218 WHEAT PRODUCTION IN NEW ZEALAND 



gross negligence if he has no accurate idea of what his 

 yearly outlay is for each particular crop. The fact is 

 that a great majority of our farmers keep only meagre 

 records of receipts and expenditure. Among them are 

 to be occasionally found some who can give a reliable 

 estimate of the cost of producing a crop, but in the vast 

 majority of cases the pursuit of such information is 

 fruitless. It is a matter for regret that some sound 

 system of farming accounts has not been adopted by the 

 farming community generally. 



The writer is well aware of the controversial nature 

 of the problem of "Cost of Production" in relation to 

 the wheat industry. The controversy which has led in 

 recent times to an increasing number of public statements 

 on the problem from a variety of sources, reveals all the 

 faults and inconsistencies which characterise popular 

 discussions on economic questions. Few, if any, of the 

 participants in the discussion have attempted to envisage 

 the problem at the outset, but most have chosen for their 

 criticisms questions of minor importance, and even then 

 they have not considered these in relation to the question 

 as a whole. 



2. The Meaning of Cost of Production. 



It is necessary to state clearly what is meant by 

 "cost of production," as the phrase will be used in 

 this investigation. Professor Marshall defines cost of 

 production of an article as follows: "The exertions of 

 all the different kinds of labour that are directly or 

 indirectly involved in making it, together with the 

 abstinences, or rather the waitings required for saving 

 the capital used in making it: all these efforts and 

 sacrifices together will be called the real cost of pro- 

 duction of the commodity."* 



*MarshalPs " Principles of Economics. ' ' Page 339. Sixth 

 edition. 



