AGRICULTURAL ECONOMICS 



possible for farmers to accumulate wealth and to 

 become the owners of farms. It is true, certainly, 

 that the more efficient may live much better than 

 the least capable, or marginal farmers, and thus 

 the habits of life may reduce the power of the 

 more efficient farmers to save from their profits. 

 But the condition which gives rise to this differ- 

 ential gain certainly makes it profitable for the 

 more efficient tenant farmers to buy land. 



The greater the number of those who have 

 gained a degree of efficiency above that of the 

 marginal farmers and the greater the difference 

 between the degree of efficiency of the majority 

 of farmers and that of the marginal farmers, the 

 greater is the differential gain which will go to 

 farmers as personal profits, and the better able 

 they will be to become landowners. On the other 

 hand the more homogeneous the farmers who sup- 

 ply the market, that is, the smaller the number 

 who have gained a degree of efficiency above that 

 of the marginal farmer and the less this degree 

 of difference, the smaller is the total differential 

 profit and the less able are tenant farmers to ac- 

 cumulate sufficient wealth to buy a farm. 



Section IV. Credit. It is a common practise 

 in the United States for farmers to borrow money 

 to invest in land. When a young man has saved 

 enough money to pay some share, say half or two- 

 thirds of the price of the farm, he borrows the 

 remainder and makes an investment, a mortgage 

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