RICE RATOONING - IRRI books - International Rice Research Institute

28 RICE RATOONINGwhere Pab = subjective expectation of obtaining benefit Ba. (If the researcherbelieves there is a 50:50 chance of increasing ratoon yields on 100,000ha from 1.5 to 1.8 t/ha, then Pab is 0.5);j = first year of benefits derived from the research, given research investmenta;Ba = estimate of benefit which the national economy (or the farmers) willderive in a given year as a result of the application of results fromresearch alternative a. B measures net crop benefits, i.e., additionalvalue (100,000 × 0.3 × rice price minus value of additional inputs);r = rate of discount;n = years with benefits;m = years with costs;Pac = expectation of having a cost, c, amounting to Ca in year i (n > m);i = years of research expenditure; andCa = cost of research alternative a in year i.If Ka is positive, then research investment a is profitable. However, thebenefits of research alternative a should be compared with the benefits of otherresearch alternatives. The optimum research strategy will be the one with thehighest K.Normally, this will imply a mixed research portfolio. If there is only oneresearch alternative, then the optimum investment level would be whenwhen D Ka = D Ca or when D Ka/ D Ca = 1.0where D Ka = the increment in expected net benefits, givenD Ca = the increment in investment cost.If funds are scarce, the ratio will be D Ka/D Ca > 1.0.In practice, there may be a number of research alternatives, with differentadded benefit to cost ratios. For example,D Ka/ D Ca = 2.0D Kb/ D Cb = 1.5D Kz/ D Cz = 1.2In this case, more research funds might be invested in alternative a than in alternativeb to push the ratio toward alternative z. When research funds are limited, it isoptimal to allocate funds in such a manner that the ratio of added benefits to addedcosts is equal between investment alternatives. In the above example, this wouldimply spending less on z and more on a.Research in general is highly uncertain. It is rather courageous to estimateP — particularly Pab — because budgets, and therefore costs, are often determinedoutside the system at levels lower than researchers would choose. But in fact,most agricultural scientists do have some idea about the chances for success ofresearch alternatives and an estimate of the time involved. If the statement thatratooning is a complex trait is correct, it may be difficult to make progress, in whichcase Pab may be quite small.