22 BULLETIN 1382, U. S. DEPARTMENT OF AGRICULTURE 
slightly more indicative than net worth of the farmer's capacity as 
a producer. Other things being equal, capacity as a producer should 
mean ability to pay. therefore the average annual rate of accumula- 
tion is accepted with net worth as a measure of the ability to pay, 
for the purpose of further analyses. Several other factors, regarded' 
of less significance than net worth or rhe average annual rate of 
accumulation of the ability to pay are included in some of the 
analyses, primarily for the purpose of discovering some of the inter- 
relations which may be involved in the study. Among these addi- 
tional factors are the number of years since the farmer began his 
earning life, acres per farm, cost of operation of the farm business 
and index of diversity of the farm enterprises. The inclusion of 
acres and cost of operation in certain of the analyses should throw 
some light on the extent to which farm business resources are re- 
flected in the ability of farmers to pay. 
ABILITY OF FARMERS TO PAY AS RELATED TO STANDARD OF 
LIVING 
The relation between the standard of living in farm homes and 
the ability of farmers to pay. as measured by net worth, annual 
rate of accumulation, and years since the farmer began work for self, 
is evident from Table 8. The standard of living is measured in 
terms of the sum of expenditures for all purposes per family and 
per cost-consumption unit and in the percentage that the expendi- 
tures for advancement are of the sum of all expenditures per cost- 
consumption unit. 
Evidences of close relations between each, the net worth of the 
farmer and the average annual rate of accumulation and expendi- 
tures in all terms of measurement are noted in Table 8. Of these 
two criteria of the ability to pay the former seems to have the more 
significant bearing on the standard of living. This is to be ex- 
pected since the amount of purchasing power available is of more 
importance usually than is the rate at which it has been accumu- 
lated. The number of years since the farmer began his earning 
life are less closely related to the standard of living than are net 
worth and annual rate of accumulation. Again, this is to be ex- 
pected since the total amount of wealth available is of more signifi- 
cance than the time required for its accumulation. Few men strive 
equally hard to increase their ability to produce wealth and to 
save more money as they grow older. Furthermore, different de- 
mands are made upon the accumulated funds by different families. 
Although the earning span or life of a competent and thrifty man 
is characterized bv a gradually rising accumulative abilitv until 
some where near the age of 50, allowance must be made for addi- 
tional demands upon accumulative funds for the family living. But 
these demands would probably be met in many instances by the 
contributions made by the sons and daughters to the family living 
fund. 
Other criteria of the farmer's ability to pa}' were tested for rela- 
tions with the standard of living. These included the percentage 
of the total net worth received from gratuitous sources and the per- 
centage of the total net worth obtained from net increases in the 
value of land. Neither the percentage of the total net worth re- 
