Completed Smallholder hillside agricultural production systems are extremely vulnerable to soil erosion and land degradation. Yet, especially in South and South East Asia, they offer some of the greatest potential for increasing production and developing sustainable land use. Donor and government funded interventions have met with only patchy success in realising this potential (Hudson 1993). For interventins promoting soil conservation to achieve greater success it is necessary for economic analysis to incorporate the perspectives of farmers and for it to relect the rationally of farmers for engaging in soil conservation. The development of cost-effective methods of needs assessment that can be used to identify development opportunities and problems and enable the packaging and promotion of economically viable land, soil and water management techniques. Biophysical techniques and socio-economic methodologies for the assessment of soil erosion and conservation have been developed, tested, validated and applied to two target countries - Sri Lanka and Bolivia. The key lessons learned from this project are that biophysical assessment techniques for rapid assessments of erosion are widely applicable in hillside environments. Field-based techniques were found to have important practical advantages. "Investment appraisal" was found to be a useful and accessible means of assessing the economic viability of a conservation technology, with potential applicability to other soil and land resource management issues. A systems analysis framework for examining soil erosion and conservation in the context of the household.Guide to data sources from which information can be obtained rapidly on the biophysical effects of erosion and conservation.Comparative assessment of different approaches for the economic analysis of soil erosion and conservation, to include recommendations of measures that may be adopted in order to incorporate the perspective of smallholder farmers.The findings of the project tested and evaluated in another environment.Dissemination of the findings of the project. A systems analysis framework for examining soil erosion and conservation in the context of the household was developed. A review of methodologies for economic analysis of soil erosion and conservation was published. For the first time, a clear distinction was drawn between ,resource-value, approaches (ie: valuation of the depletion of nutrients and/or other measures of soil quality by erosion) and ,production-value, approaches (ie: loss/gain in yield with erosion/conservation).A guide to data sources was developed from which information can be obtained rapidly on the biophysical effects of erosion and conservation. Variables and indicators for biophysical and economic assessments were also developed, for field use by developing country professionals.Different approaches for the economic analysis of soil erosion and conservation were comparatively assessed to include recommendations of measures that may be adopted in order to incorporate the perspective of smallholder farmers. Following from the comparative evaluation, a recommended ,investment appraisal, approach has been developed, tested validated using developing country professionals.The findings of the project were then tested and evaluated in another environment. Two training workshops in Sri Lanka and Bolivia and a separate follow-up study were undertaken. The assessment methods developed by the project largely show the rationality of both practices, and the conditions under which farmers choose one practice or the other.