﻿2 BULLETIN 3, U. S. DEPARTMENT OF AGRICULTURE. 



to secure the greatest profit without impairing the efficiency of any 

 factor of production. In attempting to bring about and maintain 

 this profitable adjustment, every farmer consciously or otherwise 

 utilizes and is limited by physical and economic factors peculiar to 

 the farming business. 



From the investigational viewpoint, the individual farm with its 

 cropping system, practice, equipment, current operations, and general 

 organization is a means to an end, and farm management is concerned 

 with the farm unit only in so far as it affords impersonal data from 

 which general principles can be formulated and applied to farms of 

 its type and the conditions and possibilities of its locality. For 

 purposes of investigation as well as use, the elements of farm equip- 

 ment which affect the management of farms have been considered 

 in two classes, which are here briefly referred to and defined in order 

 to develop the relation between the science and practice of farm man- 

 agement and the subject matter of this bulletin. One class of ele- 

 ments relates to the investment in equipment and the other to the 

 operation of equipment, the first being termed " investment factors" 

 and the second " operating factors." Operating factors are further 

 classified into "seasonal" and "daily" factors. 



INVESTMENT FACTORS. 



By assembling masses of data from many farms, covering either 

 the entire organization of each or selected elements only, useful facts 

 and factors not previously known can be made available. As a com- 

 paratively simple illustration, let it be assumed that it is necessary 

 to determine the optimum investment to be made in outbuildings 

 for a certain 200-acre farm. It is not safe to depend upon direct 

 mathematical calculation on the basis of the physical needs for farm 

 storage, since the investment is limited by the farm income and the 

 physical demands must be to a certain degree subordinated to the 

 economic. Neither would it be wise to depend upon the example of 

 but one practical farmer who had recently decided the matter for 

 himself, since the individual must have had but little information to 

 guide him and may have made serious errors, such as building in a 

 year of big crops and investing so much that his farm pays no inter- 

 est on the expenditure, or he may have been compelled to build in a 

 "lean" year and may have invested so little as to be unduly cramped 

 for space and may be incurring losses through damage and inconven- 

 ience. 



If, however, many 200-acre farms in an area are examined, a nor- 

 mal investment factor, representing a considerable period of time and 

 typical of those farms which are both physically adequate and finan- 

 cially solvent, can be taken as the optimum factor desired. Simi- 

 larly, the distribution of investment in all classes of equipment can 



