AGRICULTURAL ECONOMICS 



ment for the use of the land and capital-goods, 

 and the payment of the wages of hired laborers 

 have been made. 



Having decided upon the branch of agriculture 

 which he is to follow, the grade of land, capital- 

 goods, and laborers which he is to employ, the 

 kind of crops which should be grown, and the 

 proportions in which these factors should be 

 brought together and the amount of managerial 

 activity which should be devoted to each unit, the 

 farmer has yet to determine how many of these 

 composite units he should attempt to manage. 



If the farmer could increase the number of 

 these composite units indefinitely without any 

 increase in the work of management, and, at the 

 same time, without any reduction in the quality of 

 the management, and hence, without any reduction 

 in the average net return per composite unit, there 

 would be no limit to the size of the farm nor to 

 the total net profit which he could win. This is, 

 of course, impossible. The supposition is made 

 to emphasize the fact that it is the increased 

 amount of effort which the farmer must put 

 forth, and the tendency towards a decline in the 

 efficiency of his management after the farm has 

 reached large proportions, which set the limit to 

 the size of the farm. 



The principle which should be followed in at- 

 tempting to determine the number of composite 



units made up of the proper proportions of land, 

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