S IMULATION-a systems analysis approachcan provide a comprehensive view of a complex system [3, 5, 7,9, 10, 11,16,17,24,29]. In development planning we are interested in studying and approximating, via a mathematical model, those relationships within the economy that are important in the development process. By translating this model into a computer .language, the likely end results of alternative development schemes can be evaluated through manipulation of the specified computer simulation model.We are interested in exploring this approach to development planning because it might provide a more informed basis for planning development [12,13]. The design of development, or planning, is especially important in less developed countries because they usually have comparatively few funds available relative to their apparent needs. Consequently, allocation mistakes appear to have a somewhat greater opportunity cost in terms of human well-being in the underdeveloped setting.Planning in any country is a process fraught with uncertainty. Frequently, there is uncertainty about likely immediate and longer range effects of development strategies. Further, the degree to which policies aimed at one set of economic phenomena may have unintended side effects on other aspects of the society is often uncertain. The paucity of information available for decision making is often cited in developed countries, with even more frequent mention in less developed countries. Poor communication facilities, especially prevalent in LDC's, often impede the accumulation of potentially available relevent information which might otherwise provide a reasonably well-informed basis for decision making. Given these difficulties and uncertainties, let us consider the utility of a systems analysis ap-*This paper was developed under research contract with the U.S. Agency for International Development. The order of authorship does not imply degree of contribution; the authors are members of a research team at Michigan State University. A. N. HALTER is visiting professor of agricultural economics, M. L. HAYENGA is assistant professor of agricultural economics, and T. J. MANETSCH is associate professor of systems science, all at Michigan State University.272 proach-simulation-in studying the dynamic interactions among variables affecting the rate of development and in subsequently planning development.A systems analysis approach attempts to isolate and formulate into a mathematical model those sectors and components of the economy and those physical, biological, economic, and social relationships within them which are most important in affecting the development effort. The systems analysis approach, in the development context, emphasizes those relationships that can be affected by or are vital to the evaluation of either public or private development policies. In the process of formulating the simulation model, relevant information is gathered and incorporated into the model. It is then available for analyzing alternative development strategies and assistin...
