MANAGEMENT 28 1 



important factor in the agricultural rebirth of these two countries. 

 In E>enmark, where it has had its highest development, it is based 

 upon a remarkable spirit of friendliness and mutual helpfulness 

 amoig the farming population. A group of neighbors will or- 

 ganise a cooperative bank, electing a president and a board of 

 directors. The only one to receive a salary is the one who is 

 responsible for keeping the accounts. He usually receives $150 

 a year. This salary and the necessary office expenses are paid 

 out of the profits of the bank. These profits are simply the differ- 

 ence between the rate of interest which the bank pays for the 

 money it borrows and the rates which it receives from the money 

 which it lends. Since expenses are very low, one half of one per 

 cent difference in these two rates is usually sufficient. If any- 

 thing is left over after paying the necessary expenses, it is spent 

 for some common or public purpose. The bank is open to re- 

 ceive deposits and to make loans on regular dates, usually twice 

 a month. On these days some member of the board of directors 

 is present, but these directors serve without compensation. 



It is the opinion of those experts most closely acquainted 

 with the Raiffeisen and the Schulze-Delitzsch systems that 

 neither is specially adapted, without considerable modification, 

 to conditions in the United States. It is possible that the 

 Raifi'eisen system might be of use in a few cases where there 

 are very poor and struggling farmers. But the principle of 

 unlimited liability would absolutely prevent its being even seri- 

 ously considered by fairly prosperous, property-owning farmers. 

 Thai is to say, a farmer who owns considerable property would 

 not enter into any scheme where all his property would be 

 liable for the debts of the organization should it become insol- 

 vent. Among a few very poor farmers, no one of whom owns 

 more than a very few hundred dollars' worth of property, and 

 all of whom are about equally wealthy (or poor), the principle 

 of unlimited liability is essential in order to secure credit on 



