CHAPTER V 



DISTRIBUTION OF THE AGRICULTURAL INCOME 



The income of the agricultural classes. By the agricultural 

 income is meant that portion of the gross product of the 

 farms which goes, as compensation or income, to those who 

 are directly connected with them. In other words, it is the 

 total farm value of all products after deducting the cost of 

 all such factors of production as commercial fertilizers, tools, 

 machinery, etc., which are not themselves produced on farms. 

 More specifically, this agricultural income includes the wages 

 of farm labor, the rent of farm land, the interest on the capi- 

 tal invested in live stock, tools, machinery, etc., employed on 

 farms, and the profits of farming. It is obvious that the agri- 

 cultural income includes more at one period than at another. 

 At one time, for example, all the labor involved in the growing 

 of crops was performed on the farms. Now a part of it is 

 performed in the shops where farm machinery is made. 



Though it is customary in the United States for the functions 

 of laborer, landowner, capitalist, and manager to be combined 

 in the same person, yet it is possible, even in such cases, to 

 divide the farmer's income into the four parts just named. The 

 farmer sometimes hires all his manual labor, frequently a part 

 of it; ; sometimes rents all his land from another, frequently a 

 part of it ; and sometimes borrows all his capital, frequently a 

 part of it. In view of the wide variations of practice in these 

 particulars, it is simpler and less complicated to divide the 

 whole farm income into four parts, wages, rent, interest, and 

 profits, even when they all go to one and the same person. 



