Naturally, the operators' capital was greater where the operators owned their 

 farms. The operators of rented farms had no capital in land and buildings. As 

 the renters had greater acreage, they secured greater total farm receipts; but 

 total receipts per acre were greater in case of the owned farms. 



The owner's interest on investment at 7% was greater than the average rent 

 the lessees paid to their landlords by about $700.00. The amount paid in rents 

 equalled 4.5% of the value of the farms that were leased. In comparing the 

 labour incomes of the two groups, when interest on operator's capital was allowed 

 at 1%, the lessees had the advantage by about $700.00. The difference is counter- 

 balanced by the increased interest rate allowed on owned farms as compared with 

 the total rent that lessees paid. When interest on owned farms was calculated 

 at the same rate that the lessees paid in rent, the labour income on the owned 

 farms is just over $200.00 practically the same as was secured on rented farms. 



It would seem from Table No. 15 that, if one were to start farming, 

 the question of renting or buying would be one depending upon the amount of 

 capital on hand. If one had capital of his own, or could secure money at 4.5%, 

 he would be well advised to buy. If a higher rate of interest were demanded 

 for cash with which to make the purchase, the prospective farmer might do well 

 to rent for a few years rather than to buy immediately. 



AVHAT INTEREST ON INVESTMENT DID OWNED FARMS RETURN? 



When wages were allowed to operators at the rate of $80.00 per month, and 

 $50.00 per month to such partners as were engaged along with the operators in 

 the farming operations, this investigation shows that, during the crop year of 

 1920, the farms paid interest on capital invested at the rate of 1.9%. Had 

 operators and joint operators been allowed wages at $500.00 per year for their 

 labour, along with free house and farm products used in the house, the rate of 

 interest on capital invested would have been 3.8%. This is the rate that owned 

 farms returned in 1919. In other words, the farming operations were not quite 

 so successful for the crop year of 1920 as they were for the crop year of 1919. 



THE EFFECT OF SPECIALIZATION IN DAIRYING ON FARMS OF 



VARIOUS SIZES. 



Table No. 16. 



12 



