16 BULLETIN 492, U. S. DEPARTMENT OF AGRICULTURE. 



RELATION OF TENURE TO PROFITS. 



The " farm income " is the difference between receipts and ex- 

 penses; in other words, it represents the combined earnings of the 

 capital and the operator's labor. The "labor income" represents 

 the amount the farmer has left for his year's labor after deducting 

 from the farm income 5 per cent interest on the capital invested. In 

 addition to the farm income, each of these farmers has the benefit 

 of house rent, wood for fuel, and what the farm furnishes toward the 

 family living. 



A serious defect in the system of farming followed by many farm- 

 ers in this region is lack of attention to the production of home 

 supplies. Failure to grow adequate forage and garden produce is, 

 in general, a serious impediment to the advancement of an agri- 

 cultural region. The long growing season gives these farmers almost 

 unlimited opportunity for growing these products. The prosperity 

 of the average farmer, especially the farmer with small means, de- 

 pends in great measure upon the interest he takes in growing animal 

 products, grains, fruit, truck, and garden vegetables for family use. 1 



In Table IV is given a comparison of the average tilled area, capi- 

 tal, receipts, expenses, farm income, and labor income for the dif- 

 ferent tenure groups. 2 



1 In an investigation made by the Office of Farm Management as to what the farm 

 contributes directly toward the family living in Troup and Meriwether Counties, Ga. 

 (U. S. Dept. of Agriculture, Farmers' Bulletin 635), the reports from 50 farms indicated 

 that the average annual value of food, fuel, and house rent furnished by the home farm 

 was $519.63 per family. Of this amount, $376.03 was for food products, such as meat, 

 eggs, dairy products, grains, fruit, and vegetables. The value of these food products fur- 

 nished by the farm represented 78.3 per cent of the total food expenses of these families. 

 The annual value of fuel furnished by the farm was $51.60, and house rent amounted to 

 $92. In carrying this study a little farther we find that the annual value of food, fuel, 

 and house rent furnished by these farms was $96.25 per person. Of this amount, $69.25 

 was for food, $9.56 for fuel, and $17.04 for rent. While there is a wide variation in the 

 standard of living among farmers in Sumter County, the above figures are of interest as 

 indicating the value of the products the farm will afford without much cash expenditure 

 in production. It can readily be seen from these figures that if it were not for those 

 products contributed by the farm without much actual cash expenditure a great many 

 farmers would not realize any savings from their labor income. In order to make the 

 farmer's income comparable to the city man's wages the value of the above items should 

 hp added to the labor income. 



" The interest rate here used is uniform with that used in all of the publications of the 

 Office of Farm Management relating to farm-management surveys. However, after a 

 study of the mortgage rates of interest paid in this area they are found to be 7.7 per cent 

 upon farms of 150 or less tilled acres and 6.6 per cent upon farms of over 150 tilled 

 acres. The average for all farms is 6.8 per cent. It may therefore be of interest in 

 connection with this study to show what the labor income of the farms operated under 

 different tenures would be if a rate of 7 per cent interest on the investment were deducted 

 from the farm income instead of 5 per cent. Based upon a 7 per cent rate, the labor 

 incomes are as follows : 



WMte operators. — Owners, $577; owners additional, $1,062; owners with part rented 

 out, $555 ; tenants, $529. Colored operators. — Owners, $263 ; owners additional, $478 ; 

 owners with part rented out, $175 ; tenants, $302. 



