Recent food crises and growing concerns about global climate change have placed agriculture on top of the international agenda. Decision-makers have recognised the strong link between the dual goals of eradicating hunger and making agriculture sustainable. Achieving these goals will require a significant increase in agricultural investment but, more importantly, it will require improving the quality of this investment. This annual flagship report by the Food and Agriculture Organization (FAO) reviews the economic and social rationale for agricultural investment, examines the causes of underinvestment, and presents evidence showing how public resources can be used more effectively to catalyse private investment, especially by farmers themselves, and to channel public and private resources towards more socially beneficial outcomes. The focus of the report is on the accumulation of capital by farmers in agriculture and the investments made by governments to facilitate this accumulation.