been decided for many years by rules-of-thumb by local and political pressures rather than by objective economic tests. It could be that economic criteria have not been considered in the public decision making area, or it could be that such rules-of-thumb have been sufficiently indicative of the economic prospects of a scheme to know when to proceed. Uncertainty introduced by fluctuating prices may outweigh precise tests of profitability. Schemes launched into a period of prosperity will tend to be regarded as successfuls and those launched just before or into a period of adversity will tend to be written off. There is little that prior evaluation can do to overcome these problems.