Agriculture Reference
In-Depth Information
2
Farming in North America
Before examining the economic forces that shape the organization of modern agriculture,
one must have an understanding of some of its basic features. Modern agriculture is a
complex business in which farmers use a combination of land, skilled and unskilled labor,
expensive machinery, genetically engineered seed, chemical pesticides, and sophisticated
cultivation and harvest techniques to produce a crop. Throughout the topic we refer to a
“farmer” as the individual with control over production. The farmer is likely to be a residual
claimant, but not the only one.
1
Modern North American farms are large, capital-intensive
enterprises compared to farms in less developed countries and compared to those just one-
half century earlier.
2.1
Basic Farming Facts
Table 2.1 shows some summary statistics for the most recent census years for Canada and
United States.
2
The table shows 1.9 million farms in the United States, averaging nearly
500 acres per farm.
3
The farms average over $100,000 in annual sales and have an average
value of nearly $450,000. Table 2.1 also shows the numbers for Canada, which paints a
similar picture.
Table 2.2 reports data on farm characteristics in 1920 and 1997, and clearly shows that
changes in agriculture over the past century have been dramatic. As recently as 1920 there
were over 6.5 million farms, averaging just 149 acres. At the same time, nearly one-third
(30.1%) of the total U.S. population lived on farms. In 1920 most farmers still used draft
horses to power their equipment, employing over 25 million draft horses and mules on
farms.
4
By 1997 there were less than 2 million farms, and the average farm size had
more than tripled to roughly 500 acres. Similarly, by 1997 less than 2 percent of the U.S.
population resided on farms.
5
By 1997 large tractors had long dominated farming, with 3.9
million tractors in total and more than 15 percent of all farms having at least four tractors.
6
Use of chemical fertilizer and pesticides has also increased. In 1930 American farmers
used just 16.5 pounds of commercial fertilizer per farmland acre. By 1985 that number had
increased to 93.6 pounds per acre.
7
Along with these dramatic changes in farming technology came equally dramatic in-
creases in farm productivity.
8
In 1920 corn averaged 30.9 bushels per acre and wheat
averaged 13.9 bushels per acre. By 1997 corn yields averaged 124.1 bushels per acre and
wheat yields averaged 37.5 bushels per acre. The historical trend in North American farming
has been toward fewer and larger farms, greater use of expensive equipment and chemicals
(fertilizers and pesticides), and spectacular increases in crop yields. All of this change took
place over the life span of a single farmer. Perhaps more dramatic, as we show later, the
organization of farms has remained remarkably stable over this period of change.
