

FARM MANAGEMENT PRACTICE OK CHESTER COUNTY, PA. 59 



diagram. The first marked increase occurs at about 35 acres. Beyond 

 this there is not much change in the maximum labor incomes until . 

 we reach about 75 or 80 acres, though the number of farmers making 

 good incomes is greater on the average as the size of the farm in- 

 creases. The 40 to 50 acre dairy farm here represents the efficient 

 size of a one-man farm. From this up to about 75 acres the farms are 

 not large enough for full-sized two-man farms, unless organized and 

 equipped with a good deal of skill. Yet they are too large for one- 

 man farms. A good many of the farms of this size were equipped 

 with two-man outfits, which were not fully utilized. Others were 

 equipped with one-man outfits which could not conduct the business 

 efficiently. This accounts for the fact that a few well-organized and 

 well-conducted farms of about 35 to 40 acres in size were approxi- 

 mately as efficient as any of the farms until we reach about 80 acres. 

 At this point we reach the efficient size two-man farm, and immedi- 

 ately we begin to find farms with much larger labor incomes. Above 

 this we have a group-of farms somewhat too large for efficient opera- 

 tion on a two-man basis and somewhat too small for efficient operation 

 on a three-man basis. While the proportion of successful farmers is 

 larger in the upper portion of these limits, there are individual farms 

 around 80 acres which have larger labor incomes than any other 

 farms within the limits here under consideration. 



The results shown in figure 9 demonstrate that we must use care 

 in interpreting averages in farm-management surveys. There are 

 other factors which may, in special cases, become more important 

 than magnitude of business. The average labor income of the 

 entire 378 farms operated by their owners is $789. This is con- 

 siderably larger than the average labor incomes found in most of our 

 surveys. This, however, does not necessarily mean that the farmers 

 of this locality have better incomes than those elsewhere. The labor 

 income is what is left of the net income of the farm after allowance 

 has been made for interest on the capital invested in the business. 

 The rate of interest used in making these calculations was 5 per cent, 

 which rate is approximately the prevailing rate for well-secured farm 

 loans. But one reason for using this rate was to make it possible 

 to compare the average labor income of farmers in this region with 

 those of others in which this same rate was used. 



There is a very distinct tendency for the price of farm property, 

 especially real estate, to rise to such, a point as to absorb all the 

 profits in farming except the wages of the operator. The higher 

 labor incomes found in Chester County simply indicate that the 

 farmers of this region had not at the time of this survey (1911-12) 

 fully capitalized the earning power of their property. Under such 

 conditions it is impossible to buy land at the prevailing prices with 

 some degree of certainty that it can be made profitable. As previously 



