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to cereals are actually owned by the men who farm them, 

 which means that only few of our farmers have found it 

 convenient or possible to invest capital in acquiring land, 

 into the majority of our farmers' calculations neither 

 land nor houses enter, when he speaks of capital. In near- 

 ly every case a part of the farmer's capital is represented 

 by the barns, "galpones'', fencings, "tinglados", which 

 he puts up for his own use exclusively, and generally in 

 such a. way as to be removed with the rest of his posses- 

 sions when he quits ; a contingency never very remote 

 in his idea. 



Capital, as represented in the case of 70 per cent, 

 of the cereal farmers, is of dual origin ; that represented 

 in fixtures is contributed by one party, the land owner, 

 that represented by movables and propelling energy is 

 supplied by the second party the farmer, or tenant. 



It represents the classical combination of the sure 

 investment with the hazardous one. 



DUAL CAPITAL. 



In the majority; then, of our agricultural undertak- 

 ings, one party prefers to invest his capital securely 

 he owns the land, and to get a small but sure interest on 

 his investment in the form of a fixed rent, usually pay- 

 able in advance, while the other party prefers to risk all 

 his capital, investing it in cultivating the land, and get-. 

 ting 1 , if he can, a correspondingly high rate of return, or 

 profit, one is compensated by the security of the rent 

 paid, the other by the exceptional good profit, if the 

 year turns out favourable. 



It is true, we find all the varying combinations of 

 participation in the final results of the years trading. 

 Although, in general, the tenant prefers to take the 

 whole risk, confiding undoubtedly in the compliance of 

 the other party in case of disaster, in a small percentage 

 of cases (the system of "medieros", which rules on 5 

 per cent, of the farms growing cereals, ) the owner of the 

 land prefers to forego the small but sure interest on his 

 capital, and accepts the risks of cultivation, agreeing to 

 take as rent a proportional share of the year's produce, 

 but limiting his possible loss to that of the prospective 

 rent . 



The payment of rents is generally stipulated in mo- 

 ney, but it is also common practice for the owners of the 

 land to participate in the risks of ^he business by accept- 

 ing part payment in kind, according to the final results 

 obtained . 



