14 



BULLETIN 694, U. S. DEPARTMENT OP AGRICULTURE. 



Table VII. — Relation of type of farming to amount of capital used and labor income on. 

 farms operated by oiuners, Lenawee County, Mich. 



Type of farming. 



Dairying, hogs, and grain 



Dairying and hogs 



Dairying 



Dairying and grain 



Number 

 of farms. 



Average 

 invest- 

 ment. 



114 

 54 

 28 

 17 



S12,897 

 10,974 

 12,640 

 12,522 



Average 



labor 

 income. 



S626 

 433 

 378 

 278 



Since the capital invested averages about tlie same for each of 

 these groups of farms, the influence of the size of business as measured 

 by capital is practically eliminated. It is therefore fair to conclude 

 that the difference in labor income is largely, if not altogether, due 

 to the type of farmmg. The farms operated with dairying, grain, 

 and hogs as the leading enterprises returned their operators the 

 largest incomes. After' taking out 5 per cent on the investment, 

 these farms had an average labor income of $626 clear of all expenses. 

 On the same basis the dairy and hog farms made an average labor 

 income of $433. The 28 farms classed strictly as dairy farms made 

 an average labor income of, $378. The lowest average labor income 

 was made 'by the combination dairy and grain farms, namely, $278. 

 The figures given in this table are representative of normal condi- 

 tions, but dairy and grain farming, especially with grain production 

 predominating, would show decidedly different results during the 

 abnormally high prices of 1916-17. 



The farms classified under the heading ''Dairying, hogs, and grain" 

 are practically of the type ordinarily classed as general, or diversified. 

 Besides having the three more important enterprises, these farms have 

 a greater use for small enterprises than the more specialized farms, 

 thereby enabling them to use capital and labor to better effect. This 

 type is most prevalent in this section, and the figures given confirm 

 the apparent belief of the farmers of the region that the general farm, 

 with a hmited amount of dairying, is under normal conditions the 

 most profitable type of farm organization so far developed there. 

 Diversity is an important factor which helps to make these general 

 farms profitable and comparatively certain of income. This is 

 brought about not only through the larger number of sources from 

 which the income is derived, but by reason of the fact that this type 

 is less subject to fluctuations from year to year than the specialized 

 type. 



There are comparatively few farms in this area which may be 

 classed as dairy and grain farms. Specialized dairy farms are 

 slightly more numerous than dairy and grain farms and under 

 normal grain prices have a shghtly higher average labor income. 



