FARM OWNERSHIP AND TENANCY IN TEXAS. 27 
of the interest paid in the region for loans under reasonably favor- 
able conditions. 
In practice the operator does not calculate his labor income in this 
manner. He knows that what he receives from the farm for family 
living materially reduces his family expenses, correspondingly in- 
creasing his reward for labor and management. Furthermore, if he 
is an owner, knowing that land values have steadily risen in the past, 
he assumes that this rise in the future will supplement the low re- 
turn that his land yields from its present use. Moreover, he fre- 
quently is influenced to pay more for his farm than he otherwise 
would pay, because he desires to own his home. Consequently, part of 
the land cost is considered part of his family expenses. In short, he 
does not charge all of the present cost of land to its present operating 
use. Hence, the landowner realizes that he has not in any sense low- 
ered his power to earn wealth by becoming an owner ; he knows that 
he has bought new personal satisfactions and future incomes which 
he thinks are worth the price paid for them. 
Thus, when these values are not deducted from the net surplus 
which is the reward of the operator for his work and management 
(see item 6) the result is quite different from that shown in item 4. 
The average labor income of owner operators increased from $317 
to $1,293, and tfie increase for the labor income of owners' additional 
income is from minus $61 to plus $731. 
The average rate of net return on the investment of the share ten- 
ant in the farm business is more than four times as large as the rate 
of return to owners on their investment (see item 7). This situation 
is quite generally realized, and is a strong stimulus to the develop- 
ment of tenancy in the area. 
The pecuniary considerations responsible for this tendency may 
be further shown by presenting the things that would confront a 
share tenant who contemplated buying the average farm operated 
by the share tenants interviewed. The average value of the farms 
operated by share tenants was $16,489 (see Table 9), and the average 
net rent paid to the landlord in 1919 was $924. 31 Assuming that 
the tenant could pay one-third of the price of the farm in cash, 32 
the interest at 1\ per cent on the remainder would amount to $825 
for the year, leaving a remainder over rent of $99 to apply as pay- 
ment for the interest on the cash payment and upkeep. Interest on 
the cash payment would amount to $412, and after taking the re- 
mainder of $99 from this, the tenant would be short $313 as an owner 
of the place he rented in 1919. For this $313 he would have to get 
31 Net rent as used here is the gross rent from the land less taxes and upkeep. 
32 The approximate per cent paid in cash by owners who have bought since 1900. (See 
Table 20. i 
