Everyday economic errors by Haney Lewis Henry

Author:Haney, Lewis Henry. [from old catalog]
Language: eng
Format: epub, pdf
Tags: Economics
Publisher: Austin, Tex., University of Texas
Published: 1912-03-25T05:00:00+00:00

2. Undigested Land.

But this is not the only error which our self-sacrificing' farmer may be committing. We hear much of undigested securities in connection with crises in Wall Street, but less often direct our attention to the rural digestive tract. Now in order to get the largest net return or rent from a given area of land, it is necessary to push its cultivation on past the point when returns begin to dimmish relatively to expenses of cultivation, up to the point where the last bit of expenditure in labor and capital just pays for itself. As long as a man can clear anything by tilling his land more intensively he is failing to get the maximum return. Suppose, now, that our friend has 160 acres of land, but only enough capital to work eighty acres intensively, that is, he has only enough farm animals, plows, buildings, and working capital to cultivate eighty acres with such care that they are made to yield the maximum return. But in the pride of ownership he holds his 160 acres and spreads his labor and capital out over them as well as he can, farming very "extensively.'' Once more he stands convicted of error; undoubtedly his most profitable course, considering the present, would be to sell say forty or fifty acres and invest the proceeds in tilling the remainder intensively or to sell eighty acres and put the proceeds out at interest. Thus he would get the maximum return from the labor, land, and capital in his possession.

Of course, we note that where land values are rising the extra eighty acres may be held as a speculation with the expectation that the increased capital value will offset the failure to farm most economically. Nevertheless it is the fact that many American farmers are suffering from undigested land. We have inherited the idea of large farms and extensive cultivation from a day when land was cheap and labor and capital relatively abundant. Now, with rising land values the day of intensive cultivation is at hand, and land must be more and more carefully tilled in order to secure its maximum value product. The large farm will soon be not one of many acres but one of much capital.

We conclude, then, that here are two cases in which men every

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