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This paper introduces the key principles and methods related to socio-economic and livelihoods analysis in investment planning. It includes a discussion of the importance of understanding the constraints of the rural poor in identification and preparation of investment programmes. It explains the processes of identifying the constraints of the rural poor, the extent and nature of their vulnerability, and their coping strategies in times of food shortage. In addition, it provides an understanding of the roles/functions of rural institutions and presents some methods used in community analysis. Finally, it discusses the implications of socio-economic and livelihoods analysis for the design of pro-poor and gender sensitive rural and agricultural investment projects / programmes.

This paper is part of the FAO Policy series: EASYPol-Resources for policy making (in agriculture, rural development and food security). You can find other EASYPol series' resources in the Resources section of this website, typing "EASYPol" in the free text search.