| By A.Bebbington and O. Sotomayor | Published in the Journal of International Development, vol. 10 (1): 17-34 |

Abstract: In the search for alternatives to state‐managed agricultural research and extension, there has been much interest in assessing the pros and cons of, and the mechanisms for, varying forms of private sector involvement. One experience of privatization that has received much attention has been that of Chile, which has the most privatized and market‐oriented national system for technology transfer in Latin America. This paper suggests that this Chilean experience reveals both advantages and also limits of voucher and contract‐based forms of privatization of rural services, and demonstrates that there continues to be an important role for state investment and co‐ordination alongside private sector involvement. It also suggests that there is only limited evidence that this form of privatization has had a positive impact on farm incomes or on enhancing the extent to which services are demand led. The paper also notes that there have been very special circumstances in Chile that have helped consolidate this model. Attempts to transfer the model elsewhere ought therefore to be made with caution.