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<br />I <br />," <br />! . <br />:." <br /> <br />. <br /> <br />15 <br /> <br />3. Shadow-pricing labor. A practical guideline for shadow-pricing <br /> <br />inputs has been given by Havanan aryj Krutilla (1968): <br /> <br />In the case where long-teJ:m unenployed resources <br />will be used in the coostruction or operation of <br />a project, ... Ill.Iltiply each class of costs by 1.0 <br />minus the prd:labili ty that the inputs will be drawn <br />fran the ranks of the UI1E!lployed. <br /> <br />'lhis principle has been applied to the enployment of J\merican Indians in <br /> <br />activities served by the Project. IDng-teJ:m unenployment am:mg J\merican <br /> <br />Indians is very high. '!he practice is to count the incane of such otheJ:wise <br /> <br />UI1E!lployed labor as a project benefit rather than as a reduction in cost because <br /> <br />of legal obligatioo of users to repay various percentages of actually incurred <br /> <br />costs. <br /> <br />B. Evaluatioo of the Benefits aryj Costs of Each Project Purpose. <br />1. llgricultural benefits. llgricultural yields are projected using a <br />positive trenl to a point 20 years beyond the developrent period. Those yields <br /> <br />are then used in the evaluation of the project. FurtheJ:more, the trends are <br /> <br />established by usin:J the experience of the top 25% of similar fanns in the <br />regial, 00 the grounds that these practices will be copied aryj becane the <br />standard of the future. <br /> <br />While such assutptions may be awropriate in sane settings, these matters <br /> <br />should be carefully stuiied in each case. In the U.S., the assunptions have <br /> <br />been used in the analysis of cases where regional experience has shown no up..iard <br />trenl in yields. '!he assurptions are also inconsistent with those used in cal- <br /> <br />culating the fanrers' "ability to pay", calculations on which the repayment <br />