FARM ACCOUNTS 133 



the application of certain methods and of certain 

 scientific discoveries to the land. This should be the 

 great work of the Agricultural Costings Committee 

 already referred to. 



It is quite impossible to make guesses in regard to the 

 law of diminishing returns. This economic law has an 

 important bearing upon agriculture, for there is a point 

 in production beyond which it does not pay to go ; 

 but it is not an immutably fixed point. Let us take a 

 concrete example : supposing the yield of wheat to be 

 30 bushels per acre — at which it gives a profit of, say, 

 £2 per ^cre — in the interests of agricultural development 

 we should like to increase that yield to 40 bushels per 

 acre. If the money spent in higher cultivation, to secure 

 the increase of 10 bushels, is more than covered by the 

 value of the increase then clearly it is good business. 

 But if the cost of producing those 10 bushels exceeds 

 their value, then from the farmer's point of view it is 

 bad business. 



If it were our object to produce an increase of 20 

 bushels instead of 10 bushels, although we could do it, 

 we should find that the profit (if any) would be less on 

 the second 10 bushels than on the first. Or, looking at 

 it from a somewhat different point of view — if the 

 application of 20/- worth of artificial manure per acre 

 leads to an increased yield in grain to the value of 30/- 

 per acre, it is a paying expenditure ; but to spend 50/- 

 upon artificials and obtain an increase of, say, 40 '- 

 worth of grain would be uneconomic. 



Only by the proper and scientific book-keeping of 

 " demonstration production," can we find out at what 

 point the law of diminishing return becomes active. 



It is noticeable that, while in this country we 

 stand much in fear of this law, on the Continent 



