The rationale for private sector provision of agricultural extension services is generally based on an expectation of increased efficiency with the operation of private markets and with the resulting efficiencies contributing to the growth of a country's GNP. In contrast, the rationale for public provision of agricultural extension services is based on the following points: (1) much agricultural information is a public good; (2) only government extension services are likely to promote concern for natural resources management; (3) public sector extension may enhance the education of farmers who often lack adequate access to educational institutions; (4) the public service often provides information that reduces risk to farmers; (5) the service may provide information that reduces transaction costs; and (6) an extension service may be concerned with community health issues related to possible human hazards such as accidents and poisonings linked to agricultural chemicals.

The argument for privatization is based upon:

• More efficient delivery of services

• Lowered government expenditures

• Higher quality of services

Privatization may have some attendant disadvantages because of unequal access to resources and because of a diversity of "agencies" and the associated difficulty of coordinating external groups and other government departments. Private delivery agents will be less responsive to government policy direction, and there may be linkage problems with public applied research organizations.

 

While the process of information transfer amongst farmers traditionally has been characterized by a cooperative, free exchange of information, industrial information traditionally has been a private good characterized by patent rights, process licensing, the use of paid consultants, and differentiated production and marketing processes. In developed economies with commercialized agriculture sectors, many of these features of industrial information transfer are becoming more common in agriculture. The trend to privatization will be stronger the more such circumstances exist. The range of different circumstances prevailing in agricultural extension worldwide suggests that a wide variety of approaches should prevail.