64 BULLETIN 1480, U. S. DEPARTMENT OF AGRICULTURE 
The department is now cooperating with several States in building 
up an adequate series of farm prices for the period prior to 1908-10. 
The necessary information is being obtained from old account books 
of farmers and dealers in agricultural products, sale slips, news- 
paper files, court records, and other documents. This step is funda- 
mental before even an approach can be made to some of our economic 
problems. Market prices can never fill all the needs of economic 
research. 
SUMMARY 
Farm prices show price changes in the local farm market and are 
at the same time a composite for a definite geographical unit such as 
as a State. They are an average of the grades, varieties, and 
qualities being sold each year and include prices from surplus-pro- 
ducing and deficit areas within any given State. 
A detailed statistical analysis of the monthly farm-price samples 
for various products in many States indicates that the prices of the 
more important farm products in all States except a few of very 
limited size are based on a sufficient number of reports to render 
the average reasonably stable and reliable. There are a few cotton 
States, such as Louisiana, where a larger number of reports would 
be desirable. Although many of the far Western States are large in 
size, the area farmed is often relatively small, and conditions are 
so varied in different parts of the same State that it is extremely 
difficult to obtain a sufficiently large sample or number of reports to 
give stability to the average. 
It is not feasible, with the facilities available, to strive for the 
same high degree of reliability in prices of minor products or of 
products which are little sold by farmers, because to do so would 
necessitate having a very large number of reporters. But even the 
price data for minor products afford valuable information as to the 
general trend of prices over a period of a year or more. 
Generally speaking, the December 1 prices of crops and the Janu- 
ary 1 values of livestock are based on so many more reports than the 
monthly prices that the State averages for those dates, especially 
those of minor farm products, are more reliable than the monthly 
prices. It is not unusual, however, for a sample of December 1 prices 
or of January 1 values to show greater variability than a correspond- 
ing monthly price. There is the additional assurance at the present 
time that these prices and values are also obtained from another list 
of crop reporters reporting to the State statisticians, and the results 
from both samples combined to obtain the final figure. 
No one series of prices is equally suitable for all purposes, but 
for practical reasons it is not feasible to develop a new series of 
prices for each new use. Those using the farm-price data of the 
department, should, therefore, understand their characteristics and 
realize both their advantages and limitations. 
The December 1 and monthly prices, being weighted by produc- 
tion rather than by sales, are better adapted for the purpose of 
calculating the value of crops and crop production than for the pur- 
pose of determining agricultural or farm income. The farm prices 
are a better measure of the price level of farm products over a 
period of time than are wholesale prices. 
