582 READINGS IN RURAL ECONOMICS 



able to have larger farms because they borrowed money were 

 making much better labor incomes than were those who farmed 

 only as much land as they could pay for. 



TABLE 5. EFFECT ON PROFITS OF ENLARGING THE FARM WITH 



BORROWED CAPITAL. FARMS WITH AN OWNED CAPITAL OF. 



$5000 TO $10,000, JEFFERSON COUNTY, NEW YORK 



-t 



Number of farms 



Average capital owned . . . 

 Average capital borrowed . . 

 Average size of farms (acres) 

 Average labor income . . . 



The same point is shown for each county in each capital group 

 up to ^15,000, With a given owned capital of less than ^5000, 

 those who use their money to farm as tenants are making the 

 most. The next most profitable way to use this amount of money 

 is to buy a farm larger than the money will pay for, leave the bal- 

 ance on mortgage, and then rent additional land. The least profit- 

 able way of using this sum of money is to buy and equip a farm 

 so small that one is not in debt,^nd then not rent any land. 



Those persons who owned over ;^ 15,000 worth of property and 

 who were not in debt made a little more than those who went in 

 debt for additional property. This amount of capital gave them 

 farms of 237 acres in Jefferson County and of 230 acres in 

 Livingston County. This agrees with the discussion on size of 

 farm in the following pages, where it is shown that if one has a 

 small farm, additional acreage is of very great importance, but that 

 after 200 acres is passed more land may be desirable but. is not 

 so necessary. 



One important point not shown in Table 4 is the profit due to 

 rise in land values. If land is likely to rise in price, it may pay a 

 tenant to invest his money in land even though his labor income 

 is much lower than it might be as a tenant. Rising land values 

 are not included in labor income. Ways of farming with small 

 capital are discussed in Bulletin 295 of this station. 



