1921.] 



The Control of Farm Management. 



225 



THE CONTROL OF FARM MANACxE- 

 MENT AND SOME FUNDAMENTAL 

 PRINCIPLES IN AGRICULTURAL 

 COSTING. 



C. S. Orwin, M.A., 

 Institute for Researcli in Agricultural Economict:, Oxford. 



The importance of the study of Fanu Management is receiving 

 recognition only slowly. The expansion in agricultural education 

 and research work which began about five and tvrenty years ago 

 has been confined almost entirely to natural science, and although 

 results of enormous practical value to the farmer have been 

 produced, the full benefit of such work has not been secured owing 

 to the neglect of any attempt to balance it by the study of agri- 

 cultural economics. The economic law with which production 

 from the land has to contend is the law of diminishing returns, 

 while any attempt to wring the last bushel of corn from the land 

 and to produce the last pound of meat and the last gallon of milk 

 can only be justified so long as it can be shown that maximum 

 production is accompanied by maximum financial reward. It is 

 always the economic factor that, in the long run, controls produc- 

 tion. Soil and climate are factors of obvious importance, but 

 innumerable examples can be given of the adaptation of poor 

 soils to most intensive husbandry, given suitable conditions a& 

 to supplies of fertilisers and accessibility of markets, whilst far 

 better soils under less favourable economic conditions are perforce 

 devoted to far less productive systems of manacjement. The 

 successful farmer is not necessaril}^ the man who produces that 

 which soil or climate or inclination indicate, but he who. after 

 a stud}^ of economic factors, decides which will be most profitable. 

 Such a study depends largely upon his ability to examine, bv 

 scientific book-keeping, the proc^^sses of production. 



Costing, or management book-keeping, aims at mvch more 

 th:in mere financial accounting. The latter is intended to furnish 

 evidence as to the general financial position of a business at any 

 time : the former supplies the only means by which the manage- 

 ment of an enterprise can bo tested and examined in all its 

 df^partments. When industry was in a priuiitive condition — 

 wlion people were producing mainly to satisfy their ov.n indi- 

 vidual needs — there was no necessity for an analysis of the (dsts 

 of th(^ various pv(X'oss(^s nf production, but ir, |)ropnvti()ii as th'^ 



c 



