97] ECONOMIC WORKINGS OF ThE SYSTEMS gy 



Again, the fact that there are migrations of labor and 

 capital from one system to another indicates the opera- 

 tion of fundamental static laws, but the slowness of these 

 movements suggests the presence of obstructions in the 

 way of their easy operation. In addition, therefore, to 

 pointing out the alignment of economic forces being 

 wrought out in obedience to static principles, it is de- 

 sired to indicate the elements of friction which hinder a 

 more rapid realization of the best combination of the 

 forces. 



The first element of friction to be considered is the 

 risk 1 incident to farming. Particular reference is now 

 made to the risks involved in efforts directed toward an 

 efficient combination of the productive factors, rather 

 than to the casualties arising out of the uncertain action 

 of physical nature — that is to say, reference is now made 

 to the risks over which man has some control, rather 

 than to those over which he has but slight control. Be- 

 fore beginning a detailed consideration of the former 

 risks, however, a word should be said concerning the 

 manner in which the latter work. 



An excess of rain, or a drouth, or some other unfavor- 

 able influence of nature may subject the return to a given 

 expenditure of labor and capital to a very considerable 

 curtailment, as compared with the return realized under 

 the action of favorable seasons. It may be said, how- 

 ever, that such risks as these apply to all the farming 

 systems under consideration, and tend, therefore, to 

 exert a deterrent influence upon the flow of labor and 

 capital into the farming industry as a whole, in so far as 

 other, less risky, industries are open to them. This may 



1 For an admirable discussion of the economic nature of risk, cf. Wil- 

 lett, The Economic Theory of Risk and Insurance, 



