When the investment in farm buildings is high or when there is a considerable acreage of hay and pasture, the crop-share-cash lease is a common type. This type of lease permits a greater range of choice in production plans if the share of rent and the amount of the cash rental accurately reflect the relative contribution of landlord and tenant. These arrangements are often set by the custom of the community, and when rental payments on a particular farm are out of line with the productivity of the resources of that farm, a less than optimum cropping program is likely to develop. Too high a pasture rental, for example, will tend to drive pasture out of the crop rotation. Conversely, too low a cash rent for buildings will discourage maintenance of barns and other livestock facilities by the landlord and will lead to emphasis on cash-crop farming.

Availability of capital influences the choice of the cropping system on many farms. Lack of adequate capital has the general effect of encouraging short-run production plans, with emphasis on cash crops and short rotations. A farmer whose capital, including what he can borrow, is limited, is likely to choose the livestock enterprises that are most liquid and hence most easily financed.

Financing generally is most readily obtained for enterprises that are suited to the use of short-term credit. Various feeding-out enterprises are notable examples, provided the farmer already has the needed buildings and equipment and grows most of his feed. Enterprises that involve the maintenance of breeding herds or the acquisition of the equipment needed for establishing a new livestock enterprise of almost any kind are less easily financed. This is of particular significance in connection with efforts to change systems of farming in the direction of increased emphasis on livestock.

The size of the farm influences the choice of cropping system. Small farms tend to have more intensive rotations than the larger farms because of the greater pressure for immediate income. The small farm problem represents a special kind of capital limitation. Insufficient land is available in some communities and areas to permit the enlargement of farms to obtain adequate economic units. Making available additional credit for purchase or rental of additional land will help, but other steps are needed also. These include reduction in the pressure for farm income in such areas by development of additional farm and nonfarm resources and adjustments in manpower resources through migration.

EXTENT OF KNOWLEDGE, attitudes, and traditions influence cropping systems and often cause them to deviate from those that would appear to be most profitable.

Often farmers do not know the results that would follow from a change in the rotation or from the introduction of a management practice. Information based on experiments frequently is not available to indicate the productivity of improved practices.

It takes time to disseminate the results of experiments. A study in Iowa in 1949 reported that one-fourth of the farmers interviewed thought that contour farming of fields with slopes of 4 percent or more would not pay, although research studies indicate that this practice is profitable. This study also revealed that the farmers interviewed did not have adequate knowledge of the relative profitability of alternative livestock enterprises under stated conditions. Limitations of knowledge and skill are especially important with respect to situations in which a change in farming systems is needed.

In addition to knowledge, the personal preferences of farm operators influence their choice of cropping systems. Some farmers do not grow forage crops because of an aversion to being "tied down" to the care of livestock.

GOVERNMENT PROGRAMS influence cropping systems by altering price relationships among enterprises. Acreage allotments usually are tied to a historical base, and farmers sometimes try to maintain the acreage of a crop in order to have a favorable base.

Economic conditions change over time, and the changes affect the profitability of rotations and cropping systems. Improvements in varieties have been greater for some crops than for others. The increased use of commercial fertilizers has put inorganic nitrogen in direct competition with legume crops as a source of nitrogen.

Improvements in the mechanization of crop production have reduced labor and power requirements for grains more sharply than for forage crops. During the First World War, about 34 man-hours an acre were used in the production of corn. Producing an acre of hay took about 13 man-hours. Now only about 13 man-hours are needed for an acre of corn and 6.5 hours for an acre of hay. Labor used per acre has declined about 60 percent for corn and 50 percent for hay. Yields of corn have increased much more than have yields of hay, and the decline in man labor per bushel of corn has been 74 percent compared with only 56 percent per ton of hay. But the increase in price of corn over this period has been greater than for hay.

These changing production relationships and altered price conditions have changed the rotation that is most profitable. The rotation that is most profitable today has more grain and less hay in it than was the case 30 years ago.

I have discussed the economic principles that affect soil-management systems in terms of farmers' decisions and farmers' profits. The same principles apply to national decisions and national welfare.

IN APPLYING THE PRINCIPLES to the formulation of national policies, it is necessary to think in terms of a time span that runs over many generations rather than within a single generation or less. Because of the longer term outlook, and the lower interest rate at which the governments can borrow money, the rate of discount of future incomes is lower. It is sometimes held that a national government should not discount future incomes from resources, as a Nation views its own life as perpetual. Ordinarily, however, societies do discount the future because they are confronted continually by pressing short-run demands for use of resources, and emergencies arise that call for all-out immediate production.

Risk also may be viewed differently from the national viewpoint. A country can take an actuarial view of ordinary vagaries of weather, as geographic, seasonal, and cyclical fluctuations in yields tend to average out. These fluctuations can be dealt with more easily at the national or regional level than at the individual level, as it is easier to maintain reserves for an area than for an individual farm.

From the standpoint of national policy, three important elements of risk and uncertainty must be taken into account.

The first is the uncertainty of future food and fiber requirements.

Second is the risk of allowing permanent, irreversible soil erosion to impair future potential productivity to such a point that future needs for food-cannot be met cheaply.

Then there is the uncertainty that a continuing stream of new technological improvements can be maintained.

These problems are interrelated. Advancing technology may make less arable land necessary to feed a given population, but abundant uneroded land may make future technologies more productive than would otherwise be true.

From the national and the individual viewpoints, the application of basic economic relationships to soil-management problems will improve farm incomes and assist in maintaining a productive agriculture.

Economic principles help farmers choose soil-management practices and systems that will help them reach their objectives.

An understanding of the economic principles involved helps to explain why farmers follow certain soil-management systems and why some of them adopt recommended practices more rapidly than others.

Economic principles also reveal the ways in which changing economic and technological conditions have altered the profitability of soil-management systems over time. These principles are helpful also in shaping the land-use policies and programs of public agencies.