Economics of American Agriculture

Economics of American Agriculture

Economics of American Agriculture

Economics of American Agriculture

Excerpt

Farmers face many of the same economic problems the world over. Except in completely regimented economies, they must decide what and how much to produce, what productive resources to use in what combinations, and when and how to market their products. But the way that farmers arrive at solutions to these questions varies country by country and even area by area within a country. Such problems as acquiring land, adjusting the farm business to price fluctuations, and maintaining foreign markets also differ from country to country.

We will discover, as different problems are brought under review, that analyses of the economic problems of United States agriculture involve primarily the application of economic principles to specific, concrete situations encountered by farmers. The different analyses are thus given a unity and continuity by the unity and continuity of economic principles. Although all the results of our studies do not have direct application in other countries, the substitution of different illustrative data would make many of the chapters equally applicable to countries other than the United States.

Problems in achieving efficiency in production. The first group of problems is concerned with achieving a high level of efficiency in farm production. Why do farmers in one part of the United States specialize in lettuce or sugar beet production and those in another part specialize in fluid milk production? This problem of determining what to produce is as old as agriculture. Farmers in the United States have done an excellent job in adjusting their production to their market outlets and to the resources with which they work. Yet there are economic forces that keep this problem from ever reaching a final solution because the best combination of farm enterprises for each particular farm and farmer is constantly changing.

Another problem to which we will give close attention is that of determining unit costs of production. To what extent are costs . . .

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