MICHIGAN ACADEMY OF SCIENCE. 59 



We cannot make any direct comparison between the amount of profits received 

 by the industrial entrepreneur and the farm entrepreneur. However, it iS" 

 probably safe to conclude that the margin of profits is greater in the former 

 case, while, at the same time, the percentage of failures is higher. In general, 

 the latter affords the greater opportunity of fair success, although the profit 

 is much less on the average. 



Third, the incomes of tenant farmers are on the increase, and in general, 

 the wages they receive correspond roughly to the gross income received by the 

 farm owner. Furthermore, the wages of farm laborers are increasing for 

 reasons already given. 



Lastly, from a theoretical standpoint, the average gross income received 

 by farmers in the United States consists primarily of a remuneration composed 

 of wages of labor and wages of management plus interest on the investment. 

 Deducting the small sum representing the interest on the investment, the net 

 income is primarily a labor income. However, in cases where the functions of 

 management and risk-taking are distinctly separated, and in instances where 

 there has been a rapid increase in land values, the element of pure profits 

 becomes more noticeable. 



Thus, the tendency during the last few years has been by no means 

 unfavorable to the farmer, but on the other hand, it has been decidedly favor- 

 able, especially during the recent war. There is no doubt that there were 

 many farmers who were receiving excessive profits, perhaps more in propor- 

 tion to numbers than those engaged in other industries — that is, as a class, 

 farmers were receiving excessive profits more generally than any other single 

 class. However, this is no condemnation of excessive profits. In general, 

 they are justifiable as a reward for unusual risks and abnormal responsibili- 

 ties. The point to be made is that the lot of the farmer is improving and that 

 profits are becoming a more important element in the farm income. 



University of Michigan, 



