Larger production per acre of cropland is the most important part of the increase in farm output. By comparison with production per acre, the cropland acreage has been relatively stable since 1919. Production per acre was reduced severely by the droughts of 1934 and 1936. The upward wartime climb stands out in sharp contrast. The increases above the 1935-39 average reflect partly better-than-average weather, but more especially the combination of greater use of lime and fertilizer, legume rotations, winter cover crops, terracing, strip cropping, contour farming, crop variety improvements, and some shifting to crops that yield a larger product to the acre.

A larger volume of crop production provides more hay, pasture, and feed grains; and this makes it possible to produce more livestock. These changes also reflect the larger feed supplies of recent years and the release of feed by the shift from work animals to tractors. Increases in total livestock production have resulted both from keeping more breeding animals and from producing more per animal in the breeding herd.

Improvements in soils, plants, animals, mechanization, pest control, and conservation of moisture-the entire growth of science in agriculture-have enlarged the output of crops and livestock in recent years. It is not likely that this trend will be reversed in the years ahead, unless temporarily in periods of bad weather. Once farm output is expanded it tends to remain high--almost regardless of changes in economic conditions. Farm output is responsive to price increases and other production incentives on the upward side, but it is quite unresponsive to unfavorable conditions on the downward side.

A special study conducted by the Department in cooperation with the land-grant colleges in 1944 indicated that under conditions of relative prosperity it would be profitable for farmers to increase their output of farm products in the years ahead. The changes in farming that were suggested as profitable under relatively favorable conditions would result in further increases in production per acre and per animal and in a total farm output about 43 percent above the 1935-39 average after the transition to peacetime conditions had been completed. That would be 12 percent above the 1945 level. This is not a forecast of what will come to pass even in prosperous times. There is always a lag in adopting practices that would pay, but it would not be unreasonable to assume that continued prosperity for as long as a decade would bring total farm output up to that level.

If relatively unfavorable economic conditions should prevail, production would not be likely to go below the wartime levels, unless growing conditions are below average. Investments once made for capital improvements in farming constitute fixed resources that will be used regardless, almost, of changes in the price of the product. The tractors and other farm machinery will be available for use even in depression, and unemployment in nonfarm occupations usually results in pressure of workers on the land. On the other hand, less commercial fertilizer might be purchased in a period of low prices for farm products, but the effect of such a change on the level of production might be offset by more workers on farms and the pressure to provide some income for the farm family even in a depression. A shrinkage of the producing plant in agriculture is not likely to occur except when fewer workers are employed on farms. Only in prosperous times, when other employment opportunities are available, can workers no longer needed in farming find work elsewhere.

Costs, Prices, and Returns to Farmers

Improvements that bring a higher total farm output need to be analyzed in terms of their effects on farm costs, farm prices, and net incomes to farmers.

Individual farmers make the most profitable use of their resources by producing abundantly, especially just after a shift from animal power to tractor power, because the change enables the farm family to cultivate more acres or to produce more per acre on the farms they now operate. After they have shifted to tractor power, many farmers tend to buy or rent additional land. But if more land is not available, they tend to increase the output per acre by shifting, for example, from oats to soybeans, or from beef cattle to dairy cattle, and perhaps by increasing the poultry flock.

As farmers increase the output per farm, the average cost per unit of output-whether bushel, gallon, barrel, hundredweight-usually goes down because they make fuller use of their machinery and labor. That means more product for each man and each dollar invested in machinery. Therefore, improvements that increase production per farm result in lower unit costs and larger net incomes to farmers unless the total volume of the product that goes to market is increased sufficiently to lower the price received. When farm families increase output by operating larger farms, the total output is not so likely to increase because the extra land was formerly operated by some other family. But when more produce is grown per acre it usually means a net increase in output, and if a large number of farmers produce more potatoes per acre, for example, there will be more bushels of potatoes going to market.

The farmers who first adopt cost-reducing techniques retain all the gain from those improvements until or unless production increases enough to lower the price of the product. If the price is reduced, at least a part of the gain is shifted from producers to other groups. But even if the entire gain were shifted to processors, distributors, and consumers, farmers might still benefit indirectly because more purchasing power would be available for other things-including other farm products. And the farmers who have adopted improved practices would have lower costs and larger output per farm to more than offset the loss from lower prices. So, they are likely to retain part of the gain even with lower prices.

It is the farmers who cannot take advantage of cost-reducing techniques that will have lower incomes if the price goes down as a result of larger output. The workers who are displaced by a labor-saving improvement also will be disadvantaged unless they can find other and more attractive employment.

Although technological improvements usually result in gains to those who can take advantage of them, and in benefits to society as a whole, especially over a period of years, they frequently bring distress to those who cannot readily adjust themselves to the new conditions. The price of progress can be reduced by helping those who are disadvantaged by the change to adapt themselves to the new situation.

But farmers of the United States cannot afford to stop the march of technology. They must keep in step with progress in other industries and with agriculture in other countries; it is necessary for them to adapt their operations to take advantage of the new methods, or to shift to other types of farming. And those who cannot find profitable work in agriculture will need to seek employment off the farm.

Attention needs to be centered, therefore, on the most effective adjustments to the major strides in technology; and especially on ways of aiding those who cannot readily adapt themselves to the new conditions. Price reductions from the increased output that results from technological advances alone are not likely to be great enough to offset all the advantage of lower costs and increased volume to the farmers who are in a position to make full use of the particular improvements. Therefore, one important means of helping farmers to meet the effects of technology is to devise educational and other programs that result in rapid and more general adoption of cost-reducing practices. A dollar saved in cash production expenses is just as important an addition to the farmer's net income as the dollar that comes from sales of the product.

Even those farmers who cannot take advantage of important improvements will not be injured by technological advances unless they result in larger marketings and lower prices. For example, the introduction of the corn picker will not reduce incomes of farmers who continue to pick corn by hand unless it results in more corn going to market at lower prices. But the range in incomes between those who cannot take advantage of the new technique and those who are in a position to do so will be widened. Farmers who cannot adopt cost-reducing improvements, therefore, may need assistance in shifting into other types of farming, or perhaps into other lines of work.

Farm workers who are displaced by technological developments may be greatly disadvantaged by the change unless other nearby employment is readily available. For example, if there should be rapid adoption of the cotton picker, and no expansion of other employment in adjacent areas, the displaced workers would have to migrate to other areas in search of work. And their eventual adjustment to the new situation would depend on the availability of satisfactory jobs for relatively untrained workers.

If a labor-displacing improvement results in unemployment to a large group of farm workers, the cost of finding other work for those who are displaced must be included in the calculation of net social gain from the improvement. Efforts may need to be directed toward finding new and profitable employment for those who are displaced.

If market outlets for farm products could be increased at the same time that farmers were expanding their production and reducing their costs farmers would not need to fear the tendency of production increasing improvements to result in lower prices. In fact, they would then tend to get the full benefit from both the larger volume of output and the lower cost per unit. And fewer farm workers would be displaced.

Future market outlets for farm products are dependent upon the growth of population, and upon the levels of economic activity and employment that are maintained in this country and abroad; also upon the measures that are taken to meet human needs for food and fiber when consumer incomes are inadequate. Those needs are just as real in depression as in prosperity. It is true that the capacity of the human stomach is limited, but those limits have not been reached by a large number of people even in this country, especially from the standpoint of diets of minimum nutritional adequacy. The foods richest in nutrients are, in general, the ones that require the most land and labor per pound or per bushel. Therefore, if people could buy better food, farmers would have a much greater market for their products.