40 BULLETIN 1295, U. S. DEPT. OF AGRICULTURE 
Differences were not all due to the circumstances mentioned. Dif- 
ferent colonizing companies had somewhat different policies. They 
were influenced by two opposite sets of consideration—one led them 
to divide the available area into a large number of small farms and 
the other to divide it into a smaller number of larger farms. 
One of the considerations against too small a unit is the com- 
paratively larger expense of selling a given amount of land. To 
divide 10,000 acres into 500 tracts of 20 acres makes the expense of 
selling the entire area much greater than to divide it into 125 tracts 
of 80 acres, for it costs about as much to sell a 20-acre plat as to 
sell an 80-acre plat. Again, if the company is helping to finance the 
development of the tract by advancing funds for constructing build- 
ings, clearing land, purchasing stock, equipment, seed, etc., it will 
have to invest a very much larger amount of capital if it divides its 
tract into 500 farms than if it divides it into 125 farms. Further- 
more, the greater the number of settlers on the tract, the greater the 
expenses for supervision, accounting, collections, and general services. 
On the other hand, the interest. which the company has in a rapid 
turnover of its capital exerts an influence against the sale of large 
tracts on credit. The ability of the company to get its capital out of 
a project is partly dependent on the ability of the settlers to meet their 
payments, which in turn depends on the amount of land they can 
get into cultivation. Ifthe company is using mortgages as collateral 
tor borrowing funds, it depends upon having each settler develop his 
holding sufficiently to support a mortgage. For a settler with a given 
amount of capital the larger acreage means a larger proportion of 
idle land and a heavier financial burden, thus decreasing the rate 
at which he can retire his indebtedness to the company. 
Another important consideration is that if larger rather than 
smaller tracts are sold to settlers a smaller proportion of the area 
sold will be cleared and developed in a given period after settlement. 
Consequently, the country will make a poorer impression on new 
prospects, and the whole level of land values in the area will rise 
more slowly. 
An important consideration is the available capital of the settler 
at time of purchase. Within certain limits, the more capital the 
settler has available, the larger the tract the firm will be justified in 
selling him. But if a colonization company is interested in the de- 
velopment as well as in the sale of its holdings, this principle is ap- 
plicable only within limits. It is true, the more capital the buyer has 
the more safely he can undertake the purchase of a larger tract from 
the standpoint of fulfilling the terms of purchase, but the payment 
of his land debt and the repayment of the capital advanced by the 
company must still depend upon the rate of development of his 
holding. 
If, instead of buying more land and making larger initial pay- 
ments, the settler with more capital would use it to support his 
family so that he would not have to work out so much of the time, or 
to buy dynamite and other land-clearing aids, he would undoubtedly 
be able to pay off his debts more rapidly. But there is a limit even to 
this conclusion for it is likely that the wages a settler can earn work- 
ing out are worth more to him part of the year than land clearing. 
