The Income Structure of by Economic Class

Luther G. Tweeten

American Journal of Agricultural Economics, 1965, vol. 47, issue 2, 207-221

Abstract: Major pronouncements and public decisions concerning the financial health of agriculture have been based on inadequate farm income data. Sizeable gaps exist in knowledge of farm operator labor income by size of farm after allowing for equity capital costs and capital gains. This study shows that 90 percent of farm operators did not cover all costs in 1960, with resources valued at their current opportunity cost. While operators of class I farms (3 percent of total) received a significant economic rent above costs, the results suggest that these farmers would be most severely disadvantaged by the immediate impact of a severe price drop. With average 1950–60 capital gains added to labor income, approximately one-fourth of all farm operators earned more than a factory wage standard. Class I farmers require only a 71 percent of parity ratio (1910–14 = 100) to cover all 1960 costs, but class VI commercial farmers need 299 percent of parity.

Date: 1965
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Persistent link: https://EconPapers.repec.org/RePEc:oup:ajagec:v:47:y:1965:i:2:p:207-221.

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