• TABLE OF CONTENTS
HIDE
 Front Cover
 Table of Contents
 Preface
 Summary
 General overview of study
 Sources of change in crop...
 Land and other natural feature...
 Land tenure and size of holdin...
 Technology
 The human factor
 Capital and credit
 Demand and prices
 Marketing facilities and pract...
 Agriculture in the economy of underdeveloped...
 Conclusion
 Bibliography
 An illustration of uses of this...
 Statistical tables






Group Title: Foreign agricultural economic report no. 26
Title: Changes in agriculture in 26 developing nations, 1948 to 1963
CITATION PAGE IMAGE ZOOMABLE PAGE TEXT
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00053826/00001
 Material Information
Title: Changes in agriculture in 26 developing nations, 1948 to 1963
Series Title: Foreign agricultural economic report
Physical Description: v, 134 p. : maps. ; 26 cm.
Language: English
Creator: United States -- Dept. of Agriculture. -- Economic Research Service. -- Foreign Development and Trade Division
Publisher: Economic Research Service, U.S. Dept. of Agriculture
Place of Publication: Washington
Publication Date: [1965]
 Subjects
Subject: Agriculture -- Economic aspects   ( lcsh )
[Farm produce -- Statistics]   ( nal )
Developing countries   ( lcsh )
 Notes
Bibliography: Bibliography: p. 122-125.
General Note: Cover title.
General Note: Prepared by a team with William E. Hendrix as leader.
Funding: Florida Historical Agriculture and Rural Life
 Record Information
Bibliographic ID: UF00053826
Volume ID: VID00001
Source Institution: Marston Science Library, George A. Smathers Libraries, University of Florida
Holding Location: Florida Agricultural Experiment Station, Florida Cooperative Extension Service, Florida Department of Agriculture and Consumer Services, and the Engineering and Industrial Experiment Station; Institute for Food and Agricultural Services (IFAS), University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: aleph - 000110660
oclc - 01297606
notis - AAM6314

Table of Contents
    Front Cover
        Front Cover
    Table of Contents
        Page i
        Page ii
    Preface
        Page iii
        Page iv
    Summary
        Page v
    General overview of study
        Page 1
        Objectives, scope, and methods of study
            Page 1
        Study general attributes of the study countries
            Page 1
            Page 2
        Why improving agriculture is needed
            Page 3
            Page 4
        Recent trends in agricultural output
            Page 5
            Annual compound rates of change in crop output
                Page 6
            Per capita change in crop output
                Page 7
            Changes in crop output relative to growth in food demand
                Page 7
                Page 8
                Page 9
                Page 10
                Page 11
                Page 12
        Elements associated with differences in levels and rates of change in agricultural output
            Page 13
            Differences in output per agricultural worker
                Page 13
            Differences in rates of increase in crop output
                Page 14
                Page 15
                Page 16
            Differences in crop yield increases
                Page 17
                Page 18
    Sources of change in crop output
        Page 19
        Change in area of crops
            Page 20
        Change in crop patterns
            Page 20
            Page 21
            Page 22
        Change in crop yields
            Page 23
        Yield-increasing methods
            Page 24
            Page 25
    Land and other natural features
        Page 26
        Agriculture land area and expansion potentials
            Page 26
            Page 27
            Page 28
        Differences in quality of soil resources
            Page 29
            Page 30
            Page 31
            Page 32
        Climate
            Page 33
        Water resources
            Page 33
            Page 34
    Land tenure and size of holdings
        Page 35
        Page 36
        Page 37
        Page 38
        Page 39
        Relation of size of holdings or farms to output and progress
            Page 40
            Page 41
            Page 42
            Page 43
            Page 44
    Technology
        Page 45
        Differences in current technologies
            Page 46
            Page 47
            Page 48
            Page 49
        Present technological basis for increasing output
            Page 50
            Local techniques now in use on best farms
                Page 50
            Technological exchange between countries
                Page 50
            Fertilizers
                Page 51
                Page 52
                Page 53
                Page 54
            Improved crop varieties
                Page 55
                Page 56
                Page 57
            Mechanical improvements
                Page 58
                Page 59
                Page 60
        Research for improving technological bases
            Page 61
    The human factor
        Page 62
        Population size and agricultural output
            Page 63
            Page 64
            Economically active population
                Page 65
                Page 66
        Qualitative factors affecting supply of labor
            Page 67
            Health conditions
                Page 67
                Page 68
                Page 69
            Educational levels and programs
                Page 70
                Page 71
                Page 72
                Page 73
            Agricultural extension
                Page 74
        Cultural patterns and value orientations
            Page 75
            Page 76
    Capital and credit
        Page 77
        Present capital features
            Page 77
            Capital on farms
                Page 77
            Capital in agricultural service facilities and general infrastructure features
                Page 78
        Needs for more capital
            Page 79
        Ways for mobilizing more capital for agriculture
            Page 80
        Credit facilities and practices
            Page 81
            Kinds of credit agencies
                Page 81
            Noninstitutional lenders
                Page 82
                Page 83
            Institutional lenders
                Page 84
                Page 85
                Page 86
                Page 87
    Demand and prices
        Page 88
        Some methodological considerations
            Page 88
        Agricultural output
            Page 88
            Agricultural output and domestic demand
                Page 88
                Page 89
                Page 90
                Page 91
            Agricultural output and exports
                Page 92
            Agricultural output and imports
                Page 92
                Page 93
                Page 94
                Page 95
        Productivity
            Page 96
            Productivity and demand associated with population
                Page 97
                Page 98
            Productivity and commercial domestic demand
                Page 99
            Productivity and exports
                Page 99
        Prices
            Page 100
            Page 101
            Page 102
    Marketing facilities and practices
        Page 103
        Market systems and economic development
            Page 103
            Page 104
        Conceptual considerations
            Page 105
        New market production
            Page 106
        Market facilities
            Page 106
            Transportation
                Page 107
            Storage
                Page 107
                Page 108
            Processing
                Page 109
        Marketing practices
            Page 109
            Page 110
        Market development and public policy and programs
            Page 111
    Agriculture in the economy of underdeveloped countries
        Page 112
        The surplus product contribution
            Page 112
            Page 113
            Page 114
            Page 115
        Labor supply and demand stimulant
            Page 116
        Agriculture's market contributions
            Page 117
    Conclusion
        Page 118
        Page 119
        Page 120
        Page 121
    Bibliography
        Page 122
        Page 123
        Page 124
        Page 125
    An illustration of uses of this publication in agricultural development planning
        Page 126
        Page 127
        Page 128
        Page 129
        Page 130
        Page 131
    Statistical tables
        Page 132
        Page 133
        Page 134
Full Text

CHANGES IN


AGRICULTURE
IN 26
DEVELOPING
NATIONS
1948 TO 1963












FOREIGN AGRICULTURAL ECONOMIC REPORT NO. 27
ECONOMIC RESEARCH SERVICE-U.S. DEPARTMENT OF AGRICULTURE














CONTENTS



Preface .... .... ......... .......... ....... .... ...... ......

Sum m ary .. ....... .... ... ...... .. .... .. .... .. ..... .... .

Chapter 1.--General Overview of Study .............................
Objectives, Scope, and Methods of Study ...........................
Some General Attributes of the Study Countries ......................
Why Improving Agriculture is Needed ............................
Recent Trends in Agricultural Output ...........................
Annual Compound Rates of Change in Crop Output . . . . ..
Per Capita Changes in Crop Output ............................
Changes in Crop Output Relative to Growth in Food Demand . . .
Elements Associated with Differences in Levels and Rates of Change in Agri-
cultural Output...........................................
Differences in Output Per Agricultural Worker . . . . .
Differences in Rates of Increase in Crop Output ...................
Differences in Crop Yield Increases ...........................


Chapter 2.--Sources of Change in Crop Output ...... .......
Change in Area of Crops .... ................ ......
Change in Crop Patterns .. ........................
Change in Crop Yields ...........................
Yield-Increasing Methods ... ..... .. ..............

Chapter 3.--Land and Other Natural Features . . . .
Agricultural Land Area and Expansion Potentials . . .
Differences in Quality of Soil Resources . . . .
Climate ................... ..................
Water Resources ...... ...... .. ....... ... .....

Chapter 4.--Land Tenure and Size of Holdings. . . . .
Relation of Size of Holdings or Farms to Output and Progress.


Chapter 5.--Technology ........................................
Differences in Current Technologies .............................
Present Technological Basis for Increasing Output . . . . .
Local Techniques Now in Use on Best Farms .....................
Technological Exchange Between Countries ......................
Fertilizers.................... ........................
Improved Crop Varieties ..................................
Mechanical Improvements. ..................................
Research for Improving Technological Bases .......................


Chapter 6.--The Human Factor .......................
Population Size and Agricultural Output . . . ..
Economically Active Population ..................
Qualitative Factors Affecting Supply of Labor . . ..
Health Conditions ...........................
Educational Levels and Programs ................
Agricultural Extension . . . ... .. .
Cultural Patterns and Value Orientations . . . .


Page

iii

v

1
1
1
3
5
6
7
7

13
13
14
17


26
26
29
33
33


. ...... 62
. . .. 63
. ...... 65
. . .. 67
. ...... 67
. ...... 70
. . 74
. . .. 75


. . . .
...........
. . . .
. . . .






Page

Chapter 7.--Capital and Credit .............. .. ... ........ ... 77
Present Capital Features .......... .. ................. ... 77
Capital on Farm s .... ... .......... ....... ........... . .. 777
Capital in Agricultural Service Facilities and General Infrastructure
Features . . . . . . . .............. 78
Needs for More Capital. . . . . . . . . . 79
Ways of Mobilizing More Capital for Agriculture . . . . .... 80
Credit Facilities and Practices ................................ .. 81
Kinds of Credit Agencies ................... ............... 81
Noninstitutional Lenders ................... ......... ..... .. 82
Institutional Lenders ...... ..... ................... ..... 84

Chapter 8.--Demand and Prices ................... .. .. .. ...... 88
Some Methodological Considerations ................... ... .. . .88
Agricultural Output ..................... ..... ......... .. 88
Agricultural Output and Domestic Demand .... .. .... ... ....... 88
Agricultural Output and Exports .............................. 92
Agricultural Output and Imports ................... .... ..... 92
Productivity ............................. ............ 96
Productivity and Demand Associated with Population . . . ... 97
Productivity and Commercial Domestic Demand . . . .... 99
Productivity and Exports ................... .... ........ .. 99
P prices . . . . . . . . . . . . 100

Chapter 9.--Marketing Facilities and Practices ....................... 103
Market Systems and Economic Development . . . ..... 103
Conceptual Considerations ..... ... ....... .............. .. ... 105
New Market Production ...................... .. .................. 106
Market Facilities .......................... ............. .. 106
Transportation .......................................... 107
Storage ................................ ................ ........ .. 107
P processing ..................................... ....... 109
M marketing Practices ........................... ........ ..... 109
Market Development and Public Policy and Programs . . . .... 111

Chapter 10.--Agriculture in the Economy of Underdeveloped Countries . ... 112
The Surplus Product Contribution ............................... 112
Labor Supply and Demand Stimulant ............................. 116
Agriculture's Market Contributions .............................. 117

Chapter 11.--Conclusions ................... ................... 118

Bibliography ................... .... ........ .. .... ............ 122

Appendix I.--An Illustration of Uses of This Publication in Agricultural Develop-
ment Planning ... ....... ... .......................... 126

Appendix II.--Statistical Tables... .... ... .. ..... ... .... .......... 132 A









Washington, D.C. November 1965













PREFACE


This publication deals with the performance of agriculture in the economy of 26
developing nations. It reports the major findings of the first or comparative phase of a
research project entitled "Factors Associated with Differences and Changes in Agricul-
tural Production in Underdeveloped Countries". This research is being conducted by the
Economic Development Branch, Foreign Development and Trade Division, Economic Re-
search Service, (ERS) of the U.S. Department of Agriculture for the Agency for Inter-
national Development (AID), under an agreement entered into in March 1963.

This report has been prepared by a team of 11 people all of whom have drawn heavily
upon the work of each other in developing their respective assignments. William E.
S Hendrix, as leader of this team, had responsibility for developing work plans, directing
work activities, and making final revisions in all chapters. Chapters of this report and
authors primarily responsible for them are as follows:

Chapter 1.--General Overview of Study--William E. Hendrix
Chapter 2.--Sources of Change in Crop Output--William E. Hendrix
Chapter 3.--Land and Other Natural Features--Steven A. Breth
Chapter 4.--Land Tenure and Size of Holdings--Jiryis Oweis
Chapter 5.--Technology--Donald D. Steward
Chapter 6.-- The Human Factor--Jane R. Turns (pp. 62-74), David Nicholls (pp. 75-76)
Chapter 7.--Capital and Credit--Dwight Gadsby
Chapter 8.--Demand and Prices--Harold T. Yee
Chapter 9.--Marketing Facilities and Practices--Clarence A. Moore
Chapter 10.--Agriculture in the Economy of Underdeveloped Countries--C. A. Moore
Chapter 11.--Conclusions--William E. Hendrix
Appendix I.--An Illustration of Uses of this Publication in Agricultural Development
Planning--William E. Hendrix

Margarite Settle and Helen Clifton obtained reference sources, compiled data, and
assisted with the statistical work.

The research staff for this report benefited from the information, suggestions, and
criticisms of many experts in agencies of the Department of Agriculture, other U.S. de-
partments, international agencies, universities, and foundations. None of these experts
or the agencies they represent, however, were responsible for interpretations of the
information provided. One of these agencies was the Food and Agriculture Organization
of the United Nations (FAO), which cooperated with ERS in this study under an ERS-FAO
contract from June 1963 through December 1964. Underthis agreement, FAO made avail-
able to ERS its regularly published reports, plus information not heretofore available.
This material included special tabulations made from past survey records and new infor-
mation obtained through questionnaires and field visits byFAO personnel in FAO member
countries.

Data on crop areas and output were developed specifically for this project by the
Foreign Regional Analysis Division, under the technical direction of Charles A. Gibbons.

At all stages in this study,' ERS personnel obtained extensive advice and information
from Dr. Frank W. Parker and Dr. ErvenJ. Long, Deputy Director and Director, respec-
tively, Agricultural Service, Technical Cooperation and Research, AID. Valuable assist-
ance in developing study plans, choosing study countries, and planning country visits for
research personnel was provided by members of an AID Advisory Committee. This com-
mittee initially consisted of Frank W. Parker, Chairman, C. L. Orrben, Monroe McCown,
W. S. Middough, Lyle Peterson, and Alan M. Strout. An ERS Technical Advisory Committee







reviewed and made important recommendations on work plans and on early drafts of this
report. This committee was composed of the following:

Dr. Sherman E. Johnson, Chairman, Deputy Administrator, Economic Research
Service, U.S. Department of Agriculture.
Dr. Max Millikan, Director, Economic Development Center, Massachusetts Institute
of Technology.
Dr. Kenneth L. Turk, Director of International Agricultural Development, Center for
International Studies, Cornell University.
Dr. Gustav Ranis, Associate Director, Economic Growth Center, Yale University.
Dr. William W. Lockwood, Woodrow Wilson School of Public and International Affairs,
Princeton University.
Dr. Sherwood O. Berg, Dean of Agriculture, University of Minnesota.
Dr. E. T. York, Provost for Agriculture, University of Florida.
Dr. John Provinse, retired, formerly sociologist and cultural anthropologist with
Council on Economic and Cultural Affairs.
Dr. Frank W. Parker, Deputy Director, Agricultural Service, Office of Human Re-
sources and Social Development, AID. V

Additional personnel in the Department of Agriculture who counselled on work plans
and early drafts of the report include Willard W. Cochrane, formerly Director of Agri-
cultural Economics; Nathan M. Koffsky, Director of Agricultural Economics; Matthew
Drosdoff, Administrator, and Gerald E. Tichenor, Deputy Administrator, International
Agricultural Development Service; Wilhelm Anderson, Director, and Quentin M. West,
Deputy Director, Foreign Regional Analysis Division, ERS.

Finally, special acknowledgements go to Wade F. Gregory, Chief, Economic Develop-
ment Branch, Foreign Development and Trade Division, ERS, who has offered many helpful
suggestions on the study; to Raymond P. Christensen, Deputy Director, Foreign Develop-
ment and Trade Division, ERS, who helped to develop the participating agency agreement
unaer which this research was done, to staffthe project, and to advise on work plans; and
to Kenneth L. Bachman, Director, Foreign Development and Trade Division, who has
frequently consulted with the project staff and provided counsel on many facets of the
study.














*













SUMMARY


The agricultural problems of 26 developing nations are considered; 7 of these coun-
tries are in Latin America, 4 in Africa, 4 in Europe, 7 in the Near East and South Asia,
and 4 in the Far East.

Objectives of this report were to show levels and changes since 1948 in agricultural
output and productivity in these countries andto identify and assess roles of major physi-
cal, economic, and social factors associated with differences in these levels and changes.

Between 1948 and 1963, 12 of the 26 developing nations had compounded rates of
w increase in crop output of more than 4 percent per year. These rates surpassed those
ever achieved by now economically advanced nations during comparable periods of time.
The 12 countries were: Sudan, Mexico, Costa Rica, the Philippines, Tanganyika, Yugo-
slavia, Taiwan, Turkey, Venezuela, Thailand, Brazil, and Israel.

From 1948 to 1963, rates of increase incrop output failed to exceed population growth
rates in only 5 of the 26 countries--Nigeria, Egypt, Pakistan, Tunisia, and Jordan. From
1955 to 1963, Tunisia and Jordan alone had greater increases in population than in crop
output.
Most of the 26 countries need to increase their agricultural production at even faster
rates to facilitate achievement of their national development objectives. Faster production
rates will supply the foreign exchange earnings which developing industrial sectors and
related urban complexes need in excess of their own foreign exchange earning capacities.
The successes of the 12 leading countries in increasing their agricultural output
enhance the possibility that underdeveloped countries generally can increase their per
capital production of foods and fibers in the near future.
The 12 countries differ largely in many of the factors which influence their agricul-
tural production potentials: in climate; rate of illiteracy; supply of land resources; cul-
tural pattern; and governmental system.
As a source of change in crop output, increases in the area of crops were more im-
portant than yieldincreases in45 percent of the countries while yield increases were more
important in 55 percent.
Arable land expansion potentials are relatively large in much of South America and
Central Africa, but are very limited in densely populated Asian countries.
Within appreciable limits, land, labor, improved seeds, fertilizers, improved human
skills, improved forms of organization, and other such factors can be substituted for
each other in agricultural production. Such substitution possibilities enhance the oppor-
tunities and help to simplify the task of increasing agricultural output and productivity
in the world's less-developed countries. For example, Sudan, which has one of the highest
levels of illiteracy in the world, has achieved a very rapid rate of increase in agricul-
tural production since 1948 through management supervision or special programs of or-
ganization and technical assistance.
The factors associated with differences in rates of increase in agricultural output
among the 26 countries form a rational, but highly variable, pattern that is somewhat in
accord with the uniqueness of each country in its combination of human, land and capital
resources, and technical possibilities, and in its institutional, social, and political
features.
Rapid rates of increase in crop output have not happened just as a consequence of
normal economic and social processes in societies organized on a laissez-faire basis.
Rather, they have been undergirded by aggressive group action, generally national in
scope, directed specifically to improving agricultural production conditions.










CHANGES IN AGRICULTURE IN 26 DEVELOPING

NATIONS, 1948 to 1963



Foreign Development and Trade Division
Economic Research Service


CHAPTER 1.--GENERAL OVERVIEW OF STUDY


Objectives, Scope, and Methods of Study

The main objectives of this study were (1) to measure levels and changes since 1948
in the agricultural output and productivity of less-developed countries, and (2) to identify
and assess the roles of the major natural, technological, economic, social, and institu-
tional factors associated with differences in these performance patterns.

The report is based mainly upon information compiled for 26 countries selected to
represent major low-income regions of the world. This information was for the most part
developed from secondary sources; these included published andunpublished reports, and
working files of cooperating national and international agencies. Supplementary informa-
tion was obtained through brief visits to several of the countries and through interviews
in the United States with experts on these countries.

The 26 study countries are Argentina, Brazil, Chile, Colombia, Costa Rica, Mexico,
and Venezuela in Latin Americ a; Nigeria and Tanganyika (as constituted in 1962) in Central
Africa; the United Arab Republic (Egypt), Sudan, and Tunisia in North Africa; Jordan,
Israel, Greece, Turkey, Iran, Pakistan, and India inthe Near East and South Asia; Thailand,
the Philippines, Taiwan, and Japan in the Far East; and Yugoslavia, Poland, and Spain in
Central and Western Europe. These countries represent an appreciable part of the total
program responsibilities of the Agencyfor International Development: they now represent
approximately 75 percent of the total population, 73 percent of the gross national product,
and 73 percent of the AID budget in all AID-assisted countries.


Some General Attributes of the Study Countries
The 26 study countries exhibit large differences in their natural features, historical
backgrounds, demographic and cultural features, institutions, and levels and patterns of
agricultural and general economic development.

Twelve of the 26 countries lie wholly, or in large part, between the latitudes of 30
degrees north and 30 degrees south of the equator; 12 lie beyond these tropical and semi-
tropical ranges; and the land area of 2 is about equally divided between these major
climatic zones (fig. 1). Six of the countries lie in mainly semi-arid and desert regions.
Most of the others have considerable rainfall, although a few also have semi-arid and
desert areas.

Ten of the 26 countries are European or have large populations of European descent.
Several nations date back into antiquity and some have made large contributions to the
development of civilization through literature, art, mathematics, government, and religious
and philosophical thought. Others have only a short history as a nation and have not yet
made substantial cultural contributions. Three of the world's four major racial groups
and several of the world's major religions exist within one or more of the countries studied.










CHANGES IN AGRICULTURE IN 26 DEVELOPING

NATIONS, 1948 to 1963



Foreign Development and Trade Division
Economic Research Service


CHAPTER 1.--GENERAL OVERVIEW OF STUDY


Objectives, Scope, and Methods of Study

The main objectives of this study were (1) to measure levels and changes since 1948
in the agricultural output and productivity of less-developed countries, and (2) to identify
and assess the roles of the major natural, technological, economic, social, and institu-
tional factors associated with differences in these performance patterns.

The report is based mainly upon information compiled for 26 countries selected to
represent major low-income regions of the world. This information was for the most part
developed from secondary sources; these included published andunpublished reports, and
working files of cooperating national and international agencies. Supplementary informa-
tion was obtained through brief visits to several of the countries and through interviews
in the United States with experts on these countries.

The 26 study countries are Argentina, Brazil, Chile, Colombia, Costa Rica, Mexico,
and Venezuela in Latin Americ a; Nigeria and Tanganyika (as constituted in 1962) in Central
Africa; the United Arab Republic (Egypt), Sudan, and Tunisia in North Africa; Jordan,
Israel, Greece, Turkey, Iran, Pakistan, and India inthe Near East and South Asia; Thailand,
the Philippines, Taiwan, and Japan in the Far East; and Yugoslavia, Poland, and Spain in
Central and Western Europe. These countries represent an appreciable part of the total
program responsibilities of the Agencyfor International Development: they now represent
approximately 75 percent of the total population, 73 percent of the gross national product,
and 73 percent of the AID budget in all AID-assisted countries.


Some General Attributes of the Study Countries
The 26 study countries exhibit large differences in their natural features, historical
backgrounds, demographic and cultural features, institutions, and levels and patterns of
agricultural and general economic development.

Twelve of the 26 countries lie wholly, or in large part, between the latitudes of 30
degrees north and 30 degrees south of the equator; 12 lie beyond these tropical and semi-
tropical ranges; and the land area of 2 is about equally divided between these major
climatic zones (fig. 1). Six of the countries lie in mainly semi-arid and desert regions.
Most of the others have considerable rainfall, although a few also have semi-arid and
desert areas.

Ten of the 26 countries are European or have large populations of European descent.
Several nations date back into antiquity and some have made large contributions to the
development of civilization through literature, art, mathematics, government, and religious
and philosophical thought. Others have only a short history as a nation and have not yet
made substantial cultural contributions. Three of the world's four major racial groups
and several of the world's major religions exist within one or more of the countries studied.










CHANGES IN AGRICULTURE IN 26 DEVELOPING

NATIONS, 1948 to 1963



Foreign Development and Trade Division
Economic Research Service


CHAPTER 1.--GENERAL OVERVIEW OF STUDY


Objectives, Scope, and Methods of Study

The main objectives of this study were (1) to measure levels and changes since 1948
in the agricultural output and productivity of less-developed countries, and (2) to identify
and assess the roles of the major natural, technological, economic, social, and institu-
tional factors associated with differences in these performance patterns.

The report is based mainly upon information compiled for 26 countries selected to
represent major low-income regions of the world. This information was for the most part
developed from secondary sources; these included published andunpublished reports, and
working files of cooperating national and international agencies. Supplementary informa-
tion was obtained through brief visits to several of the countries and through interviews
in the United States with experts on these countries.

The 26 study countries are Argentina, Brazil, Chile, Colombia, Costa Rica, Mexico,
and Venezuela in Latin Americ a; Nigeria and Tanganyika (as constituted in 1962) in Central
Africa; the United Arab Republic (Egypt), Sudan, and Tunisia in North Africa; Jordan,
Israel, Greece, Turkey, Iran, Pakistan, and India inthe Near East and South Asia; Thailand,
the Philippines, Taiwan, and Japan in the Far East; and Yugoslavia, Poland, and Spain in
Central and Western Europe. These countries represent an appreciable part of the total
program responsibilities of the Agencyfor International Development: they now represent
approximately 75 percent of the total population, 73 percent of the gross national product,
and 73 percent of the AID budget in all AID-assisted countries.


Some General Attributes of the Study Countries
The 26 study countries exhibit large differences in their natural features, historical
backgrounds, demographic and cultural features, institutions, and levels and patterns of
agricultural and general economic development.

Twelve of the 26 countries lie wholly, or in large part, between the latitudes of 30
degrees north and 30 degrees south of the equator; 12 lie beyond these tropical and semi-
tropical ranges; and the land area of 2 is about equally divided between these major
climatic zones (fig. 1). Six of the countries lie in mainly semi-arid and desert regions.
Most of the others have considerable rainfall, although a few also have semi-arid and
desert areas.

Ten of the 26 countries are European or have large populations of European descent.
Several nations date back into antiquity and some have made large contributions to the
development of civilization through literature, art, mathematics, government, and religious
and philosophical thought. Others have only a short history as a nation and have not yet
made substantial cultural contributions. Three of the world's four major racial groups
and several of the world's major religions exist within one or more of the countries studied.











PER CAPITAL GNP, 26 COUNTRIES, 1958


U.S. DEPARTMENT OF AGRICULTURE


NEG. ERS 3441-65(1) ECONOMIC RESEARCH SERVICE


Figure 1








In their governmental systems, the countries range from democratic and semidemo-
cratic to authoritarian forms. Several have long been under colonial rule, while others
have been independent nations for a century or more.

In their levels of economic development, most of these countries lie in the lower half
of the world's distribution. Six of the countries--Tanganyika, Pakistan, Sudan, India,
Thailand, and Taiwan--still have a per capital gross domestic value of production in U.S.
dollars of less than $100. Eight of the countries have a per capital gross domestic product
of $300 or more (fig. 1). These are Argentina, Chile, Venezuela, Mexico, Spain, Poland,
Israel, and Japan. Of these countries, Israel, Venezuela, and Japan have recently exhibited
very rapid economic growth. Venezuela's growth is based largely upon its mineral re-
sources. The economy of the other three countries, especially of Argentina and Chile, has
been relatively stagnant for two to three decades. Japan has become a modern industrial
nation, exhibiting a long-sustained and a high rate of general economic growth.

Agriculture is the major occupation of more thanhalf of the total labor force in 16 of
the 26 countries and of more than three-fourths of the labor force in 7 countries (Chapter
6, table 40). It accounts for less than a proportionate share of the national income as a
result of farm-nonfarm disparities in per capital incomes. Even so, agriculture is the
most important industry in all of the study countries and accounts for more than a third
of the gross national (or domestic) product in 19 of the 26 countries.


Why Improving Agriculture is Needed

Some progress has been made during the past decade toward closing the gap between
world food needs and food consumption. Even so, food consumption levels, based upon daily
per capital intake of calories, are below desirable levels in 11 of the 26 study countries.
These 11 countries are Colombia, Sudan, Tunisia, Egypt, Tanganyika, Iran, Jordan, India,
Pakistan, the Philippines, and Thailand (table 1). Because food supplies are unevenly dis-
tributed, most of the other countries have large population groups which suffer from both
undernutrition and malnutrition.

These food deficits are of great magnitude. For example, if present food supplies of
India were distributed as far as they would go at the rate of 2,300 calories per person
per day, 48 million out of that country's 480 million people would be left totally without
food. If these same food supplies were distributed at the U.S. consumption rate of 3,190
calories per person per day, 153 million of India's people would be without food.

Table 1.--Food consumption per person per day and food consumption deficits in 26 study countries, United States, and Netherlands,
1959-61

Food consumption Food consumption Food consumption Food consumption
Region and country per person deficit per Region and country per person deficit per
per day person per day per day person per day

Calories Calories Calories Calories
Latin America Near East and So. Asia
Argentina............. 3,220 0 UAR................. 2,300 200
Brazil............... 2,710 0 India ............... 2,060 240
Chile................ 2,61b 0 Iran................ 2,120 330
Colombia.............. 2,280 220 Israel.............. 2,840 0
Costa Rica........... 2,520 0 Jordan.............. 2,200 250
Mexico............... 2,580 0 Pakistan ........... 2,120 180
Venezuela............ 2,330 170 Turkey .............. 2,590 0
J: Africa
Nigeria............... 2,450 0 Far East
Sudan ................ 2,160 186 Japan............... 2,360 0
Tanganyika ........... 2,440 20 Philippines......... 2,000 350
Tunisia.............. 1,900 450 Taiwan .............. 2,440 0
Thailand............. 2,120 230
Europe
Greece............... 2,960 0
Poland............... 3,100 0 United States......... 3,190 0
Spain ................ 2,740 0 Netherlands........... 3,000 0
Yugoslavia........... 2,900 0

Source: The World Food Budget, 1970, Foreign Agricultural Economic Report 19, ERS, USDA, Oct. 1964.








Food requirements are increasing as a result of population growth (table 2, column 1).
At present growth rates, most of the study countries will double their population in about
25 to 35 years. If they succeed merely in increasing food production at rates equal to their
population growth rates and if there is no change in their import-export ratios, these
countries will also have twice as many hungry people during this time span. It is unlikely
that an increase in agricultural output alone will in the long run reduce world hunger.
Rather, the Malthusian specter of population growth outrunning food production is already
a very real problem in many of the world's less-developed countries. Within a century,
world population of 3 billion people would increase to 23 billion, at an annual compound
rate of growth of 2 percent, and to 36 billion, at a rate of 2.5 percent a year.

Population growth the world over is now associated with increases in the percentage
of total population living in urban centers. Hence, with the passage of time, each agri-
cultural worker has toproduce foods andfibersfor an increasing number of people. More-
over, rising per capital income, especially inurban areas, is increasing per capital demand
for food in most of the world's less-developed countries. Consequently, for the first time
in its history, India's food shortage is not the result of crop failures and declining per
capital food output, but of the increased capacity of its people to buy the food they need.


If predominantly agrarian countries continually fail to meet increased food demand,
their general economic growth will likely be curtailed. This economic retardation can
come about (a) through curtailment of their exports, now composed mainly of agricultural

Table 2.--Annual rate of change in population growth, per capital income, and domestic food demand, 26 study countries, 1950-60

Annual aPercentage of
AnnualAnnual Annual Total annual demand
Region nnul increase Coefficient increase an a
and population in real of income in foodan nee
country rate per elasticity demand increases by population
capital of demand per capital increases by population
income2 groTth
(1) (2) (3) (4) (5) (6)

Percent Percent Percent Percent Percent Percent
Latin America
Argentina ............ 1.7 -0.1 0.17 -0.02 1.68 101
Brazil............... 3.1 2.6 0.51 1.33 4.43 70
Chile................. 2.5 0.9 0.61 0.55 3.05 82
Colombia.............. 2.2 2.3 0.55 1.26 3.46 64
Costa Rica........... 3.9 3.7 0.60 2.22 6.12 64
Mexico ............... 3.1 1.9 0.58 1.10 4.20 74
Venezuela ............ 4.0 3.6 0.61 2.20 6.20 65

Africa
Nigeria............... 3.7 1.9 0.64 1.22 4.92 75
Sudan ................ 3.4 0.8 0.64 0.51 3.91 87
Tanganyika........... 1.8 1.1 0.64 0.70 2.50 72
Tunisia.............. 1.8 1.7 0.65 1.10 2.90 62

Europe
Greece............... 1.0 4.7 0.49 2.30 3.30 30
Poland............... 1.8 6.0 0.55 3.30 5.10 35
Spain ................ 0.8 3.9 0.56 2.18 2.98 27
Yugoslavia ........... 1.1 8.9 0.59 5.25 6.35 17

Near East and South
Asia
UAR.................. 2.4 2.5 0.65 1.62 4.02 60
India................ 2.0 1.7 0.80 1.36 3.36 60
Iran................. 2.2 0.05 0.79 0.04 2.24 98
Israel.............. 5.2 2.5 0.55 1.38 6.58 79
Jordan............... 2.6 1.7 0.65 1.10 3.70 70
Pakistan............. 2.2 0.3 0.80 0.24 2.44 90
Turkey............... 2.9 3.2 0.49 1.57 4.47 65

Far East
Japan ................ 1.2 7.6 0.58 4.41 5.61 21
Philippines.......... 3.2 1.7 0.75 1.28 4.48 71
Taiwan................ 3.4 3.7 0.63 2.33 5.73 59
Thailand.............. 3.2 2.4 0.72 1.73 4.93 65


1 From U.N. (55), Series K, No. 2, table 1, pp. 22-30, except for Israel, which is from Y. Mhndlak, Long-Term Projections of
Supply and Demand for Agricultural Products in Israel, p. 203, Falk Project for Economic Research in Israel, Jerusalem, Iay 1964.
2 (55), pp. 566-568.
3 Agricultural Commodities, Projections for 1970, FAO, Rome, Italy, 1963.








products, (b) through diversion of an increasing part of their foreign exchange earnings
from imports of needed capital goods to imports of food goods in greater demand, and (c)
through the effects of increasing food prices on labor costs in industry and on size of
income available for buying nonfarm goods and services.

At present population and income growthrates,the demand for food in most (16) of the
study countries is increasing at annual compound rates of 4 to 6 percent a year (table 2).
Most of this increase results from population growth (table 2, column 6). The European
countries and Japan can buy much of their needed food with foreign exchange earned by
industrial exports, and therefore do not require high rates of increase in agricultural
output. Underdeveloped, predominantly agrarian countries, however, are not able to
meet increased needs in this way.



Recent Trends in Agricultural Output

To appraise agriculture's recent contributions to the above development needs, an
attempt has been made to develop indices of crop production in the 26 study countries
(table 3). These indices are based upon a more comprehensive coverage of commodities
and employ more uniform methods from country to country than previous indices did.


Table 3.--Total crop production: Index numbers for selected countries, 1948-63 (1957-59=100)1


Country and region


Latin America
Argentina.....................
Brazil ......................
Chile3.......................
Colombia.....................
Costa Rica...................
Mexico................. .....
Venezuela....................

Africa
Nigeria......................
Sudan.........................
Tanganyika...................
Tunisia.....................

Eurone
Greece.......................
Poland .......................
Spain.........................
Yugoslavia...................

Near East and So. Asia
UAR..........................
India......................
Iran..........................
Israel.......................
Pakistan.....................
Turkey.......................
Jordan3 ......................

Far East
Japan........................
Philippines..................
Taiwan.......................
Thailand.....................


1948 1949 11950 1951 1952 1953 1 954 1955 1956 1957 1958 1959 1960 1961 1962 1963


---------------------------------------------Percent --------------------------------------------

81 75 72 64 87 88 92 80 99 88 107 105 93 105 103 113
68 68 74 73 73 77 81 87 82 93 96 111 107 117 114 2 NA
80 77 69 73 76 83 83 90 90 87 105 99 102 103 100 109
78 88 79 82 96 93 97 93 88 87 102 110 115 109 117 NA
49 58 69 71 90 77 86 73 75 94 103 101 118 117 121 NA
48 54 60 62 61 67 80 89 87 94 107 99 106 109 119 119
68 72 69 77 85 95 84 94 104 103 99 98 118 119 136 NA


NA NA NA NA 86 88 89 94 94 98 100 102 112 109 115 117
42 50 58 54 62 69 75 90 105 76 105 119 104 157 130 125
55 55 64 67 74 65 76 87 90 92 99 109 106 99 108 114
56 111 68 56 86 93 86 57 95 82 126 93 113 54 72 110


54 81 60 76 65 90 81 85 88 106 93 101 86 109 96 NA
4 77 81 90 77 80 83 90 86 97 99 101 100 112 123 107 119
70 72 72 100 94 85 96 88 89 96 98 107 99 103 NA NA
NA NA 52 77 49 82 65 81 62 102 80 118 103 98 97 104


84 82 79 76 84 80 92 89 90 98 98 104 108 89 117 119
80 75 80 76 78 82 93 95 94 99 93 108 105 115 116 113
63 71 78 70 78 84 85 83 87 99 99 102 97 105 102 117
32 31 42 41 50 72 73 73 85 89 105 106 88 106 120 124
86 94 90 96 89 91 99 96 93 102 99 99 106 111 117 116
58 53 63 77 87 99 83 88 94 95 103 102 106 104 108 119
NA NA NA NA 137 75 146 78 160 142 63 95 75 136 114 74


76 74 79 78 85 73 80 101 94 97 99 104 108 106 108 103
55 60 63 73 75 83 90 92 94 97 99 104 108 107 120 127
56 66 72 72 77 84 85 84 91 96 102 102 103 105 NA NA
72 73 79 87 81 96 81 97 109 90 102 108 129 131 136 NA


1 Includes tree crops and all other except forage crops. 2 NA indicates data not available. 3 Field crops only.
4 Does not include fruit.

Sources: Official country data, reports of U.S. agricultural attaches, and other sources by Foreign Regional Analysis Division,
ERS.

Indices which reflect change in the production of livestock and livestock products as
well as crops would be desirable, but were not practicable for this study because of (1) the
lack of reliable estimates, and (2) the difficulties, with available statistics, of making
adjustments needed to take account of feed grain imports and of feed grain transfers from
the crop to the livestock economy.1 Inmostofthe study countries, however, livestock and
livestock products account for relatively small parts of total agricultural production.

1Livestock indices for several of these countries are now being calculated.


I I








Exceptions include Argentina, Chile, Poland, Yugoslavia, Greece, and possibly Japan.
Livestock has become increasingly important in recent years in Japan. This increase,
however, is based on large feed grain imports, and so does not represent a net addition
of equal size to Japan's agricultural production.



Annual Compound Rates of Change in Crop Output

The indices shown in table 3 provided the basis for computing recent rates of increase
in crop production as shown in table 4. In table 4, the countries are arbitrarily divided into
two groups on the basis of the rate of increase in crop output between 1948 and 1963. In
making this distinction, it is recognizedthatathigher levels of general economic develop-
ment, progress in agriculture may be reflected more by transfer of resources from farm
to nonfarm production than by increases in agricultural output. It is also true that for
some countries more recent rates of increase in crop output differ markedly from those
for the full period 1948-63.

During the period 1948-63, the rate of increase in crop production, computed on an
annual compound basis, exceeded 5 percent ayearin 7 of the 26 countries--Israel, Sudan,

Table 4.--Annual percentage rates of change in crop output, 26 countries, 1948-63, 1948-55, and 1955-63

1948-63 1948-55 1955-63

Annual com- Population Annual cha- Annual corn-Annual com- Current Annual c
pound change growth pound change pound change poa co ureti
Country pound change growth po pound change pound change pound change population pon change
in total rate in crop in crop n in total growth n cr
crop output 1950-60 output per i copgrowth
rop output 1950-60 crop output outputper crop output rate tput per
capital2 capital2 capital4

(1) (2) (3) (4) (5) (6) (7) (8)

Group I Percent Percent Percent Percent Percent Percent Percent Percent

Israel........... 9.7 5.2 4.3 15.9 10.7 5.7 3.5 2.1
Sudan............ 8.0 3.4 4.4 10.2 6.8 5.8 2.8 2.3
Mexico............ 6.3 3.1 3.1 8.5 5.4 4.1 3.1 .
Costa Rica....... 5.6 3.9 1.2 4.6 0.7 7.9 4.1 3.7
Philippines...... 5.2 3.2 1.9 8.1 4.9 3.2 3.2 0.O

Tanganyika....... 5.2 1.8 3.3 6.4 4.6 3.1 1.8 1.3
Yugoslavia....... 5.1 1.1 4.0 6.1 5.0 4.3 1.1 3.2
Taiwan............ 4.5 3.4 1.1 5.4 2.0 3.6 2.9 0.7
Turkey........... 4.5 2.9 1.6 6.0 3.1 3.1 2.9 0.2
Venezuela......... 4.5 4.0 0.5 5.0 1.0 4.4 3.4 1.0

Thailand.......... 4.4 3.2 1.2 3.9 0.7 5.4 3.4 1.1
Brazil........... 4.2 3.1 1.1 3.7 0.6 5.2 3.1 2.0
Greece............ 3.7 1.0 2.7 5.7 4.7 1.7 0.9 0.8

Average......... 5.5 3.0 2.3 6.9 3.9 4.5 2.8 1.5

Group II

Iran............. 3.6 2.2 1.4 3.8 1.6 3.3 2.5 3.8
India............ 3.1 2.0 1.1 3.2 1.2 3.0 2.4 3.6
Poland............ 3.0 1.8 1.2 2.4 0.6 3.6 1.8 1.8
Agrentina........ 2.8 1.7 1.1 2.7 1.0 2.9 1.7 1.2
Chile............ 2.8 2.5 0.3 3.0 0.5 2.3 2.3 0.0

Japan.;.......... 2.8 1.2 1.6 4.3 2.1 1.3 1.0 3.3
Spain............ 2.7 0.8 1.9 2.5 1.7 2.9 0.8 2.1
Colombia......... 2.6 2.2 0.4 1.5 -0.7 4.3 2.9 1.4
Nigeria.......... 2.6 3.7 -1.1 2.6 -1.1 2.6 2.0 0.6
UAR.............. 2.0 2.0 -0.4 0.7 -1.7 2.8 2.5 3.3

Pakistan......... 1.8 2.2 -0.4 -0.1 -2.3 2.8 2.2 0.6
Tunisia.......... 1.6 1.8 -0.2 1.8 0.0 1.4 2.1 -0.7
Jordan........... -1.9 2.6 -4.4 -2.2 -4.5 -1.9 2.7 -4.3

Average......... 2.3 2.1 0.2 2.0 -0.1 2.4 2.1 0.4

1 Same as footnote 1, table 2.
2 Assumes 1950-60 population growth rates.
3 Based on U. N. Demographic Yearbook.
4 Assumes current population growth rates.







Mexico, Costa Rica, the Philippines, Tanganyika, and Yugoslavia. It varied from 4 to 5
percent a year in 5 other countries-- Taiwan, Turkey, Venezuela, Thailand, and Brazil.

Per Capita Changes in Crop Output

Over the 1948-63 period, output per capital of total population increased in 21 of the
26 study countries. Six of these countries--Israel, Sudan, Mexico, Tanganyika, Yugo-
slavia, and Greece--had per capital increases of 2 percent or more a year (table 4). Agri-
cultural output per capital of total population declined during this period in Nigeria, Egypt,
Pakistan, Tunisia, and Jordan.

As shown in figures 2 through 5, rates of increase in crop output relative to rates of
population growth have fluctuated widely from year to year in several of the study coun-
tries. Also, for most of the countries, rates of crop output growth for 1948-55 differed
substantially from rates in 1955-63. Sixteen of the 26 countries had higher rates of in-
crease in their crop production in the earlier than in the latter period; 9 had higher rates
in the latter period than in the earlier one; and 1 had the same rate. Countries with higher
rates of increase during 1955-63 include Costa Rica, Thailand, Poland, Argentina, Spain,
Colombia, Egypt, and Pakistan. Because of increases in total crop output and a decline in
population growth rates, 11 of the 26 countries had a higher per capital rate of increase
in their agricultural output in the 1955-63 than in the 1948-55 period.

In general, countries that had the highest rates of increase in 1948-55 had decreased
rates in the latter period. Conversely, countries that had slow rates of growth earlier
experienced more rapid rates after 1955.

In some cases, the early higher rates probably reflect a return to normalcy in coun-
tries where production was disrupted during World War II by either direct involvement in
hostilities or disruption of normal trade channels. However, a few of the countries so
affected--notably Poland, Spain, and Thailand--had slower rates of increase in crop output
during 1948-55 than during 1955-63.

In other cases, the impetus to early increases in output may have been provided by
major agricultural development projects, such as a large new land settlement or irriga-
tion project. But after potentials of these projects are exploited, rates of increase in
crop output decline unless offset by other new development projects.

The earlier rapid rates of increase may also reflect a "catching up" in the exploita-
tion of simple, easily made improvements in agriculturalproduction. Consistent with this
possibility, some of the countries with much higher rates of increase in output in the latter
period may perhaps have gotten a later start in their programs to increase agricultural
productivity. Like those starting earlier, these too may soon exhaust their simple, easily
exploited opportunities for increasing output.
This last hypothesis suggests that once countries "catch up" on simple, easily made
improvement opportunities, their further progress depends uponmajor structural changes,
such as development of improved technologies and improvements in credit, marketing,
educational, and research facilities. In addition to organizing and promotional abilities,
these kinds of improvements require new capital investments and considerable time for
full fruition. There is no inherent reason, of course, why less-developed countries cannot
begin building the foundations for sustained progress, even while using benefits of the
simpler improvement opportunities that they now have.


Changes in Crop Output Relative to Growth in Food Demand

For the period 1948-63, 8 of the 26 study countries had annual compound rates of
increase in crop production exceeding their 1950-60 rate of growth in domestic food
demand. These countries were Israel, Sudan, Mexico, the Philippines, Tanganyika,
Greece, Iran, and Argentina (table 5). Argentina falls in this group, not because of
the successful performance of its agricultural sector, but because of its low population
growth rate combined with little or no increase in per capital income.







Mexico, Costa Rica, the Philippines, Tanganyika, and Yugoslavia. It varied from 4 to 5
percent a year in 5 other countries-- Taiwan, Turkey, Venezuela, Thailand, and Brazil.

Per Capita Changes in Crop Output

Over the 1948-63 period, output per capital of total population increased in 21 of the
26 study countries. Six of these countries--Israel, Sudan, Mexico, Tanganyika, Yugo-
slavia, and Greece--had per capital increases of 2 percent or more a year (table 4). Agri-
cultural output per capital of total population declined during this period in Nigeria, Egypt,
Pakistan, Tunisia, and Jordan.

As shown in figures 2 through 5, rates of increase in crop output relative to rates of
population growth have fluctuated widely from year to year in several of the study coun-
tries. Also, for most of the countries, rates of crop output growth for 1948-55 differed
substantially from rates in 1955-63. Sixteen of the 26 countries had higher rates of in-
crease in their crop production in the earlier than in the latter period; 9 had higher rates
in the latter period than in the earlier one; and 1 had the same rate. Countries with higher
rates of increase during 1955-63 include Costa Rica, Thailand, Poland, Argentina, Spain,
Colombia, Egypt, and Pakistan. Because of increases in total crop output and a decline in
population growth rates, 11 of the 26 countries had a higher per capital rate of increase
in their agricultural output in the 1955-63 than in the 1948-55 period.

In general, countries that had the highest rates of increase in 1948-55 had decreased
rates in the latter period. Conversely, countries that had slow rates of growth earlier
experienced more rapid rates after 1955.

In some cases, the early higher rates probably reflect a return to normalcy in coun-
tries where production was disrupted during World War II by either direct involvement in
hostilities or disruption of normal trade channels. However, a few of the countries so
affected--notably Poland, Spain, and Thailand--had slower rates of increase in crop output
during 1948-55 than during 1955-63.

In other cases, the impetus to early increases in output may have been provided by
major agricultural development projects, such as a large new land settlement or irriga-
tion project. But after potentials of these projects are exploited, rates of increase in
crop output decline unless offset by other new development projects.

The earlier rapid rates of increase may also reflect a "catching up" in the exploita-
tion of simple, easily made improvements in agriculturalproduction. Consistent with this
possibility, some of the countries with much higher rates of increase in output in the latter
period may perhaps have gotten a later start in their programs to increase agricultural
productivity. Like those starting earlier, these too may soon exhaust their simple, easily
exploited opportunities for increasing output.
This last hypothesis suggests that once countries "catch up" on simple, easily made
improvement opportunities, their further progress depends uponmajor structural changes,
such as development of improved technologies and improvements in credit, marketing,
educational, and research facilities. In addition to organizing and promotional abilities,
these kinds of improvements require new capital investments and considerable time for
full fruition. There is no inherent reason, of course, why less-developed countries cannot
begin building the foundations for sustained progress, even while using benefits of the
simpler improvement opportunities that they now have.


Changes in Crop Output Relative to Growth in Food Demand

For the period 1948-63, 8 of the 26 study countries had annual compound rates of
increase in crop production exceeding their 1950-60 rate of growth in domestic food
demand. These countries were Israel, Sudan, Mexico, the Philippines, Tanganyika,
Greece, Iran, and Argentina (table 5). Argentina falls in this group, not because of
the successful performance of its agricultural sector, but because of its low population
growth rate combined with little or no increase in per capital income.







INDICES OF POPULATION, TOTAL CROP
PRODUCTION, AND YIELD OF ANNUAL CROPS


-- Ppulation


Im Total crop production


,.,..i.2. Yield (annual crops)


LATIN AMERICA
% OF 1948-50 BRAZIL
1- 150 --


100 ......
I I:1 1 I I 1 1 1 1 1 1


% OF
150


100-



1501


100


1948-50 -
ARGENTINA






CHILE *

h
-got&
A&J LI 4-


0 I i I I I .I 1 1 50I I I I I I I I I
1948- '52 '56 '60 '64 '48- '52 '56 '60 '64
50 50
3 FIELD CROPS ONLY.
A DUE TO SEVERE DEFICIENCIES IN DATA ON LAND AREA, SERIES ON YIELD HAS NOT BEEN CALCULATED.
U. S. DEPARTMENT OF AGRICULTURE NEG. ERS 3616-65 (4) ECONOMIC RESEARCH SERVICE


Figure 2


150


100-


250


COLOMBIA

I I I







INDICES OF POPULATION, TOTAL CROP
PRODUCTION, AND YIELD OF ANNUAL CROPS
- Population -- Total crop production ,mm,-,, Yield (annual crops)
AFRICA
IF 1948-50 I I I % OF 1948-50 I .


200


150


100.


50


0
300


250


200


150


100-


50


0 1 1 1 1 1 1 I I I I I I0 I I I I I I I I I I 1
1948- '52 '56 '60 '64 '48- '52 '56 '60 '64
50 50
DUE TO SEVERE DEFICIENCIES IN DATA ON LAND AREA, SERIES ON YIELD HAS NOT BEEN CALCULATED.
A YIELD DATA FOR 6 ANNUAL CROPS.
U. S. DEPARTMENT OF AGRICULTURE NEG. ERS 3613-65 (4) ECONOMIC RESEARCH SERVICE


Figure 3
9


NIGERIA *
(%OF 1952-54)


I I


W I II W Il l


TUIA
TUNISIA'&


~I',
g~~I;


-


I


% O







INDICES OF POPULATION, TOTAL CROP
PRODUCTION, AND YIELD OF ANNUAL CROPS
- Population mm Total crop production ""U"I Yield (annual crops)
NEAR EAST AND S.ASIA
)F 1948-50 I I % OF 1948-5.0 ,,' I


150


100-



150

100


200


150


100


50
350


150


100-


1948- '52 '56
50
FIELD CROPS ONLY.
U. S. DEPARTMENT OF AGRICULTURE


'60 '64 '48- '52
50


'56 '60


'64


NEG. ERS 3614-65 (4) ECONOMIC RESEARCH SERVICE


Figure 4
10


I wo
I t"4
I iiii"


PAKISTAN




I I I I I I I I I


%c







INDICES OF POPULATION, TOTAL CROP
PRODUCTION, AND YIELD OF ANNUAL CROPS
Population --- Total crop production Im-III Yield (annual crops)
EUROPE
% OF 1948-50 .I % OF 1948-50 POND
150 oI--ECE 150 I -- -


SPAIN
150 "


100 -
i I J I I I I I I i I I


200


150


100


FAR EAST


II ...$ I
I- WB,,^-, --------'---



THAILAND



I -., ," ,,,''""
I --------


200


150


100.
2f I


UvV
TAIWAN

150


10 0


1948- '52
50


'56 '


U. S. DEPARTMENT OF AGRICULTURE


60 '64 '48- '52 '56 '60 '64
50
YIELD DATA FOR 6 ANNUAL CROPS.
NEG. ERS 3615-65 (4) ECONOMIC RESEARCH SERVICE


Figure 5

11


YUGOSLAVIA 1J4
(% OF 1950-52)
--v

,, ,


150


100




200


150


100


1









Table 5.--Difference between rate of increase in crop output and domestic food demand growth rates, 26 study countries
and United States, selected periods

Crop output


Group I

Israel..........
Sudan...........
Mexico.........
Costa Rica......
Philippines.....

Tanganyika......
Yugoslavia......
Taiwan..........
Turkey..........
Venezuela.......

Thailand........
Brazil .........
Greece .........

Average.......

Group II

Iran............
India ..........
Poland..........
Argentina.......
Chile...........

Japan ..........
Spain ..........
Colombia........
Nigeria ........
UAR. ............

Pakistan........
Tunisia.........
Jordan .........

Average.......

United States...


Percent


Percent


Percent


Percent


Percent


Persen-


-5.6


Source: Based on data in tables 2 and 4.



Since 1955, crop output relative to growth in domestic food demand has dropped in
several of the study countries. Some of these, such as Japan, Israel, and Venezuela, now
produce enough industrial products to exchange some of them in world markets for food
to feed their growing population. In still predominantly agricultural countries, however,
the failure of increases in agricultural output to keep up with growth in domestic demand
can hardly help but slow down general economic growth.


The above observations indicate that, to achieve general economic development,
several of the study countries need to direct greater effort to increasing their agricul-
tural output, and perhaps to solving their population growth problems as well. Although
the recent record of several countries is disappointing, the successful experiences of a
few warrant the hope that, with appropriate policies and programs, underdeveloped
countries can substantially increase their agricultural output and productivity in the
decade ahead. This hope is bolstered by the fact that these successes and near successes
have been achieved by countries which differ widely in their soil and climatic conditions,
historical backgrounds, ethnic, educational, and other cultural features, man-land ratios,
and proximity and accessibility to major world markets. Moreover, some of the crops
through which these successes have been achieved are widely grown in both temperate
and tropical climatic zones (Chapter 2).








Elements Associated With Differences in Levels and Rates of Change in
Agricultural Output

Limitations in available information have in some cases necessitated reliance on
rather crude indicators of the factors underlying differences among the study countries
in their level and rates of increase in crop output. For instance, the level and changes in
the amount of fertilizers per hectare of arable land are used as measures of relative
level and changes both in variable agricultural capital and in applied technology.



Differences in Output Per Agricultural Worker

Because of data limitations, the gross value of agricultural production per agricul-
tural worker has been calculatedfor only 19 of the 26 countries (table 6, column 1). In U.S.
dollars, the 1960 output (including both crops and livestock) per worker varied among
these 19 countries from highs of $1,825 and $1,080 in Israel and Argentina, respectively,
to a low of $94 in Thailand. Output per worker had a value of from $500 to around $655
in 5 other countries--Spain, Poland, Chile, Colombia, and Venezuela. It was $402 per
worker in Japan. In Japan, agriculture is closely intertwined with small-industry opera-
tions, a setup which permits much part-time farming. Hence, agricultural output of many
Japanese agricultural workers is substantially augmented bytheir earnings from nonfarm
sources. In India, the Philippines, Pakistan, and Thailand, value of output per worker was
less than $200.


Table 6.--Agricultural output per agricultural worker and factors associated with differences in output, 19 study countries, 1960

Rank of
Infant icul- Fertili- Urban country Agricul- Gross
Total Arable tural tural
cultural land per land per lliter- motal- workers erused population in miles domestic
output ity per hec- as a of road output product
Country pr capital of agricul- acy per hec- tare o a per hec- produ
per total tural rate4 rates tare o f percentage per 1,0 tare of per
farm pop o per arable of total sq. mi capital1
worker population worker 1,0005 arable arepopulations of1
lanlan dand7 population of land arable
area9 land'0
area

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11)

Metric
Group I Dollars Hectares Hectares Percent Number Number tons Percent Rank Dollars Dollars

Israel..... 1,825 0.9 4.1 6 32.0 0.31 80.5 77.3 3 557 905
Argentina.. 1,080 12.5 13.1 14 59.6 .07 NA 67.0 16 78 465
Spain...... 656 1.6 4.4 18 51.6 .23 31.6 NA 7 150 372
Poland..... 616 1.0 2.4 5 74.7 .41 49.0 48.1 2 252 538
Chile...... 547 9.1 9.3 20 118.0 .11 17.0 67.2 12 59 405

Colombia... 531 7.7 1.9 38 100.0 .51 NA NA 18 270 248
Venezuela.. 500 12.5 3.2 48 64.1 .30 3.8 66.1 17 150 650
Japan...... 402 0.4 0.4 2 37.7 2.39 303.7 63.5 1 961 337
Greece..... 391 1.6 1.9 20 41.4 .52 38.0 42.5 5 205 297
Mexico..... 369 5.6 4.1 35 77.7 .30 9.4 50.7 11 110 321

Average.. 692 5.3 4.5 21 65.7 0.52 66.6 60.3 9 279 454

Group II
UAR......... 365 3.7 0.6 80 130.1 1.76 87.0 37.7 15 643 155
Turkey..... 326 2.7 2.6 61 NA .39 1.5 37.8 13 127 254
Yugoslavia. 250 1.4 1.8 23 98.5 .57 28.0 NA 4 141 179
Brazil..... 229 11.1 1.4 51 NA .45 13.0 45.1 14 104 145
Taiwan..... 228 0.3 0.6 46 34.2 2.10 203.8 59.5 6 477 97
' Pakistan... 182 1.0 1.5 81 NA .73 3.2 NA 10 133 64
Philippines 181 1.0 1.2 25 82.6 .77 12.5 42.7 9 139 113
India...... 114 0.7 1.2 76 145.9 .80 2.3 17.9 8 91 70
Thailand... 94 1.9 0.9 32 54.8 1.13 2.3 11.8 19 106 84
Average... 222 2.6 1.3 53 91.0 0.97 39.3 36.1 11 218 129


SFrom column 3, table 49.
2 Calculated from FAO Production Yearbooks.
3 Calculated from data in column 3, table 49.
4 Calculated from data in table 54.
5 From table 52.
6 From column 13, table 67.


7 Calculated from data in FAO Production Yearbook, 1961.
8 From column 2, table 71.
9 Data from U.N. Compendium of Social Statistics, 1962.
10 From column 10, table 67.
11 From column 3, table 67.








Elements Associated With Differences in Levels and Rates of Change in
Agricultural Output

Limitations in available information have in some cases necessitated reliance on
rather crude indicators of the factors underlying differences among the study countries
in their level and rates of increase in crop output. For instance, the level and changes in
the amount of fertilizers per hectare of arable land are used as measures of relative
level and changes both in variable agricultural capital and in applied technology.



Differences in Output Per Agricultural Worker

Because of data limitations, the gross value of agricultural production per agricul-
tural worker has been calculatedfor only 19 of the 26 countries (table 6, column 1). In U.S.
dollars, the 1960 output (including both crops and livestock) per worker varied among
these 19 countries from highs of $1,825 and $1,080 in Israel and Argentina, respectively,
to a low of $94 in Thailand. Output per worker had a value of from $500 to around $655
in 5 other countries--Spain, Poland, Chile, Colombia, and Venezuela. It was $402 per
worker in Japan. In Japan, agriculture is closely intertwined with small-industry opera-
tions, a setup which permits much part-time farming. Hence, agricultural output of many
Japanese agricultural workers is substantially augmented bytheir earnings from nonfarm
sources. In India, the Philippines, Pakistan, and Thailand, value of output per worker was
less than $200.


Table 6.--Agricultural output per agricultural worker and factors associated with differences in output, 19 study countries, 1960

Rank of
Infant icul- Fertili- Urban country Agricul- Gross
Total Arable tural tural
cultural land per land per lliter- motal- workers erused population in miles domestic
output ity per hec- as a of road output product
Country pr capital of agricul- acy per hec- tare o a per hec- produ
per total tural rate4 rates tare o f percentage per 1,0 tare of per
farm pop o per arable of total sq. mi capital1
worker population worker 1,0005 arable arepopulations of1
lanlan dand7 population of land arable
area9 land'0
area

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11)

Metric
Group I Dollars Hectares Hectares Percent Number Number tons Percent Rank Dollars Dollars

Israel..... 1,825 0.9 4.1 6 32.0 0.31 80.5 77.3 3 557 905
Argentina.. 1,080 12.5 13.1 14 59.6 .07 NA 67.0 16 78 465
Spain...... 656 1.6 4.4 18 51.6 .23 31.6 NA 7 150 372
Poland..... 616 1.0 2.4 5 74.7 .41 49.0 48.1 2 252 538
Chile...... 547 9.1 9.3 20 118.0 .11 17.0 67.2 12 59 405

Colombia... 531 7.7 1.9 38 100.0 .51 NA NA 18 270 248
Venezuela.. 500 12.5 3.2 48 64.1 .30 3.8 66.1 17 150 650
Japan...... 402 0.4 0.4 2 37.7 2.39 303.7 63.5 1 961 337
Greece..... 391 1.6 1.9 20 41.4 .52 38.0 42.5 5 205 297
Mexico..... 369 5.6 4.1 35 77.7 .30 9.4 50.7 11 110 321

Average.. 692 5.3 4.5 21 65.7 0.52 66.6 60.3 9 279 454

Group II
UAR......... 365 3.7 0.6 80 130.1 1.76 87.0 37.7 15 643 155
Turkey..... 326 2.7 2.6 61 NA .39 1.5 37.8 13 127 254
Yugoslavia. 250 1.4 1.8 23 98.5 .57 28.0 NA 4 141 179
Brazil..... 229 11.1 1.4 51 NA .45 13.0 45.1 14 104 145
Taiwan..... 228 0.3 0.6 46 34.2 2.10 203.8 59.5 6 477 97
' Pakistan... 182 1.0 1.5 81 NA .73 3.2 NA 10 133 64
Philippines 181 1.0 1.2 25 82.6 .77 12.5 42.7 9 139 113
India...... 114 0.7 1.2 76 145.9 .80 2.3 17.9 8 91 70
Thailand... 94 1.9 0.9 32 54.8 1.13 2.3 11.8 19 106 84
Average... 222 2.6 1.3 53 91.0 0.97 39.3 36.1 11 218 129


SFrom column 3, table 49.
2 Calculated from FAO Production Yearbooks.
3 Calculated from data in column 3, table 49.
4 Calculated from data in table 54.
5 From table 52.
6 From column 13, table 67.


7 Calculated from data in FAO Production Yearbook, 1961.
8 From column 2, table 71.
9 Data from U.N. Compendium of Social Statistics, 1962.
10 From column 10, table 67.
11 From column 3, table 67.







Data in table 6 on factors associated with these differences in output per worker
yield no one simple explanation for the differences. Generally, however, the top 10 coun-
tries in value of output per worker had much more arable land per worker than did those
in the lower part of this array (table 6, column 3). Use of fertilizer inputs per hectare of
land as a measure of variable capital inputs generally and as a rough indicator of level of
applied technology shows that 7 of the 10 top countries were well above average in their
inputs of variable capital, whereas among the 9 lower countries in this array, only 2 were
above average (table 6, column 7). Use of literacy levels as a measure of educational
levels, shows that, in 7 of the top 10 countries, 70 percent or more of the population over
15 years of age was literate, whereas only 2 of the 9 countries in the lower part of the
array had similar literacy rates (table 6, column 4).

Exceptions to these general relations can be accounted for by one or more other
compensating factors. For example, Japan had only 0.4 hectare of arable land per worker,
compared with 13.1 in Argentina and 4.1 in Israel (table 6, column 3). But in inputs of
variable capital per hectare of land (based on use of fertilizers), Japan ranked among the
top 2 or 3 countries of the world (column 7). Its inputs of nonconventional capital (in the
form of improved technologies and investments in the human factor) in agriculture are
probably the highest per hectare of arable land of any country in the world. Thus, in
Japanese agriculture, capital invested in both conventional andnonconventional inputs has
become a tremendously important substitute for land. It accounted for output valued (in
U.S. dollars) at close to $1,000 per hectare, compared with only $91 per hectare in India;
this was the case even though the natural fertility of land is as high in India as in Japan.
If, in 1960, India had had as high a value of output per hectare of arable land as Japan, its
value of output per agricultural worker would have been about $1,150 instead of $144.

Generally, a high value of output per agricultural worker is associated with a rela-
tively high level of general economic development, as measured by gross domestic product
per capital of total population (table 6, column 11). This is so because of the interdepend-
ence between farm and nonfarm sectors in the processes of development. Each sector
contributes to development of the other, making for larger rates of growth than would be
possible if either operated singly. Growth in the nonfarm sector leads to larger markets
for agricultural commodities and, generally, to increases in the supply of manufactured
production requisites--such as implements, fertilizer, and pesticides--available to
farmers. Hence, farmers in the more highly developed countries have important advan-
tages over producers in less-developed countries.

Countries ranking high in value of agricultural output per farm worker also stand
apart from the others in their infrastructure features, such as roads and other transport
facilities, electric power facilities, hospitals, schools, and research institutions. While
these features are essential for development, they are as much products of, as contribu-
tors to, development.


Differences in Rates of Increase in Crop Output

Increases in a country's agricultural output are a function of changes in the quantity
and quality of its human resources, land, capital, technical knowledge, and production
incentives. These factors are reflected in or influenced by price-cost relations, tenurial
arrangements, tax practices, and other things affecting relations between effort and its y
rewards. If one country increases its agricultural output at a more rapid rate than do
others, it does so because it excels the others in improving this complex of factors,
because of unique circumstances giving it a larger potential for progress than other
countries possess, or because of the willingness of its leaders and people to make greater
effort and sacrifices.

Data on 20 factors associated with recent increases in crop output in the study
countries for 1948-63 are shown in table 7.








Table 7.--Annual rate of change in crop output and associated resource and market factors, 26 study countries, selected periods

Land features Human resource features Capital and credit features
Annual
rate of Arable Increase Gross fixed Annual growth Growth in
u change land Increase Popu- Ilit- H h in ferti- capital for- in volume of cooperative
Country in crop expansion in area lation H h liners per nation in agricultural credit
output poten- of growth era ondi hectare of agriculture credit from societies
1948-63 tia2 crops3 rate4 arable per agricul- institutional membership
land7 tural worker, sources, 1950-6010
1953-618 1953-619 1950-60


(1)


(4) (5)


Percent Rating1 ------------Percent----------- Rating21 K. Dollars ------------Percent--------

9.7 4 68.5 5.2 4 1 81.5 673 3.6 NA
8.0 1 49.9 3.4 93 3 2.2 NA NA NA
6.3 3 49.7 3.1 35 2 8.9 NA 3.3 37
5.6 NA NA 3.9 21 2 64.2 NA NA NA
5.2 4 66.9 3.2 25 2 2.7 4 17.2 59

5.2 1 58.8 1.8 93 3 NA NA NA NA
5.1 4 6.8 1.1 23 1 36.5 66 NA NA
4.5 4 11.7 3.4 43 1 101.9 30 NA 4
4.5 4 62.0 2.9 61 2 2.1 NA 5.6 105
4.5 1 54.0 4.0 48 2 3.6 178 0.8 NA

4.4 3 29.5 3.2 32 2 1.7 1 NA 4
4.2 1 54.6 3.1 51 3 8.7 NA 6.4 NA
3.7 4 22.3 1.0 20 1 66.6 29 7.1 NA

5.5 2.83 44.6 3.0 42 1.92 31.7 140 5.5 42



3.6 2 38.6 2.2 85 NA NA NA NA NA
3.1 4 26.0 2.0 76 3 2.8 3 18.3 232
3.0 4 -0.9 1.8 5 1 33.4 NA NA NA
2.8 1 2.7 1.7 14 1 0 NA NA NA
2.8 3 14.0 2.5 20 2 8.4 NA 18.8 NA

2.8 4 0.9 1.2 2 1 125.3 47 23.7 -1
2.7 NA 3.1 0.8 13 1 22.6 NA NA NA
2.6 1 11.5 2.2 38 3 6.2 NA 0.4 NA
2.6 NA NA 3.7 89 3 NA NA NA 592
2.0 3 6.2 2.4 80 3 62.7 19 7.5 190

1.8 NA 13.9 2.2 81 3 5.5 6 NA NA
1.6 4 14.7 1.8 84 1 0 NA 4.2 NA
-1.9 NA -7.5 2.6 68 2 1.5 NA NA NA


Group I

Israel .......
Sudan........
Mexico .......
Costa Rica...
Philippines..

Tanganyika...
Yugoslavia...
Taiwan.......
Turkey.......
Venezuela ...

Thailand.....
Brazil .......
Greece.......

Average....

Group II

Iran.........
India........
Poland .......
Argentina....
Chile........

Japan........
Spain ........
Colombia.....
Nigeria......
UAR .........

Pakistan.....
Tunisia.......
Jordan .......

Average....


10.3 2.1 50 2.00


29.8 19 9.1


Technological features Tenure features Avail- Annual
Market- ability F i- rate of
Increase Percentage Ferti- increase
Increase Agricul- Agricultural Percentage Tenure ing of lizer in
Country in crop tural re- extension and improve- fail- production prices domestic
output search and Seed conditions ities requdo tic
per acre programs education status4 of 1rogam 6 sites food
of crops during tenancy pdemand20
1948-63ii 1950's12 programsl3 tenancy demand20


(19) (20)


Group I

Israel .......
Sudan........
S Mexico.......
Costa Rica...
Philippines..

Tanganyika..
' Yugoslavia...
Taiwan .......
Turkey .......
Venezuela ...

Thailand.....
Brazil .......
Greece .......

Average....


Percent --------------------------------------Rating2 ------------------------------------------ Percent


1 1 1 1 1 6.58
3 1 3 2 1 3.91
1 1 1 1 NA 4.20
2 2 1 2 NA 6.12
3 2 2 2 2 4.48


116.3 1
74.8 2
29.0 2
NA 2
12.6 2

16.9 3
35.5 2
43.8 1
16.4 2
6.4 3

31.1 2
6.5 3
43.3 2


36.1


3 2
2 2
2 2


2.08


1.33 2.00


1.62 1.85


3 4.93
NA 4.43
1 3.30


1.77 1.88 4.86


See footnotes at end of table.


2.3 2.89


(11) (12) (13) (14) (15) (16) (17) (18)







Table 7.--Annual rate of change in crop output and associated resource and market factors, 26 study countries, selected
periods--Continued

Technological features Tenure features Avail- A
vai rate 3f
Market- ability Ferti- in a
Country Increase in Agricultural Agricultural Percentage Tenure ing of lizer
crop output research extension Seed and improve- facil- production prices 19 dCsti
per acre programs and status'4 conditions ment ities1 requi- doestc
of crops during education of 1 programs16 sites18 od2
1948-6311 1950'S12 programs13 tenancy15 desmd20
(11) (12) (13) (14) (15) (16) (17) (18) (19) (20)

Group II Percent ---------------------------------------Rating2-------------------------------------------- Percent
Iran......... 18.8 3 3 3 3 2 2 3 3 2.24
India........ 14.3 2 3 2 3 2 3 2 3 3.36
Poland....... 41.3 2 1 1 2 1 2 1 U_ 5.10
Argentina.... 23.5 2 2 2 2 3 1 1 ?L 1.68
Chile........ 15.7 2 3 NA 2 2 1 3 NA 3.C5
Japan........ 31.2 1 1 1 1 1 1 1 2 5.61
Spain........ 36.9 2 3 NA 2 2 1 2 1 2.98
Colombia..... 48.3 3 3 NA 3 2 2 3 NA 3.46
Nigeria...... NA 3 2 NA 3 3 3 3 NA 4.92
UAR........... 22.3 2 3 2 1 1 3 2 3 4.C.2
Pakistan..... 11.9 2 2 2 2 2 3 3 1 2.44
Tunisia...... -34.4 3 1 1 2 2 3 2 NA 2.9C
Jordan....... -2.5 3 2 3 1 1 2 1 A 3.70

Average.... 18.9 2.31 2.23 1.89 2.08 1.85 2.08 2.08 2.17 3.53


1 From column 1, table 4.
2 From table 14.
3 From table 9.
4 From table 2.
5 From table 54.
6 From table 52.
7 From table 35.
8 Data provided by FAO.
9 Data provided by FA0.
10 Data provided by FAO.
11 From table 9.


12 Estimates based on available data.
13 Estimates based on available data.
14 From column 2, table 45.
15 Estimates based on data presented in Chapter 4.
16 Estimates based on data in Chapter 4 and on other reports reviewed by staff.
17 From column 2, table 73.
18 From data provided by USAID missions, see Appendix II, table 83.
19 Based on data in table 40 and on data from FAO reports.
20 From table 2.
21 In all ratings in this table, the lower numbers represent the more favorable
situation and the higher numbers the less favorable situation.


Each of the study countries has its own unique combination of human, land, and
capital resources and technical possibilities, as well as its own distinct institutional,
social, and political features. Hence, it would logically follow that the proportionate
combination of changes in resource patterns needed to maximize rates of increase in
agricultural production would differ from country to country. It is probably for this
reason that we do not find a highly consistent relationship between changes in any onr
factor and rates of, change in crop output. What we do find is a tendency for countries
with a rapid rate of increase either to excel in a fairly large number of the factors or to
excel greatly in one or two important factors. Israel, for example, had substantial in-
creases in area of crops (table 7, column 3), in variable and fixed capital per hectare of
arable land, in level of applied technology (table 7, column 11), and in the size of its agri-
cultural labor force (table 7, column 5). It also ranked high in educational and health levels
(table 7, columns 5 and 6).

In contrast to Israel's balanced approach, the progress of the Philippines and Tan-
ganyika appears to have been achieved by heavy emphasis upon expanding their area under
cultivation. During the 1950's, neither of these countries made large improvements in level
of applied technology, in use of variable capitalper unit of land, or in the educational level
of its human resources.

At the farm level, increases in crop output have been mainly a function of increases
in number of agricultural workers, in area of crops, and in amounts of both variable and
fixed capital, and improvements in the level of applied technology. In most of the study
countries, each of these four factors accounts for at least part of the increases in crop
output. As indicated above, relative importance of changes in these four factors differed
greatly from country to country and no one proportionate combination differentiated the
rapid-growth from the slow-growth countries. Nevertheless, during the 1950's rapid-
growth countries generally excelled slow-growth countries in the magnitude of changes







made in most of these factors. For example, when countries were arrayed by rate of
increase in crop output per year, those in the upper half of the array (Group I) had an
average increase in area of crops of 44.6 percent, compared with 10.3 percent for those
in the lower half (column 3, table 7). Gross fixed capital formation per agricultural
worker was $140 for countries in the upper half, compared with $19 for those in the
lower half (column 8, table 7).

Over a longer period of time, investments in education and in nutrition and health
would probably have further differentiated rapid from slower rates of growth. These
kinds of investments, like those in research and in other such institutions, however,
require a considerable amount of time for their full fruition. In the short time period
covered by this study, it is doubtful that differences among countries in improvements in
the human agent account for much of the differences in their rates of increase in crop
output.

In less-developed countries, large resource changes at farmlevels are seldom made
unless accompanied or preceded by large improvements in the infrastructure of roads,
marketing facilities, credit agencies, research and educational institutions serving farm
people. Some countries also require large improvements in incentives to producers,
price-cost relations, tenurial arrangements, and tax policies.

Available information on the extent to which these kinds of improvements have been
made in the study countries is even more limited than that on factors entering directly
into production at farm levels. Such evidence as is available, however, shows that rapid
rates of increase in crop output have not just been a consequence of normal economic and
social processes in societies organized on a laissez-faire basis. Rather, they have been
undergirded by aggressive group action--generally national in scope--which has been
directed specifically to improving agricultural service facilities. Such action has included
major land development programs, especiallythe opening up of new lands and the develop-
ment of irrigation facilities in Israel, Sudan, Mexico, the Philippines, Taiwan, and Brazil
(table 7); major land reform programs in Japan, Taiwan, and, in earlier decades, in
Mexico; and increasing emphasis on agricultural education in Israel, Sudan, Mexico,
Taiwan, and Greece. Expanded programs of agricultural research have been particularly
important in improving the technological basis of agricultural production in Mexico,
Taiwan, and Japan. Significant improvements in agricultural credit facilities have been
made in Mexico, the Philippines, and Taiwan. The extension of improved roads which
have more fully opened large new areas to a market economy has been largely respon-
sible for increasing crop output in Turkey, especially for that made between 1948 and
1955.

Countries with more rapid rates of increase in crop output also had higher rates of
increase in domestic food demand. Rates of increase in domestic food demand for the upper
and lower groups, respectively, were 4.74 percent and 3.50 percent (column 20, table 7).
The former group of countries had an average annual rate of increase in per capital
incomes of 3.25 percent, compared with an average of 2.34 percent for countries having
the slower rate of increase. These observations suggest that growth in the agricultural
sector is often needed to facilitate growth in the rest of the economy and vice versa.


Differences in Crop Yield Increases

S Estimates which distinguish between increases in area of crops and in crop yields as
sources of increases in crop output have been developed for 22 of the 26 study countries.
Increases in area of crops were the more important source of crop output increases in
10 of the 22 countries and crop yield increases were more important in 12 (table 8).
Many countries, particularly in Latin America and Central and South Africa, still have
sizeable land expansion potentials (table 14). Many other countries, however, will have
to achieve their increases in output mainly through increases in crop yields. Even in
some countries with sizeable land expansion potentials, increasing yields may be the
better means of increasing their agricultural output. Yet, most countries making rapid
progress had substantial increases in both area of crops and crop output per unit of land.







In terms of their physical and technical bases, recent yield increases in the study
countries have been achieved mainly through increased use of fertilizers, use of im-
proved crop varieties, more effective pest controls, improvements in planting, tillage, and
harvesting methods, and better use of water resources. Often, improvements have been
made as part of a system of improved production practices. Some of these changes have
provided additional employment for labor and have required some additional capital.

Available information is too sketchy for precise measurement of the relative contri-
bution of these factors to the increases made in crop yields during the last decade. Under
the assumption of the rather high incremental response ratio of 10 pounds of grain to
1 pound of fertilizer, increased use of fertilizers probably does not account for more than
20 percent of the increases in grain yields made in India, for example. The use of pesti-
cides is still too limited to have accounted for more than 4 to 5 percent of these yield
increases. If we consider all purchased inputs, including improved seeds, it appears that
the larger part of the recent yield increases in India has come about mainly through
simple improvements requiring few purchased inputs, such as better spacing of plants,
better weed control, and better tillage practices. These are kinds of improvements that
are effected by technical assistance and agricultural education programs.

Most countries in the early stages of agricultural development have these kinds of
yield-increasing opportunities. Exploitation of these opportunities canbe strategic to their
economic development, but by themselves these opportunities cannot bring the less-
developed countries very far up the yield-increasing scale. Rather, large progress in
increasing yields depends on purchased inputs and on kinds of inputs produced through
investments in research and agricultural extension.














CHAPTER 2.--SOURCES OF CHANGE IN CROP OUTPUT
This section is concerned with the physical resource and commodity basis of recent
changes in crop output inthe study countries. Such information has a bearing on some very
important hypotheses, as those relating to the existence of cheap sources of output in-
creases and those relating to the availability of adaptable technologies and crops for
increasing output in tropical and semitropical regions.
Annual data on the land area associated with the output of each crop indicate the
following sources of change in crop production: (1) Changes in area of crops; (2) changes
in crop pattern as from high- to low-value crops, or vice versa; and (3) changes in crop
yields (table 8). Estimates of how much of the changes in output have come from changes

Table 8.--Sources of recent changes in production of field crops for 22 study countries,
selected yearsi

Annual Source of change
rate of
Country Time span increase Area
Crop Crop Total
in crop of Total
output2 crops3 pattern yield

Group I Years Percent Percent Percent Percent Percent

Israel........... 1948-63 9.7 25.8 -2.6 76.8 100.0
Sudan............ 1948-62 8.0 30.8 22.2 47.0 100.0
Mexico........... 1948-60 6.3 53.4 -0.1 46.7 100.0
Philippines...... 1948-62 5.2 76.0 5.4 18.6 100.0
Tanganyika........ 1948-63 5.2 68.7 4.7 26.6 100.0
Yugoslavia........ 1948-63 5.1 15.2 5.6 79.2 100.0

Taiwan........... 1948-61 4.5 19.3 -3.5 84.2 100.0
Turkey........... 1948-63 4.5 70.0 -0.6 30.6 100.0
Venezuela......... 1953-62 4.5 84.6 -18.6 34.0 100.0
Thailand.......... 1948-62 4.4 42.2 13.5 44.3 100.0
Brazil........... 1948-62 4.2 84.3 1.5 14.2 100.0
Greece........... 1948-62 3.7 29.6 6.5 63.9 100.0

Group II

Iran.............. 1948-63 3.6 59.7 13.4 26.9 100.0
India............ 1948-62 3.1 59.1 8.0 32.9 100.0
Poland........... 1948-63 3.0 -2.3 26.9 75.4 100.0
Argentina........ 1948-63 2.8 10.0 18.6 71.4 100.0
Chile............ 1948-63 2.8 43.7 26.4 .29.9 100.0

Japan............ 1948-63 2.8 2.8 20.2 77.0 100.0
Spain............ 1948-61 2.7 7.5 14.8 77.7 100.0
Colombia......... 1948-62 2.6 17.6 -3.2 85.6 100.0
UAR.............. 1948-63 2.0 20.7 7.7 71.6 100.0
Pakistan.......... 1948-63 1.8 50.7 14.2 35.1 100.0

1 Data on land area in crops are not available for Costa Rica and Nigeria. Year-to-year
variations in agricultural production in Jordan and Tunisia have been too erratic for
statistically reliable results.
2 Annual compound rates for field crops and other crops combined.
3 Includes multiple cropping.







in land area are based on the assumption that newly cultivated land is of the same
quality as that already in use. These estimates are expressed in value aggregates and
have been computed on a crop-by-crop basis; they take into account changes in land area
but assume no change in crop yields. The residual of the total change in value is ascribed
to yield increases.


Change in Area of Crops

Increases in area of crops have been made in all of the study countries for which
land area data are available, except in Poland. They account for more than half of the
observed increases in crop production in four of the more rapid-growth (or Group I)
countries--Mexico, Venezuela, Brazil, and Tanganyika. These increases in acres of
crops are partly accounted for by increases in the production of two or more crops per
year on the same land, but the larger part probably reflects increases in area under
cultivation. All of these countries except Mexico still have large areas of unused land of
known potential for agricultural production (Chapter 3). Argentina had only a 10-percent
increase from this source; so by itself the mere availability of such land does not insure
expansion of agriculture.

Land resources needed to feed man adequately exist in most of the world's under-
developed countries. This is especially true in most of Central and South Africa, the
Philippines, and South America where much potentially suitable land is not being used.
Under present conditions, use of much of this land is not economically feasible. Tech-
nological advances, however, as well as shifts in the demand for food, may extend the
economic margins of cultivation to include much of this land. Yield-increasing and labor-
saving innovations, improved roads and transport facilities, and eradication of disease
and insect pests, may particularly help to extend cultivable areas.

Rapid population growth in the densely populated Asian countries has become a source
of apprehension. Although these countries have relied less upon expanding land area to
increase production than have African and Latin American countries, considerable
expansion of the area of crops has occurred in India, Pakistan, and even Egypt. In these
and other densely populated countries, it is unlikelythat reorganization of producing units
to bring additional land into use will continue to make large contributions to increasing
agricultural production. Rather, these countries will need to emphasize increased output
per unit of land now in use. One way of doing this is to grow two or more crops per year
on land where now only one crop is grown.

Data presented in table 8 on sources of increased output do not by themselves indi-
cate the extent of changes that have been made in land area, yields, and crop patterns.
Generally, however, countries in which crop area was the major source of change in
output were also countries with substantially increased acres of crops (table 9). For
example, from 1948-50 to 1961-63, Brazil increased its land area by 55 percent; Mexico
by 50 percent; Venezuela by 54 percent; and Turkey by 62 percent. Taiwan, which is one
of the world's most densely populated agrarian nations, increased its area of crops by 12
percent during this period. In most cases, increases in acres of crops were accompanied
by increases in yields; the combination of these factors created rapid rates of increase
in production. Multiple cropping probably accounts for some of these increases.


Change in Crop Patterns

Crop patterns have shifted from low- to high-value crops in about three-fourths of
the countries and from high to lower value crops in about one-fourth. Such shifts have not
accounted much for increases in total value of crop output.

Information on the commodity composition of changes in crop production is presented
in table 10 for 24 of the study countries. Among the upper half of the countries, several
kinds of crops account for a fifth or more of the total increases in value of crop produc-
tion in one or more countries. These include maize in Mexico and Yugoslavia; wheat in







in land area are based on the assumption that newly cultivated land is of the same
quality as that already in use. These estimates are expressed in value aggregates and
have been computed on a crop-by-crop basis; they take into account changes in land area
but assume no change in crop yields. The residual of the total change in value is ascribed
to yield increases.


Change in Area of Crops

Increases in area of crops have been made in all of the study countries for which
land area data are available, except in Poland. They account for more than half of the
observed increases in crop production in four of the more rapid-growth (or Group I)
countries--Mexico, Venezuela, Brazil, and Tanganyika. These increases in acres of
crops are partly accounted for by increases in the production of two or more crops per
year on the same land, but the larger part probably reflects increases in area under
cultivation. All of these countries except Mexico still have large areas of unused land of
known potential for agricultural production (Chapter 3). Argentina had only a 10-percent
increase from this source; so by itself the mere availability of such land does not insure
expansion of agriculture.

Land resources needed to feed man adequately exist in most of the world's under-
developed countries. This is especially true in most of Central and South Africa, the
Philippines, and South America where much potentially suitable land is not being used.
Under present conditions, use of much of this land is not economically feasible. Tech-
nological advances, however, as well as shifts in the demand for food, may extend the
economic margins of cultivation to include much of this land. Yield-increasing and labor-
saving innovations, improved roads and transport facilities, and eradication of disease
and insect pests, may particularly help to extend cultivable areas.

Rapid population growth in the densely populated Asian countries has become a source
of apprehension. Although these countries have relied less upon expanding land area to
increase production than have African and Latin American countries, considerable
expansion of the area of crops has occurred in India, Pakistan, and even Egypt. In these
and other densely populated countries, it is unlikelythat reorganization of producing units
to bring additional land into use will continue to make large contributions to increasing
agricultural production. Rather, these countries will need to emphasize increased output
per unit of land now in use. One way of doing this is to grow two or more crops per year
on land where now only one crop is grown.

Data presented in table 8 on sources of increased output do not by themselves indi-
cate the extent of changes that have been made in land area, yields, and crop patterns.
Generally, however, countries in which crop area was the major source of change in
output were also countries with substantially increased acres of crops (table 9). For
example, from 1948-50 to 1961-63, Brazil increased its land area by 55 percent; Mexico
by 50 percent; Venezuela by 54 percent; and Turkey by 62 percent. Taiwan, which is one
of the world's most densely populated agrarian nations, increased its area of crops by 12
percent during this period. In most cases, increases in acres of crops were accompanied
by increases in yields; the combination of these factors created rapid rates of increase
in production. Multiple cropping probably accounts for some of these increases.


Change in Crop Patterns

Crop patterns have shifted from low- to high-value crops in about three-fourths of
the countries and from high to lower value crops in about one-fourth. Such shifts have not
accounted much for increases in total value of crop output.

Information on the commodity composition of changes in crop production is presented
in table 10 for 24 of the study countries. Among the upper half of the countries, several
kinds of crops account for a fifth or more of the total increases in value of crop produc-
tion in one or more countries. These include maize in Mexico and Yugoslavia; wheat in







Table 9.--Recent changes in area of crops, crop output per unit of land, and crop yields
for field crops, 22 study countries, selected years


Annual rate Changes in--
Country Time span of increase Crop output Cr
in crop Area of per uunt yop
per unit yields
output' crops of land2


Group I Years Percent Percent Percent Percent

Israel............. 1948-63 9.7 68.5 116.3 120.4
Sudan............... 1948-62 8.0 49.9 74.8 50.8
Mexico.............. 1948-60 6.3 49.7 29.0 28.9
Philippines........ 1948-62 5.2 66.9 12.6 9.8
Tanganyika.......... 1948-63 5.2 58.8 16.9 14.4

Yugoslavia.......... 1948-63 5.1 6.8 35.5 33.2
Taiwan.............. 1948-61 4.5 11.7 43.8 45.7
Turkey.............. 1948-63 4.5 62.0 16.4 16.7
Venezuela.......... 1953-62 4.5 54.0 6.4 14.1
Thailand........... 1948-62 4.4 29.5 31.1 23.8

Brazil.............. 1948-62 4.2 54.6 6.5 5.9
Greece............. 1948-62 3.7 22.3 43.3 39.3

Group II

Iran............... 1948-63 3.6 38.6 18.8 12.5
India............... 1948-62 3.1 26.0 14.3 11.5
Poland.............. 1948-63 3.0 -0.9 41.3 30.4
Argentina........... 1948-63 2.8 2.7 23.5 18.6
Chile.............. 1948-63 2.8 14.0 15.7 8.3

Japan.............. 1948-63 2.8 0.9 1.2 24.7
Spain............... 1948-61 2.7 3.1 36.9 31.0
Colombia........... 1948-62 2.6 11.5 48.3 50.2
UAR................. 1948-63 2.0 6.2 22.3 20.1
Pakistan........... 1948-63 1.8 13.9 11.9 8.5


1 Annual compound rates for field crops and other crops combined.
2 Includes combined influence of changes in crops and changes in yields.



Yugoslavia, Turkey, and Greece; rice in the Philippines and Taiwan; millet in Sudan; root
crops--mainly yams and cassava--in Venezuela; sugar cane inthe Philippines; vegetables
and fruits in Israel; coffee in Costa Rica and Brazil; and cotton and other fibers in Israel,
Sudan, Tanganyika, and Mexico.

These same kinds of crops are important to the economy of the slow-growth countries.
For example, maize is grown extensively in Argentina and Chile; wheat in Iran, Poland,
Argentina, Chile, Spain, and Egypt; rice in India; potatoes and yams or other root crops
in Poland, Chile, and Nigeria; sugar crops in Poland and India; vegetables and fruits,
including citrus, in Spain, Iran, Colombia, and Egypt; coffee, tea, and cocoa in Colombia
and Nigeria; and cotton in Iran, Colombia, and Egypt. In fact, about 75 percent of all of
the crops grown in the study countries measured in value terms are grown in both tropical
and temperate climatic zones.









Table 10.--Distribution, by crops, of changes in total crop output, 24 countries arrayed by compound annual rate
of increase in crop production, 1948-63

Annual Percentage distribution of the change in value of crop output by kind of crops
rate of
Country change he Sorghum IPotatoes Other Annual
in all Maize Wheat Rice a s nd Pulses and root oilseed
crops ere illets yams crops ps crops

Group I .................-- --------------------------Percent--------------------- -- ------

Israel................. 9.7 -0.1 4.2 -- 1.6 2.9 -0.2 7.1 -- 5.6
Sudan .................. 8.0 0.7 0.7 21.6 7.2 29.1
Mexico................. 6.3 25.8 9.2 1.2 0.6 -- 6.0 1.3 -- 5.6 5.7
Costa Rica............. 5.6 3.2 -- 8.0 -- 2.4 -- 6.8 --
Philippines............ 5.2 9.6 -- 28.8 -- 1.3 3.0 2.6 22.0 0.1

Tanganyika ............ 5.2 12.4 1.0 5.8 -- -- -- -- -- 3.2
Yugoslavia ............ 5.1 31.8 27.0 -- 2.9 -- 2.2 12.0 -- 3.4 1.C
Taiwan ................ 4.5 0.7 2.2 47.8 -- 0.2 1.2 9.5 0.8 9.0 10.2
Turkey ................ 4.5 -- 29.6 0.3 16.0 -0.1 1.9 7.1 -- 4.5 3.2
Venezuela .............. 4.5 11.4 -0.2 1.4 -- -- -2.1 12.8 4.5 16.7 5.9
Thailand............... 4.4 9.1 -- 20.1 -- -- 1.1 -- 8.8 6.4 6.9
Brazil................. 4.2 13.2 -0.9 18.9 0.2 -- 5.8 3.4 5.5 9.8 6.C
Greece................. 3.7 2.4 47.2 2.5 2.0 -- 4.6 3.4 -- -- --
Group II

Iran ................... 3.6 -- 25.7 7.0 4.9 -- 2.9 -- 4.9 7.8
India.................. 3.1 4.0 14.0 32.5 0.9 5.4 7.7 13.5 10.3

Poland................. 3.0 -- 12.4 -- 16.2 -- -0.5 38.5 -- 12.7 5.9
Argentina............. 2.8 17.3 6.9 0.9 1.7 0.7 -0.6 8.5 -- 8.0 13.3
Chile.................. 2.8 14.7 36.5 1.2 10.3 -- 6.9 33.4 -- -3.2
Japan.................. 2.8 0.3 0.7 52.5 -3.3 -0.6 3.5 4.0 -- 1.2 5.0
Spain ................. 2.7 0.3 0.3 0.1 -- 0.1 0.3 -- --

Colombia............... 2.6 3.2 2.1 13.0 3.0 -- -1.1 6.2 -- 1.6 3.6
Nigeria ............... 2.6 2.4 -- 2.4 -- 12.7 2.5 13.7 9.4 0.2 19.5
UAR.................... 2.0 12.6 13.8 16.0 0.1 2.7 2.8 6.8 -- 9.7 4.8
Pakistan ............... 1.8 1.3 4.7 48.5 -0.3 0.2 -0.9 -- -- 21.1 9.5

Percentage distribution of the change in value of crop output by kind of crops

Country Vegetables Olives, Coffee,
and, palms, Nut tea, Tobacco Rbber Cotton Other Other Total
fruits coconut, crops and fibers crops
and copra cocoa


Group I ------------------------------------ ---------Percent ----------------------------- --

Israel................. 62.1 0.7 -- -- -- 16.1 -- 100.C
Sudan.................. 0.3 -- 40.4 -- 100.0
Mexico................. 7.9 3.6 -- 8.7 1.5 -- 22.1 0.8 -- 100.0
Costa Rica.............. 0.5 -- 79.1 -- -- -- -- 100.0
Philippines............ 11.3 9.7 -- 5.7 5.3 0.6 -- 100.0

Tanganyika ............. -- 14.6 0.4 -- 24.8 37.8 -- 100C.
Yugoslavia............. 18.6 -- 0.4 -- 1.5 -- -0.8 -- 100.0
Taiwan................ 10.1 2.3 3.0 -- 0.5 1.3 1.2 100.0
Turkey.................. 19.3 4.0 2.0 -- 1.6 -- 10.6 -- -- 1C.O
Venezuela.............. 14.1 -1.3 -- -7.2 4.6 -- 8.9 30.5 -- 100.

Thailand .............. -- 9.1 -- 12.4 14.7 1 1.7 9.7 -- 100.C
Brazil ................. 9.9 0.9 -- 18.6 0.9 -- 6.3 1.4 0.1 1O0.C
Greece................. 11.1 5.0 -- 13.4 -- 8.4 -- -- OO.C
Group II

Iran.................... 22.0 0.4 0.9 0.8 -0.8 -- 23.5 -- 1CO.
India.................. -- 0.7 -- 2.1 1.2 0.2 4.8 2.7 -- 10C.C

Poland................. 12.1 -- -- -- 2.7 -- -- -- 00.0
Argentina .............. 38.3 -- 2.5 -- 1.6 -- 0.9 100.0
Chile.................. -- -- -- -- 0.2 -- -- -- -- 100.0
Japan .................. 28.5 -- -- 3.0 5.2 -- -- 100.0
Spain .................. 61.0 37.3 0.3 -- 0.3 -- 100.0

Colombia............... 8.9 -- -- 40.7 1.4 -- 17.2 0.2 -- 100.0
Nigeria................ 3.5 0.2 0.7 21.8 0.4 6.9 3.7 -- 100.0
UAR ................... 21.2 -- -- -- 9.5 -- 00C.0
Pakistan............... -- 3.7 -- 10.3 1.9 -- 100.0

1 Includes cottonseed.








Some crops which account for sizeable increases in agricultural production in rapid-
growth countries can also be adapted to and extensively grown in slow-growth countries.
Therefore, the differences between slow-growth and rapid-growth countries may lie less
in differences in the kind of crops they can grow than in differences in other factors. The
substantial progress made in such countries as Sudan, the Philippines, Taiwan, Mexico,
and Costa Rica indicates that careful consideration needs to be given to the role of public
action at national, state, and local levels inincreasing farm production incentives, freeing
the energies and powers of decision of farm people, and providing an infrastructure of
facilities and services. The aggressiveness and effectiveness with which countries com-
pete for a share of world markets must also be considered in this context.



Change in Crop Yields

Change in yields per unit of land is now the best available indicator of changes in
resource productivity for underdeveloped countries. Crop yields have increased since
1948 in all of the study countries. Generally, countries with above-average rates of
* increase in value of total crop production have also had higher than average rates of
increase in crop yields (tables 9, 11, and 12). Leaders in yield increases include Israel,
Sudan, Mexico, Taiwan, Greece, Yugoslavia, and Thailand. Among the more rapid-growth
countries, only Brazil, Tanganyika, Venezuela, the Philippines, and Turkey have failed
to achieve substantial yield increases. These countries have brought considerable areas
of new land under cultivation, some of which may have been of low quality.



Table 11.--Indices of crop output per unit of land, 26 study countries, 1948-63

(1957-59 = 100)1


Area and country


Latin America
Argentina ..................
Brazil....................
Chile.......................
Colombia2...................
Costa Rica2................
Mexico.....................
Venezuela...................

Africa
Nigeria ....................
Sudan ................... ..
Tanganyika.................
Tunisia ....................

Europe
Greece................... ..
Poland4...................
Spain .......................
Yugoslavia..................

Near East and So. Asia
UAR. .....................
India....................
Iran ......................
Israel......................
Jordan ........ ...........
Pakistan ...................
Turkey ............. ......

S Far East
Japan....................
Philippines.................
Taiwan ....................
Thailand....................


1948 1949 1950 1951 1952 1953 1954 19195 1956 1957 1958 1959 1960 1961 1962 1963


--------------------------------------------Percent---------------------------------------------


90 92 88
101 96 100
91 85 74
NA NA NA
NA NA NA
76 83 80
(3) (3) (3)

NA NA NA
58 66 71
62 67 70
82 169 169


64 73 68
80 82 92
76 69 74
NA NA 56


94 93 88
104 91 93
68 89 96
NA 55 45
144 158 116
97 100 96
92 79 96


88 83 84
90 97 97
65 73 78
91 90 88


95 95 97 103 95
101 Q99 98 99 Q


78 84
NA NA
NA NA
81 81
(3) (3)

NA NA
78 98
71 81
95 147


72 69
79 84
97 93
84 52


84 97
88 88
79 88
33 59
119 152
99 95
112 114


82 88
106 107
77 81
92 93


91 93
NA NA
NA NA
82 93
88 92


NA NA
80 97
71 74
133 102


85 80
86 92
77 97
84 69


87 91
89 97
92 93
60 75
81 158
96 99
119 89


76 82
108 115
89 90
100 84


95 95 102 103 101 107 113
94 100 99 101 103 107 106
95 94 107 91 92 99 96
NA NA NA NA NA NA NA
NA NA NA NA NA NA NA
94 101 103 96 108 103 108
98 100 98 103 91 100 101


NA NA NA NA NA NA NA
116 94 103 102 96 131 112
97 95 102 103 104 104 106
94 94 105 102 88 62 127


82 104 98 98 93 96 104
99 100 99 101 110 127 111
91 97 98 105 94 100 NA
68 104 80 116 109 92 97


88 97 99 104 108 93 111
95 99 94 106 102 114 112
92 99 100 102 98 103 99
92 106 95 99 93 98 125
139 143 43 114 81 109 76
92 102 100 98 102 108 110
92 103 100 97 103 96 101


92 96 99 105 109 108 114
102 100 102 98 106 103 112
94 98 102 101 102 107 NA
108 98 103 99 118 117 116


111


1 Changes result from combined influence of changes in crop patterns and in crop yields.
2 Due to severe deficiencies in data on land area, series on yield have not been calculated.
3 Data incomplete or not available.
4 Data for 6 annual crops.







Table 12.--Classification of countries by rates of increase in area of crops and crop
yields, 24 study countries, arrayed by 1948-63 rate of increase in crop production

Countries in upper Countries in lower
half of distribution half of distribution
Annual rate by increase in area by increase in area
of increase of crops and in-- of crops and in--
Country in crop
output Upper half Lower half Upper half Lower half
of increase of increase of increase of increase
in yields in yields in yields in yields

Percent

Israel............. 9.7 x
Sudan.............. 8.0 x
Mexico............. 6.3 x
Philippines........ 5.2 x
Tanganyika......... 5.2 x x
Yugoslavia......... 5.1 x
Taiwan............. 4.5
Turkey............. 4.5 x
Venezuela.......... 4.5 x
Thailand........... 4.4 x
Brazil............. 4.2 x
Greece............. 3.7 x
Iran............... 3.6 x
India.............. 3.1 x
Poland............. 3.0 x
Argentina.......... 2.8 x
Chile.............. 2.8 x
Japan.............. 2.8 x
Spain .............. 2.7 x
Colombia........... 2.6 x
UAR................. 2.0 x
Pakistan........... 1.8 x



Yield-Increasing Methods

It is not possible here to indicate quantitatively the resource basis of the observed
increases in output per unit of land, except in Greece. The most important methods of
effecting these increases have been shifts to irrigation farming and increased use of
fertilizers, pesticides, and improved seeds. Increases in land under irrigation have par-
ticularly accounted for Mexico's output gains; in Israel, all increases in farmed areas
consist of land brought under irrigation; and irrigation is similarly responsible for the
gains made by Sudan. Sudan and Israel are examples of countries where increases in
land area under cultivation and increases in yields commonly occur together. In these
areas, irrigation often increases output per unit of land by making multiple cropping
economically feasible. Moreover, placing land under irrigation is commonly associated
with increased dependence upon the market economy and with increased use of purchased
inputs, such as fertilizers, pesticides, and improved seeds, as well as with improved
tillage practices.

Estimates for Greece between 1950 and 1960 ascribe about 8 percent of the increases
in crop production to increases in land area and 92 percent to changes in output per unit
of land (table 13). Bringing land under irrigation was the most important factor in these
increases (33 percent).






Table 13.--Estimated contribution of selected factors to the increase in crop production,
Greece, 1950-60

Factor Contribution Factor Contribution


Percent Percent

Land' ...................... 7.6 Other4 .................... 42.2
Irrigation2 ................ 33.1
Fertilizers3................ 17.1 Total.................. 100.0

1 Assuming the average "productivity" of land remained the same.
2 Assuming yield of land irrigated was 3.3 times that not irrigated. Based on information
in C. Evelpidis, "Irrigation in Greece," Internatl. Jour. Agrarian Affairs, Oxford Univ.
Press, London, Jan. 1963. The land factor in irrigation (as a result of increasing amounts
of land under irrigation) was removed in the computation.
3 Assuming a 33-percent increase in yields for each 60 kilograms of fertilizer used;
based on 1959 FAO Mission report on Greece.
4 Technical improvements, such as better seed selection, crop rotation, use of pesti-
cides, etc.

In most of the study countries, yield increases on other than newly irrigated land
have apparently been achieved by adoption of simple, yield-increasing improvements
involving little if any additional cash expenditures. In most countries, increases in uses
of purchased inputs have been too small for these to have accounted for more than 30 to
50 percent of the yield increases observed since 1948--even assuming quite high re-
sponses for such inputs (see Chapter 5).

At early development stages, cheap sources of yield increases are probably avail-
able to farmers in most study countries. These cheaper sources include shifts to row
planting of cotton, maize, rice, and many crops now grown broadcast; better weed con-
trol; improvements in other tillage practices; and increased timeliness and care in crop
harvesting. Exploitation of such sources can increase the farmer's capacity to finance
more costly sources of output increases.

The supply of relatively cheap sources of yield increases can be appreciably expanded
through research. Variety improvements have been one of the cheaper new sources of
yield increases produced in the United States, Mexico, Japan, and some other countries
through research. Similar research is still in the infancy stage in most of the world's
underdeveloped countries.












CHAPTER 3.--LAND AND OTHER NATURAL FEATURES

The productivity of land for agricultural uses is increasingly becoming a function of
advances in agricultural technology and of the greater capital and skills technology re-
quires. Thus far, scientific and engineering research has been heavily concentrated in a
few economically advanced countries such as the United States, Germany, and Japan. For
this reason, natural resource differences are important at early stages of development.
Differences in the natural resource bases of underdeveloped countries may account
significantly for differences in their agricultural output and short-run growth potentials.
This importance will likely decline as progress is made in agricultural technology.


Agricultural Land Area and Expansion Potentials

Soil surveys suitable for agricultural planning exist principally for economically
advanced nations. Among the study countries, soils have been mapped in detail on a country
basis only in Japan and Israel. They have been mapped for broader interpretations in
some provinces of Greece, Yugoslavia, Taiwan, the Philippines, Tunisia, Venezuela,
Colombia, Chile, Brazil, and Nigeria (Kellogg, 30).2 Knowledge of soil resources for
other study countries is extremely scanty.

Because of these limitations in knowledge of soils, World Soil Maps have been used
for rating the study countries according to their agricultural land expansion potentials
(table 14). These maps delineate broad soil groups on a country basis for 23 of the study
countries.

Estimates of the amount of potentially arable land in each country are based on the
world average potential for each soil group as shown in table 15; in the case of alluvial
soils, estimates are based on the assumption that 50 to 80 percent are potentially arable
(fig. 6). Such estimates obviously do not take account of intercountry differences in the
soil groups. Neither do they account for the cost of bringing new lands into arable farm
uses relative to their productivity. More importantly, they do not consider moisture
limitations. At best, therefore, such estimates must be taken as long-run expansion
potentials whose economic feasibility will depend upon growth in needs for food, initial
costs of bringing such lands into use, technological advances, and even prospects of
increasing output on land now in use.

Potentials for expansion of the arable land area in terms of area alone are relatively
large in Brazil, Colombia, Venezuela, Argentina, Tanganyika, Sudan, and Iran.'If we dis-
regard immediate economic feasibility, these countries could expand their arable land
area by 75 percent or more. Economic feasibility of such expansion under present condi-
tions is probably very low in countries as Iran and Sudan because of moisture limitations.
Both of these countries have sizeable areas where sufficient water could make the soils
productive. Some of the potentially arable land will require modern machinery, relatively
large amounts of fertilizers, drainage, and irrigation before it can be made highly
productive.

Potentials for expanding arable land area are lowest (under 25 percent) in the Philip-
pines, Japan, Taiwan, Tunisia, Poland, India, Israel, Yugoslavia, Greece, and Turkey.
Since 1948, Turkey has plowed up much of the land that should have been left for grazing.

Estimates of arable land expansion potentials range from 25 to 75 percent in Chile,
Mexico, Thailand, and Egypt. Water limitations make this estimate almost meaningless for
Egypt.

2 Underscored numbers in parentheses refer to items in the Bibliography, p 122.












CHAPTER 3.--LAND AND OTHER NATURAL FEATURES

The productivity of land for agricultural uses is increasingly becoming a function of
advances in agricultural technology and of the greater capital and skills technology re-
quires. Thus far, scientific and engineering research has been heavily concentrated in a
few economically advanced countries such as the United States, Germany, and Japan. For
this reason, natural resource differences are important at early stages of development.
Differences in the natural resource bases of underdeveloped countries may account
significantly for differences in their agricultural output and short-run growth potentials.
This importance will likely decline as progress is made in agricultural technology.


Agricultural Land Area and Expansion Potentials

Soil surveys suitable for agricultural planning exist principally for economically
advanced nations. Among the study countries, soils have been mapped in detail on a country
basis only in Japan and Israel. They have been mapped for broader interpretations in
some provinces of Greece, Yugoslavia, Taiwan, the Philippines, Tunisia, Venezuela,
Colombia, Chile, Brazil, and Nigeria (Kellogg, 30).2 Knowledge of soil resources for
other study countries is extremely scanty.

Because of these limitations in knowledge of soils, World Soil Maps have been used
for rating the study countries according to their agricultural land expansion potentials
(table 14). These maps delineate broad soil groups on a country basis for 23 of the study
countries.

Estimates of the amount of potentially arable land in each country are based on the
world average potential for each soil group as shown in table 15; in the case of alluvial
soils, estimates are based on the assumption that 50 to 80 percent are potentially arable
(fig. 6). Such estimates obviously do not take account of intercountry differences in the
soil groups. Neither do they account for the cost of bringing new lands into arable farm
uses relative to their productivity. More importantly, they do not consider moisture
limitations. At best, therefore, such estimates must be taken as long-run expansion
potentials whose economic feasibility will depend upon growth in needs for food, initial
costs of bringing such lands into use, technological advances, and even prospects of
increasing output on land now in use.

Potentials for expansion of the arable land area in terms of area alone are relatively
large in Brazil, Colombia, Venezuela, Argentina, Tanganyika, Sudan, and Iran.'If we dis-
regard immediate economic feasibility, these countries could expand their arable land
area by 75 percent or more. Economic feasibility of such expansion under present condi-
tions is probably very low in countries as Iran and Sudan because of moisture limitations.
Both of these countries have sizeable areas where sufficient water could make the soils
productive. Some of the potentially arable land will require modern machinery, relatively
large amounts of fertilizers, drainage, and irrigation before it can be made highly
productive.

Potentials for expanding arable land area are lowest (under 25 percent) in the Philip-
pines, Japan, Taiwan, Tunisia, Poland, India, Israel, Yugoslavia, Greece, and Turkey.
Since 1948, Turkey has plowed up much of the land that should have been left for grazing.

Estimates of arable land expansion potentials range from 25 to 75 percent in Chile,
Mexico, Thailand, and Egypt. Water limitations make this estimate almost meaningless for
Egypt.

2 Underscored numbers in parentheses refer to items in the Bibliography, p 122.





Table 14.--Selected statistics on land expansion potentials of study countries,
selected years


Country


Brazil.......
Sudan .......
Tanganyika...
Colombia .....
Venezuela....
Argentina ...
Iran.........

S UAR...........
Thailand .....
Chile.........
Mexico.......


Year


Arable
land
expansion
potentials


Total land
now in
arable use


Rating' Percent


1957
1954
1960
1960
1960
1957
1960

1961
1960
1956
1950


Country


Japan.........
Philippines..
Taiwan.......
Tunisia ......
Poland.......

India.........
Israel.......
Yugoslavia...
Greece.......
Turkey ......


Year


Arable
land
expansion
potentials


Total land
now in
arable use


Rating1 Percent


1960
1961
1960
1957
1961

1958
1961
1960
1960
1961


1 The ratings I, II, III, and IV indicate increases in land expansion over area now in
use of more than 150 percent, 75-149 percent, 25-74 percent, and under 25 percent,
respectively.


Table 15.--Estimates of potentially arable land in the world, by soil groups

Percentage Area
Soil groups potentially potentially
arable arable

Percent Mil. acres

1. Prairie soils, degraded chernozems....................... 80.0 242
2. Chernozems and reddish chestnut ......................... 70.0 660
3. Dark gray and black soils of subtropics and tropics..... 50.0 618
4. Chestnut, brown, and reddish brown ...................... 30.0 892
5. Sierozems, desert....................................... .5 34
6. Podzols and weakly podzolized ........................... 10.0 320
7. Gray-brown podzolic ..................................... 65.0 972
8. Latosols, red-yellow podzolics .......................... 35.01 2,780
9. Red-yellow mediterranean............................... 15.0 41
10. Soils of mountains ...................................... .5 30
11. Tundra .................................................. .0 0

Source: Adapted from Kellogg (30).


Significantly, expansion in area of crops has been an important source of crop output
increases mainly in those countries with large land expansion potential (tables 8 and 14).
However, land expansion potential must not be mistaken for agricultural output expansion
potentials. For example, Japan's agricultural output in 1960 was $961 per hectare of
arable land, compared with only $91 for India and $78 for Argentina. These comparisons
indicate much more fully than do land expansion potentials the magnitude of the agricul-
tural output expansion potentials in less-developed countries.






































Ni'_. .



1 *2'" \\



.. : .. I...* k ..... .. 1 V _' > :1 I \ ....\ /
.. ,:... ....... i ._ _..*.*




A 'F.4 ,1 J a1 *T i 'W u \ ..

MAY 1956


Figure 6.--Map of the world showing six broad soil zones. Each of these has generally similar processes of horizon differentiation prevailing over it.
These are reflected in the character of the well-drained soils with undulating to the rolling topography. Many kinds of soils in addition to the dominant ones
are present in every zone.








Differences in Quality of Soil Resources


The worth of soils for agricultural uses canvary greatly among countries, depending
upon the country's fund of technological knowledge, and the conditions affecting supplies
and prices of other production factors and the demand for agricultural products. In terms
of their physical productivity when first plowed or while technology is still in a rudi-
mentary stage, the world's major soils have been classified as follows:

Most favorable: Prairie soils; degraded chernozems; chernozems; reddish chestnut
soils; gray-brown podzolic soils; alluvial soils.

Moderately favorable: Dark gray and black soils of thetropicsand subtropics; siero-
zem soils; desert soils; chestnut soils; brown soils; and
reddish-brown soils.

Fairly favorable: Latosolic soils: red-yellow podzolic soils; red-yellow mediter-
ranean soils; podzols.

The "most favorable" category includes the best soils found in temperate areas and
alluvial soils in both temperate and tropical climatic zones. "Moderately favorable"
includes mediocre soils of temperate climates and some of the better soils of the tropics.
"Fairly favorable" includes the least responsive of tropical and temperate climate soils.

Countries with more than 65 percent of their potentially arable soils in the most
favorable group are rated "1". Countries with less than 65 percent of their potentially
arable soils in the most favorable category, butwith 75 percent in the most favorable and
moderately favorable categories combined are rated "2". Other countries are rated "3".

It is not surprising that countries having the highest ratings generally rank lowest in
their arable land expansion potentials (tables 16 and 17). Argentina is an exception.


Table 16.--Ratings on quality of potentially arable land and
21 study countriesi


potential for expansion,


Quality of Arable land Quality of Arable land
Country2 potentially expansion Country2 potentially expansion
arable land3 potential4 arable land3 potential4

Rating Rating Rating Rating

Greece........... 1 IV Sudan.......... 2 I
UAR.............. 1 III Iran........... 2 II
Yugoslavia....... 1 IV Chile.......... 2 III
Taiwan........... 1 IV
Poland........... 1 IV Japan.......... 3 IV
Argentina........ 1 I Thailand....... 3 III
Turkey........... 1 IV Venezuela...... 3 I
Tanganyika..... 3 I
Mexico........... 2 III Philippines.... 3 IV
Tunisia.......... 2 IV Brazil......... 3 I
India............ 2 IV Colombia....... 3 I
Israel........... 2 IV

1 Ratings of 1, 2, and 3 indicate most favorable, moderately favorable, and least favor-
able, respectively.
2 Groupings are based on quality of potentially arable land.
3 From standpoint of adaptation of productive crop culture with current world knowledge
of agricultural techniques.
4 See footnote 2, table 14.








Table 17.--Expansion and quality ratings of soil resources in representative countries

Country xpnsion Soil Reasons
rating quality


Yugoslavia.


Colombia...









Thailand...











UAR ........


1 Expansion: Yugoslavia's current arable land amounts to
30 percent of the nation's total area. This is about
equal to Yugoslavia's maximum potential arable land
under good soil management practices. Over half of the
country's soils are not suitable for agricultural pro-
duction or are suitable only for sparse grazing. Many
unsuitable soils currently are being used and erosion
is resulting. Quality: Of soils potentially arable
under good soil management practices, Yugoslavia has a
high proportion of very productive types. Black, loamy
chernozem soils, fertile brown forest soils, moderately
leached giay-brown podzolics, and drained alluvial
soils make up the bulk of the country's arable soils.
2 Expansion: As Tunisia is an arid country, water is the
foremost barrier to expansion of arable land. But, even
if all of Tunisia's known water resources were ex-
ploited, only a small addition would be made to cur-
rently arable land. Quality: Soil of oases make up an
important part of the country's arable land. Centuries
of manure and water have made these soils highly pro-
ductive. Alluvial soils and the deeper desert soils
are moderately productive in northern Tunisia where
rainfall is highest.
3 Expansion: Current arable land in Colombia is under 10
percent. Perhaps one-fifth of the country is poten-
tially arable. So, although agricultural production is
undesirable on over half of the land (primarily because
of steep, shallow mountain soils), a substantial oppor-
tunity for expansion remains. Quality: Most of Colum-
bia's potentially arable soils are latosols. These
soils have rarely supported a highly productive agri-
culture.
3 Expansion: About one-fifth of Thailand is currently
arable land, and about one-third of the country's land
seems potentially arable. Quality: Alluvial soils and
latosols each constitute somewhat less than 50 percent
of Thailand's potentially arable soils. The bulk of the
difference is dark tropical clays. Thailand's alluvial
soils are highly productive with irrigation, fertilizer,
and drainage. Sandy ferruginous latosols are very in-
fertile but can be used for wet rice. The dark tropical
clays are productive but become very sticky when wet
and extremely hard when dry.
1 Expansion: Egypt currently uses only 3 percent of its
land area for agricultural production. Virtually all of
this is arable land. Compared to current use, large
amounts of good soil remain unexploited. Water is the
main limiting factor. Estimates of potential arable
land must be based on assessment of water resources.
With large water reserves under the desert, perhaps an
additional 2 percent of total land area can be brought
into production. Quality: Nearly all Egypt's arable
land is fertile alluvial soil irrigated from the Nile.








In a developing world, technical knowledge and capital to invest in land development
activities crucially affect soil productivity. In some cases, drainage makes formerly
unusable soils highly productive. Deep plowing may turn previously unworkable clay
soils into high-yielding land. But usually, high productivity results from a combination
of techniques and inputs. The cultivation system has to be modified to overcome the
limitations and enhance the potentials of a given soil and the environment in which it is
found. Plant varieties and fertilizers can be adapted to suit best the peculiarities of a
soil type.
Most of the fundamental research in soil sciences has been done in developed coun-
tries (Ignatieff, 28). These countries are nearly all in the temperate regions'of the world.
Most underdevel'ed countries, and certainly the more impoverished ones, are in tropical
regions.
In their natural state, tropical soils can support tremendous quantities of vegetable
matter per hectare. However, these soils do not have a large reserve of fertility. Plants
of tropical forests thrive on the heat and humidity, but the soil has only a thin layer of
humus. Organic matter decomposes rapidly under tropical conditions; hence, new plants
are nourished by recently fallen plants. When forests are cleared, the humus layer may
completely disappear because of lack of new organic matter.
High temperatures and rainfall encourage loss of soil nutrients from the root zone.
Since the soil water is warm, it can hold large amounts of nutrients in solution. Heavy
and intense rainfall washes the nutrients in solution out of the reach of all except the
most deeply rooted plants.
In areas with dry seasons, water of the subsoil may return to the root zone, carrying
with it metallic hydroxides which form a sterile, impermeable layer known as laterite
(Gourou, 23). Laterization becomes more acute as the dry season lengthens; consequently,
it is progressively more common as one goes from the equator towards large desert
regions.3
Aside from intense leaching, tropical rainfall causes severe erosion, as much because
of its distribution as because of its quantity. Tropical rain tends to come in cloudbursts,
with rain falling for 20 to 40 minutes at the rate of 3 inches per hour.
Tropical climate imposes yet another obstacle. As one moves toward desert regions,
rainfall becomes progressively more erratic. Moreover, the rainy season changes from
year to year. More importantly, the distribution pattern is less predictable, and so com-
plicates soil management problems. The first rains may be followed by a severe dry
period, or most of the season's rain mayfall at the beginning, or alternatively at the end,
of the wet season.
Shifting agriculture was primitive man's approach to the vagaries of tropical soil
and climate; it has continued as a successful means of survival for hundreds of genera-
tions. The farmer disturbs the balance between vegetation and soil as little as possible
by carving only small patches out of the forest and by incomplete clearing. He interplants
a variety of crops to provide foliage protection through the growing season and to hedge
against weather. Nonetheless, fertility under shifting cultivation declines rapidly, and,
after about three seasons, the land is left fallow for 10 or 20 years to regain its fertility.
Thus, shifting agriculture keeps man only one step ahead of complete disaster. As popu-
lation increases, farmers are shortening the fallow periods at the cost of declining yields
and more erosion. The system is incapable of supporting dense populations.

Highly productive agriculture, however, has been developed on some tropical soils.
This has been most often associated with tree and other perennial crops, such as coffee,
rubber, oil palm, bananas, and cocoa. Tree crops minimize soil exposure, and deep tree
roots utilize plant nutrients washed down from the surface.
Where water management is economic, wet rice culture appears to be successful in
the wet tropics in feeding dense populations. Although wet rice cultivation can solve the

3 According to USDA soil scientists, laterite may not be quite as hazardous as some believe. The cultivators of Kerala State in
India somehow learned how to handle these soils over a thousand years ago. They learned how to grow food crops in mixed cultures
without plowing.









problem of increasing densities of population, it merelyforestalls a decline in labor pro-
ductivity. It can, however, absorb increased numbers of cultivators on a unit of cultivated
land (Geertz, 22, p. 32). An additional laborer in the paddy can perform an additional
painstaking practice which will produce enough for his own support.
The rice paddy is one important way of overcoming the limitations of tropical soils.
Flooded ricefields can annually produce enough carbohydrates with minimum of manure;
also, they can be cultivated without fallow periods, risk of erosion, or exhaustion of the
soil (Gourou, 23, pp. 94-5). Other ways of using and improving tropical soils can probably
be developed through experimentation. Although these soils are inherently less productive
than temperate soils, the greatest barrier to increased agricultural productivity in the
tropics is lack of fundamental agricultural research.
Rapid increases in crop production in the 1948-63 period tended to occur in countries
which expanded their cultivated acreage substantially (table 18). Yet the increase in area
of crops was not closely related to the potential for arable land expansion.

Table 18.--Selected production factors related to land characteristics, 21 study countries


Annual rate Potential Quality Per capital i ange
Country of change for arable of gross domestic ied ro ps
in crop land arable product, f co
output' expansion land3 19604 1948 to


Group I Percent Rating2 Rating2 U.S. dollars Percent

Israel........... 9.7 4 2 905 68.5
Sudan............. 8.0 1 2 66 49.9
Mexico............ 6.3 3 2 321 49.7
Philippines...... 5.2 4 3 113 66.9
Tanganyika....... 5.2 1 3 57 58.8

Yugoslavia....... 5.1 4 1 179 6.8
Taiwan............ 4.5 4 1 97 11.7
Turkey............ 4.5 4 1 254 62.0
Venezuela........ 4.5 1 3 650 54.0
Thailand......... 4.4 3 3 84 29.5

Brazil........... 4.2 1 3 145 54.6
Greece........... 3.7 4 1 297 22.3

Group II

Iran............ 3.6 2 2 130 38.6
India............. 3.1 4 2 70 26.0
Poland............ 3.0 4 1 538 -0.9
Argentina........ 2.8 1 1 465 2.7

Chile............. 2.8 3 2 405 14.0
Japan............ 2.8 4 2 337 0.9
Colombia.......... 2.6 1 3 248 3.1
UAR............... 2.0 3 1 155 11.5
Tunisia.......... 1.6 4 2 145 6.2

1 From Chapter 2.
2 Ratings are those shown in table 14.
3 From the standpoint of adoption of productive crop culture with current world knowl-
edge of agricultural techniques. Data are from table 16.
From table 67.
5 From table 9, Chapter 2.





Recent agricultural development patterns in the study countries indicate the possi-
bility of rapid increases in output, even in countries with meager land resources. An
abundance of land resources does not by itself insure development. Development depends
upon what is done with available land resources, including improvement in technical
possibilities, sources of supply of other production requisites, knowledge and skills of
farm people, and incentives to producers as affected by price policies, tenurial arrange-
ments, and other institutional factors.


Climate

Tropical climates favor insect multiplication (Gourou, 23). Fairly constant tempera-
tures and high humidity throughout the year make insect control far more serious in the
tropic than in temperate climates where low winter temperatures help keep insects in check.
Likewise, warm humid climates encourage the multiplication of micro-organisms.
Perishability, another severe problem in the tropics, is one of the major hindrances to
the development of commercial horticulture and animal production. The one advantage of
tropical climate lies in the possibility of multiple cropping where water is available.


Water Resources

Irrigation has long been the basis of agricultural development in arid regions. In
many other countries, it compensates for poorly distributed rain during the growing
season.

Knowledge of the amount of currently irrigated land is quite imprecise (Gamier, 21).
What passes for irrigation in one country is not treated as irrigation in others. For
example, in some countries rain-fed rice paddies and cropland watered by annual floods
are considered irrigated. It is also difficult to obtain satisfactory statistics for any given
level of irrigation, especially in a country where some farmers use wells and some
streams, and where the amount of water used differs greatly from farm to farm.

Irrigation data for various countries for around 1955 are indicated in table 19 and
for 1960 in table 20. Because of changes in definition of irrigated land, however, data for
the two time periods are not highly comparable.

In Egypt, virtually all cultivated land is irrigated because the country lacks sig-
nificant rainfall. Irrigated land is a small proportion of cultivated land in other arid
countries where there is enough rainfall during at least part of the year. Furthermore,
few arid countries have a potential source of irrigation that approaches the Nile. Often,
arid countries find that the most efficient use of meager water resources is to save the
water for livestock and let the livestock graze the vegetation that grows during the rainy
season. This is in addition to raising crops during the rainy season.

The importance of irrigation in a country's agriculture does not depend wholly on its
climate. Egypt would be essentially uninhabitable without irrigation, but as already noted,
other arid countries are able to provide food and fiber without it. In fact, irrigation tends
to be most important in countries with moist climates where, presumably, rainfall is
adequate for most crops. Rice growing is common to most countries where irrigation is
utilized extensively. Much rice is grown in rain-fed paddies; such paddies are usually
considered as irrigated. Higher yields result when water control is more precise as
when it is transferred from a natural source to agricultural land by irrigation.

Table 20 shows maximum potential for irrigation in a few of the study countries.
Significantly, countries which have some idea of their water resources are the most
developed. Few underdeveloped countries have conducted surveys which indicate their
irrigation potential. Furthermore, few countries have begun to approach utilization of all
their available water resources. One exception is Israel, which may be using essentially
all its available water by 1970.





Recent agricultural development patterns in the study countries indicate the possi-
bility of rapid increases in output, even in countries with meager land resources. An
abundance of land resources does not by itself insure development. Development depends
upon what is done with available land resources, including improvement in technical
possibilities, sources of supply of other production requisites, knowledge and skills of
farm people, and incentives to producers as affected by price policies, tenurial arrange-
ments, and other institutional factors.


Climate

Tropical climates favor insect multiplication (Gourou, 23). Fairly constant tempera-
tures and high humidity throughout the year make insect control far more serious in the
tropic than in temperate climates where low winter temperatures help keep insects in check.
Likewise, warm humid climates encourage the multiplication of micro-organisms.
Perishability, another severe problem in the tropics, is one of the major hindrances to
the development of commercial horticulture and animal production. The one advantage of
tropical climate lies in the possibility of multiple cropping where water is available.


Water Resources

Irrigation has long been the basis of agricultural development in arid regions. In
many other countries, it compensates for poorly distributed rain during the growing
season.

Knowledge of the amount of currently irrigated land is quite imprecise (Gamier, 21).
What passes for irrigation in one country is not treated as irrigation in others. For
example, in some countries rain-fed rice paddies and cropland watered by annual floods
are considered irrigated. It is also difficult to obtain satisfactory statistics for any given
level of irrigation, especially in a country where some farmers use wells and some
streams, and where the amount of water used differs greatly from farm to farm.

Irrigation data for various countries for around 1955 are indicated in table 19 and
for 1960 in table 20. Because of changes in definition of irrigated land, however, data for
the two time periods are not highly comparable.

In Egypt, virtually all cultivated land is irrigated because the country lacks sig-
nificant rainfall. Irrigated land is a small proportion of cultivated land in other arid
countries where there is enough rainfall during at least part of the year. Furthermore,
few arid countries have a potential source of irrigation that approaches the Nile. Often,
arid countries find that the most efficient use of meager water resources is to save the
water for livestock and let the livestock graze the vegetation that grows during the rainy
season. This is in addition to raising crops during the rainy season.

The importance of irrigation in a country's agriculture does not depend wholly on its
climate. Egypt would be essentially uninhabitable without irrigation, but as already noted,
other arid countries are able to provide food and fiber without it. In fact, irrigation tends
to be most important in countries with moist climates where, presumably, rainfall is
adequate for most crops. Rice growing is common to most countries where irrigation is
utilized extensively. Much rice is grown in rain-fed paddies; such paddies are usually
considered as irrigated. Higher yields result when water control is more precise as
when it is transferred from a natural source to agricultural land by irrigation.

Table 20 shows maximum potential for irrigation in a few of the study countries.
Significantly, countries which have some idea of their water resources are the most
developed. Few underdeveloped countries have conducted surveys which indicate their
irrigation potential. Furthermore, few countries have begun to approach utilization of all
their available water resources. One exception is Israel, which may be using essentially
all its available water by 1970.





Table 19.--Extent of irrigated land in 23 study countries, circa 1955
r~ *1


Country


Israel.........
Sudan..........
Mexico..........
Philippines....
Tanganyika.....
Yugoslavia.....
Taiwan .........
Turkey ........
Venezuela ......
Thailand.......
Brazil..........
Greece..........


1,000 acres
110
1,523
5,330
1,450

153
1,337
217
77
2,184
346
474


Ratio of
irrigated
to culti-
vated land

Percent
11.2
20.7
9.2
14.8
6----
0.8
61.8
0.6
1.0
16.3
0.1
5.9


Iran..........
India..........
Argentina .....
Chile..........
Japan..........
Spain ........
Colombia ......
UAR ..........
Pakistan .....
Tunisia ......
Jordan .......


1,000 acres
5,000
59,057
2,500
3,212
9,430
863
208
7,- 00
21,3 O.

1-
1:'-


Ratio of
irrigated
to culti-
vated land


Percent

19.9
3.3
20.4
75.6
3.8
3.5
100.0
47.4
1.3


1 Land in which 2 irrigated crops are raised per year are counted twice.
Source: International Commission on Irrigation and Drainage, Irrigation in the World,
New Delhi, 1955.

Table 20.--Irrigated land in 18 study countries, 1960, and planned increases and
potential for irrigation

Estimated
Ratio of Planned irrigated
Country Year Irrigated irrigated to increases in potential as
land1 cultivated irrigated percentage of
land land cultivated
land
1,000 acres Percent 1,000 acres Percent
Israel.......... 1960 334 31.1 -- 54.0
Sudan............ 1963 2,000 -- 200
Mexico........... 1964 10,600 3,000
Costa Rica...... (recent) 37 5.3
Yugoslavia....... 1960 297 1.4 -- 35.9
Venezuela........ 1963 642 5.0
Brazil.......... 1963 865 1.8
Greece........... 1960 899 10.3 -- 32.3
India............ 1959 58,000 20 35,000 44.0
Poland........... 1961 514 1.3 -- 14.5
Argentina........ 1963 2,772 3.7
Chile............ 1963 3,370 24.7 1,200
Japan............ 1960 8,500 57.0
Spain............ 1960 4,524 8.6 -- 21.2
Colombia......... 1963 544 4.3
UAR.............. (recent) 7,000 100 2 2,000
Pakistan........ 1963 27,400 37.7
Tunisia......... 1962 151 -- (3)


1 Land with irrigated crops. Multi-cropped land counted only once.
2 From Nile only.
SMaximum potential estimated at 140,000 acres.
Source: Elco Greenfields, "Water Has a Key Role," Farmer's World, The
Agriculture, 1964, Washington, D. C.


Yearbook of















CHAPTER 4.--LAND TENURE AND SIZE OF HOLDINGS

The relationships among people which determine their rights to the occupancy and
use of land are exceedingly important in societies where land represents the main occu-
pation of the population. Power to control its use is also power to control the lives of the
people who must use it. Itis no mere coincidence, therefore, that during most of recorded
history land tenure systems have been intimately linked to political power structures and
social class lines.

The land tenure system defines social class relations more fully than does any other
institution in most of the world's agrarian countries; it controls or at least limits the
power of choice and action of individuals and families; it is the chief means of rationing
economic opportunity; and it determines the interpersonal distribution of production and
income, and the extent to which general economic incentives become meaningful to the
farm people. 4

For many, the vast importance of tenure relations for the agricultural development
of underdeveloped countries has probably been obscured by observation of recent agri-
cultural progress in the United States under each of several kinds of tenure. The United
States, however, is an economically advanced country, and land is no longer its main
source of economic opportunity. With this decline have come significant changes in the
role of land in the Nation's social and political life. Increasingly, the relationship between
tenants and their landlords has become one between businessmen who are near equals
in their economic, social, and political influence. Increasing alternatives outside of
agriculture have increased the bargaining power of tenants; given them large freedom of
choice; insured them earnings that are reasonably commensurate with their contributions
to output; and helped to insure price incentives which fully reflect prices as expressed
in general markets.

Land tenure patterns vary both among and within the study countries. In some coun-
tries, the dominant tenure system is one of nearly unlimited private ownership of land,
with owners relatively free to use, rent out, or sell their land. In a few countries, land
is held mainly under communal ownership. These patterns are deeply rooted in tradition
and custom, and have been devised to meet needs of a traditional subsistence economy.
Individual users have no alienable rights and only limited rights of a long-term nature.
In still other cases, landownership is vested in the state. Among countries permitting
private ownership of land, some have a wide distribution of ownership and others have
large concentrations of landownership.

Comparative data now available on tenure patterns in the study countries, however,
are limited mainly to those on number of holdings and associated land area by tenure.
These patterns are categorized as "owner-operated," "fixed-rent," "crop share renter,"
and "other forms of tenure" (tables 21 and 22). What each of these categories means in
terms of tenurial rights varies greatly among countries. In some, ownership rights are
fairly comparable to those held by fee-simple owners in the United States. In others,
ownership is limited with respect to size of land holdings and alienation rights. In some
countries, owners may be but "tenants of the king," paying an exorbitant share of their
output in taxes. Tenants may have rights closely approximating those of the owners, or
they may be little more than serfs. The latter condition has been most prevalent in coun-
tries with large concentrations of landownership, where sometimes a single landlord owns
the lands occupied and used by hundreds of villages. In such situations, the landlord has a
monopoly over land resources and near absolute power over the lives of his tenants.

4 For a fuller and more penetrating analysis of the interrelations between land tenure and social and politicalpower structures,
see Parsons, Kenneth H., "Agrarian Reform Policy as a Field of Research," Agrarian Reform and Economic Growth in Developing
Countries. U.S. Dept. Agr., Econ. Res. Serv., Mar. 1962.









Table 21.--Percentage distribution of number of holdings by tenure, 16 study countries,
selected years

Percentage distribution of number of holdings
by tenure (excluding mixed holdings)-- Ann compound
Country Year Rented rate of change
Owner- Other in total crop
operated Fixed Crop forms of output, 1948-63
rent share Total tenure


--------------------------------Percent-----------------------------

Israel........... 1950 42 4 1 5 53 9.7
Mlxico........... 1950 68 2 1 3 29 6.3
Costa Rica....... 1950 91 2 2 5 4 5.6
Philippines...... 1948 58 1 29 1 42 -- 5.2
Taiwan........... 1962 65 -- 14 2 21 4.5
Venezuela......... 1950 42 15 6 21 37 4.5
Thailand......... 1950 83 -- 17 1 4.4
Brazil........... 1950 -- -- 9 10 4.2
Greece........... 1950 96 2 1 3 1 3.7
Iran.............. 1960 34 12 44 56 10 3.6
Chile............ 1955 -- -- -- 2.8
Japan........... 1950 92 -- 7 1 2.8
1960 75 -- 3 22
Argentina........ 1952 41 -- 23 36 2.8
UAR.............. 1950 76 -- 24 -- 2.0
Pakistan......... 1960 54 -- 17 29 1.8
Jordan........... 1953 95 -- 5 -- 1.9


1 Fixed rent and
2 Part owner.


crop share do not add up to the total because of other ways of renting.


Source: Land Tenure: World Agricultural Structure, Study No. 2, FAO, Rome, 1961, and
other data provided by FAO.

Large concentrations of landownership are typical in many less-developed areas of
Latin America, the Middle East, and Asia, where the tenure system has become deeply
involved in economic, political, and social inequality. These are areas in which tenure
problems are creating strong pressures for land reform. Such pressures helped to set
off the Mexican revolution 50 years ago; this was essentially a peasant revolt in a pre-
dominantly subsistence economy which paved the way for the establishment of a repre-
sentative government and recent high rates of economic growth. The ejido form of tenure
of the revolutionary era has been supplemented by privately owned, medium-sized farms
in irrigated areas. In Egypt, the aim of the recent land reform has been to limit the
relatively few persons who had great economic power prior to 1952.

The importance of land reform has beenwidely recognized since the end of World War
II. Several of the study countries have given prominence to land reform measures in their
development programs. Some have achieved striking progress in this field, notably Taiwan,
Egypt, and Iran.

The difficulty of establishing a definitive statistical relationship between tenure pat-
terns and recent agricultural progress is complicated further by the heterogeneity of the
study countries with respect to other variables influencing output. Most of those countries
in which a large percentage of the landholders were owner-operators had average or
above average increases inagricultural output. These include Costa Rica, Japan, Thailand,
Greece, and Mexico, where two-thirds or more of the landholders were classified as
owner-operators. Exceptions include Jordan and the United Arab Republic.





Table 22.--Percentage distribution of holding area by tenure, 13 countries,
selected yearsi

Percentage of holding area by tenure
Annual compound
Rented rate of change
Country Year .Owner Other forms in total crop
operated Fixed Crop Total of tenure output, 1948-63
rent share

----- --------- -Percent ----------------

Israel........... 1950 19 42 3 45 36 9.7
Costa Rica....... 1950 96 NA NA 2 2 5.6
Tanganyika........ 1961 84 NA NA 3 13 5.2
Venezuela........ 1950 83 4 2 6 11 4.5
Thailand.......... 1950 90 NA NA 10 -- 4.4
Brazil........... 1950 89 NA NA 11 -- 4.2
Greece........... 1950 89 5 2 7 4 3.7
Iran............. 1960 26 7 55 62 12 3.6
Chile............ 1955 70 NA NA 23 7 2.8
Japan............ 1960 82 NA NA 1 17 2.8
Colombia.......... 1960 75 NA NA 9 16 2.6
UAR.............. 1950 69 NA NA 31 -- 2.0
Pakistan......... 1960 47 NA NA 24 29 1.8

1 Data not available for Sudan, Mexico, the Philippines, Yugoslavia, Taiwan, Turkey,
India, Poland, Argentina, Spain, Nigeria, Tunisia, and Jordan.

Source: Same as table 21.


In the United Arab Republic, the possibly salutary effect of recent land tenure reforms
upon agricultural production may have been obscured by increasing pressure of population
on land. In Jordan, there appears to have been a discrepancy between the legal and eco-
nomic concepts of owners because of the reallotment of land every few years under that
country's Musha tenure system.

Iran, Argentina, Israel, and Pakistan have relatively high percentages of tenancy. In
Israel, rented land is mostly state owned.Itwas initially rented to immigrants and others
on leases of 5 years' duration, pending the granting of leases with heritable rights. Land
tenure reform in Iran has been officially recognized by Iranian leaders as one of the
major requirements for its entry into the ranks of rapidly developing nations.

Innumerable systems of land tenure are known to exist in Nigeria and Tanganyika.
Most commonly, however, land is held by a group of people, usually a tribe. It belongs
not only to the living members of the tribe, but to past and future generations. Hence,
neither the tribe nor individuals can permanently alienate it.

Rights to use land are established by investing labor in the land. The labor invest-
ment right applies especially to planted tree crops. Economic trees growing wild usually
belong to the community as a whole, and their fruit to anyone willing to harvest it.

Individuals have the right to use the landbut not to sell it or the appurtenances which
they have developed. Generally, these restrictions on alienation limit both mobility and
incentives to invest in land improvements.

Data comparing farms by tenure within countries are available for a few of the study
countries--mainly Iran, the Philippines, and India. In Iran in 1960, crop yields per
hectare were generally higher on land rented ona fixed rent basis and on owner-operated
units than on land rented for a share of the product (table 23).





Table 23.--Iran: Crop yield per hectare of harvested area, by types of tenure, 1960

On lands rented On lands rented
On lands
Crop from others for owned by from others
a share of holders based on fixed
produce rent
---------------------Kg--------------------------

Wheat total...................... 735 883 931
Irrigated
Winter ....................... 1,169 1,321 1,336
Spring....................... 713 1,017 1,029

Unirrigated
Winter....................... 521 612 813
Spring....................... 336 462 240

Barley total...................... 680 798 1,244
Irrigated
Winter ........................ 1,155 1,264 1,660
Spring....................... 802 974 1,943

Unirrigated
Winter....................... 687 729 1,156
Spring....................... 326 409 339

Rice.............................. 2,164 2,325 2,281

Legumes
Irrigated...................... 507 786 2,158
Unirrigated.................... 363 513 1,051

Cotton
Irrigated ...................... 1,007 1,302 1,744
Unirrigated.................... 1,002 1,095 920

Source: First National Census of Agriculture, Iran (Oct. 1960), National Summary Report,
Dept. of Public Statis.
In the Philippines, total farm receipts in 1954-55 per hectare were about 60 percent
more on tenant farms than on owner-operated farms (table 24). However, the value of
land per hectare is much larger on tenant farms than on owner-operated farms. This
suggests that tenant-operated land was generally more fertile (table 25). In value of out-
put per 100 pesos value of land, owner and part-owner farms compare favorably with
tenant farms. The main crop on tenant farms is paddy, which requires much labor. The
fact that tenants have a larger proportion of lowland paddy also indicates more double-
cropping on tenant farms. On the other hand, land in coconut plantations, pastures, and
meadows is more often worked by owners (table 26).

In India, farm management surveys in a few areas provide information on the inten-
sity of land use and output by tenure system. In one of these areas, the West Godavari
district of Andhra Predesh, the intensity of cropping is considerably higher on fully
owned holdings than on rented land (table 27). Also, output per acre of irrigated paddy on
fully owned holdings is much higher than on partially owned holdings (table 28). There
is not much difference between fully owned and fully rented holdings.

It is difficult to make reliable generalizations from the above observations because
of lack of information on differences between the tenure classes in other factors also
associated with output and yields. The more favorable showing of tenant farms in some of
the above comparisons probably reflects little more than the tendency for plantation
types of agriculture, where tenancy is high, to be concentrated on the most fertile lands.





Table 24.--Value of farm production by types of tenure, Philippines, 1954-551

Per farm household Per hectare of--

Item Owner Part- Tenant Owner Part- Tenant
farms owner farms farms owner farms


--------------------------Pesos-------------------------

Crops sold................... 374 356 206 129.0 118.7 85.8
Value of crops to landlord... -- 293 426 -- 97.7 177.5
Livestock and products sold.. 87 65 38 30.0 21.7 15.8
Value of crops and livestock
used at home............... 299 310 285 103.1 103.3 118.8
Value of shares for services. 95 146 178 32.8 48.7 74.2

Total.................... 855 1,170 1,133 294.8 390.0 472.1

1 Average hectares per farm were 2.9 for owners, 3.0 for part-owners, 2.4 for tenants,
and 2.6 for all tenure classes combined.
Source: Farm Management, Land Use and Tenancy in the Philippines. Central Expt. Sta.
Bul. No. 1, Univ. Philippines, Aug. 1957, p. 70.


Table 25.--Value of land per hectare and farm receipts per 100 pesos of land value,
Philippines, 1954-55


Tenure Value of land Farm receipts per
per hectare 100 pesos of land

----------------Pesos------------------

Owner-operated farm .............................. 1,633 56
Part-owner farm ................................. 2,235 57
Tenant farm ..................................... 2,767 58

Source: Same as table 24.


Table 26.--Percentage distribution of type of land, by tenure, Philippines, 1954-55

Land type All operators Owner Part-owner Tenant


-------------------------Percent----------------------

Lowland rice field............. 56 36 44 67
Upland rice field.............. 11 10 8 13
Coconut plantation............. 10 14 17 7
Orchard land................... 4 4 8 2
Other fields.................. 13 18 16 10
Woods, pastures, and wasteland. 4 14 4 1
Farmstead...................... 9 4 3 --

Total....................... 100 100 100 100

Number of farms in the sample.. 5,344 1,103 880 3,361

Source: Same as table 24.





Table 27.--Operated area, cropped area, and intensity of cropping, by type of
tenure, West Godavari District, India, 1957-58


Tenure Operated area Cropped area Intensity of
per holding per holding cropping

Paddy zone Acres Acres Ratio

Fully owned.......... 5.45 8.81 1.62
Partially owned...... 8.45 12.50 1.48
Fully rented......... 3.42 4.27 1.25

Source: "Studies in Economics of Farm Management in West Godavari District,
Andhra Predesh, Report for the Year 1947-58," Andhra Univ. Walfair (p. 77).


Table 28.--Value of output per acre (of cropped area)
according to type of tenure, West Godavari District,
India, 1957-58

Tenure Value of output

First-season crop Rupees

Fully owned holdings................. 331.80
Partially owned ....................... 280.03
Fully rented......................... 328.29

Second-season crop

Fully owned ......................... 286.02
Partially owned..................... 211.39
Fully rented.......................... NA

Source: Same as table 27.


Relation of Size of Holdings or Farms to Output and Progress
Minute subdivision of operating units is a major obstacle to increasing output in
several countries. Subdivision and fragmentation of holdings can prevail under any form
of land tenure, but are most frequent in certain overpopulated areas cultivated by peasant
owners where the rules of succession demand divisionof land. Islamic and Buddhist, and,
to some extent, Hindu laws, demand division of land between the heirs of the deceased
owner.
Relatively little is known about the effects of farm size on agricultural productivity,
and even less about the economies of farm size in the developing countries. However, data
are available for several countries which indicate how crop production per unit of culti-
vated area varied among farms of different sizes as measured in land area. In addition,
a few farm management studies have treated size of farm as a variable.

In densely populated areas where labor has little or no opportunity cost, returns per
acre above cash costs for purchased capital goods and services are an appropriate cri-
terion for measuring the relative efficiency of different sizes of farms.

Much available evidence indicates that small family farms have higher gross output
per acre than do large farms. For example, in a study of factors affecting the relative
success of cooperative and family farms in the Punjab of India, Dr. Harbans Singh Mann
found that production per acre generally was higher on small family-size farms than on
the large cooperative farms (table 29). In the few instances where yields were higher on









Table 29.--Value of output per acre on cooperative and family farms in 10 areas, Punjab,
India, 1953-54

Value of output on-- Value of output on--
Area Area
Family farms Cooperative farms Family farms Cooperative farms

Rupees Rupees Rupees Rupees

1 ....... 270 190 6....... 155 158
2....... 185 249 7....... 258 219
3 ....... 158 137 8....... 108 152
4....... 160 145 9....... 154 103
5....... 188 167 10....... 162 187

Source: Mann, Harbans Singh, Cooperative Farming and Family Farming in the Punjab: A
Comparative Study. Ph.D. Thesis, Ohio State Univ., 1962.


the cooperative farms, it was because the cooperative farms had obtained capital for con-
struction of superior irrigation facilities. Government credit and subsidies made available
to cooperative farms for purchasing tractors and constructing tube wells were important
incentives for establishing these farms. However, only three of the ten cooperative farms
continued for more than a few years. Landowners decided that production and income from
their land would be greater if they farmed it themselves or leased it to operators of small
family-size farm units.

Results of studies made by Farm Management Research Centers in India indicate
that gross output per acre averages higher on small farms than on large, privately
operated farms, as shown below (Long, 31).

Gross output per
Farm-size groups acre in rupees

Smallest 219
Second smallest 188
Second largest 170
Largest 159

Krishna, in an Indian study using three measures of farm size--output per unit of
input, output per unit of paid input, and output per hectare--concluded:

Under present conditions the ratio of output to total input shows no consistent
relation to the size of farm. In respect to the ratio of output to paid input the small
farm turns out to be more productive than the large farm, and in respect to output
per acre the small farms appear to be even more productive (32).

Data from the 1960 Census for Iran again indicate that crop yields average higher
on small farms than on large farms, although yields do not decline continuously as farms
become larger (table 30). However, much more labor is used per unit of cultivated area
on small farms than on large farms. Small farms apparently achieve relatively high
yields because of large labor inputs used to provide intensive irrigation facilities. The
data indicate that factor proportions differ greatly among farms. They suggest that
redistribution of labor on farms--so that land of the same quality is used equally--would
increase total farm output.

A study by Bevan of yields, labor inputs, and income of different sizes of rubber
holdings indicates very slightly larger yields per acre on small farms (5). But it is per-
haps most significant that it shows larger incomes on the larger farms which accrue
because of a more effective use of available labor. The number of trees topped per hour








Table 30.--Production per hectare of selected crops, and farm workers per hectare, by size
of farm, Iran

Wheat and barley Cotton Farm
Size of farm workers
(hectares) Not Not Rice er
Irrigated Irrigated per
irrigated irrigated hectare


------------------------ Kilograms ------------------------ Number

Under .5......... 782 2,215 904 1,792 2,609 5.45
.5 to 1.......... 607 1,720 847 1,360 2,108 2.14
1 to 2........... 553 1,399 855 1,014 2,309 1.22
2 to 3........... 442 1,259 791 1,113 2,274 .73
3 to 4........... 500 1,251 769 1,222 2,218 .50
4 to 5........... 517 1,202 799 902 2,092 .38
5 to 6........... 459 1,150 731 1,040 2,033 .24
5 to 10.......... 438 1,123 944 1,291 1,965 .13
20 to 50......... 432 1,134 976 1,098 1,564 .07
50 to 100........ 452 926 1,026 694 1,453 .04
100 to 500....... 945 997 2,063 1,846 2,580 .01
500 and over..... 684 1,217 1,485 647 2,432 --

All sizes...... 489 1,176 957 1,132 2,157 .34

Source: 1960 Census, Iran.

increases from 56 on the small to 108 on the large farms. This would appear consistent
with the assumption that considerable farm labor is underutilized in the less-developed
countries.
Farm-size conditions in Japan are of special interest because of the large increases
this country has achieved in agricultural productivity during the last 50 years. Numbers
of farms in different size categories as measured by land area have not changed much
since 1910. Most farms are as small as they have been for decades. In 1960, only about
2 percent of the farms were larger than 12.5 acres.

Crop yields in Japanare somewhathigher onthe larger than smaller farms (table 31).
But the multiple cropping ratio is larger for small farms, indicating that cropland is
used more intensely on smaller units. Total receipts per unit of cultivated area are slightly
smaller on farms with more than 2 cho (about 5 acres) than on smaller farms. This fact
again shows that land on small farms is used more intensively. Small farms use much
more labor per unit of cultivated area than do larger farms, but fertilizer inputs in-
crease with size of farm.

Japanese experts show that while rice yields are not at present higher on the larger
farms, the reverse was true during the 1930's (Ogura, 4Z). This apparently reflects the
increasing influence on yields of fertilizers, pesticides, and other purchased inputs which
are used in somewhat larger amounts on the larger farms. During the 1930's, the higher
rice yield on small farms was associated with larger labor and manure inputs.

Data on distribution of number and land area of farm holdings by size are shown in
tables 32 and 33 for the study countries arrayed by their 1948-63 rate of increase in crop
output. Other factors than size distribution of holdings bear so heavily upon agricultural
output that it is difficult to establish a definitive relationship between size distribution of
holdings and agricultural output.
It is interesting to observe that Japan, with relatively small farms, has a record of
long-sustained progress in increasing agricultural output, while Argentina has made very
little agricultural progress during the last two decades within a framework of relatively
large farms.










Table 31.--Crop yields, value of inputs, and total receipts per unit of cultivated area,
Japan

Size of farm (per cho)1

Item Less than .3 to .5 to 1.0 to 1.5 to 2.0 and

.3 .5 1.0 1.5 2.0 over


Crop yields ------------------------- Kilogram ------------------------

Paddy field rice........... 427 422 432 453 456 483
Upland rice................ 220 182 195 208 224 224
Barley...................... 319 300 306 332 327 340
Wheat..................... 256 254 263 273 272 268
Soybeans................... 121 126 125 128 128 132
Sweet potatoes............. 1,455 1,512 1,717 1,829 2,181 2,156
Potatoes................... 1,193 1,088 1,171 1,252 1,315 1,374

Inputs -------------------------1,000 yen---------------------------

Labor....................... 27.0 25.2 24.0 20.3 11.6 13.4
Fertilizer................. 2.7 2.8 2.9 3.1 3.1 2.9

Total receipts............. 38.8 38.5 40.6 40.9 38.9 36.6

------------------------ Number-------------------------------


Multiple cropping ratio2... 1.52 1.49 1.47 1.44 1.39 1.27

1 One cho is slightly more than one hectare.
2 Ratio of cultivated area to planted area.

Source: Farm Household Survey, 1960, Japan.

Table 32.--Percentage distribution of total number of holdings, by size groups of holdings, 21 countries, selected years
Hectares
Country Year Under 0.5 and andnd 2 and 3 and 4 and 5 and 10 and 20 and 50 and 100 and 200 and 500 and
S under under under under under under under under under under under an
5 1 2 3 4 5 10 20 50 100 200 500 above
...------------------------------------------Percent-------------------------------------------------
Israel............. 1950 .....14........ ..... ......55............. 16 10 3 -- -- 1 1
Mexico............. 1950 .....36........ ...... .... 37.............. 6 5 6 3 2 2 3
Costa Rica......... 1950 ..... 5 ...... ............33............. 16 14 20 7 3 2
Philippines........ 1948 .....19....... ............65............. 10 4 2
Tanganyika......... 1960 ......................................... .... 36................... ............... 64 .......
Yugoslavia......... 1951 .....12...... ................. 21 8 2 1
Taiwan............. 1949 26 20 26 13 ... 10..... 4 1 ....................... ................
Turkey............. 1952 .....18........ ..... .... 44............. 22 10 4 2
Venezuela.......... 1950 .................. ........... ... .. 30 ... 8 3 ....... 3..... 2
Thailand........... 1950 .....15....... ............55............... 21 9
Brazil.............1950 ....................20............. 12 17 23 11 6 5 4
Greece............. 1929 .....37....... ............49............ 10 3 1
Iran............... 1960 17 10 14 11 8 6... 18 12 4
India.............. 1954 .....39 ....... ............45............. 10 4 2
Poland............. 1960 10 ...23...... 12 .....18........ 26 10 1
Argentina.......... 1952 ...........................15... ........ 11 13 14 17 12 9 9
Japan.............. 1960 34 30 26 5 2 1 1 1 1
Spain.............. 1962 17 11 14 10 7 5 15 10 7 2 1 1
Colombia........... 1954 ... ........... ........ 37............ 16 11 9 4 2 2 1
UAR................ 1950 .....53........ .............39............. 5 2 1
Jordan............. 1953 ............ ........... 47............. 23 17 10 2 1 ..................
Source: Number and Size of Holdings: World Agricultural Structure, Study No. 1, FAO, Rome, 1961.









Table 33.--Percentage distribution of total area of holdings, by size groups of holdings, 19 countries, selected years


Hectares


Israel.........
Mexico..........
Costa Rica.....
Philippines....
Tanganyika .....
Yugoslavia .....
Turkey ........


Venezuela ......
Thailand .......
Brazil.........
Greece.........
Iran ..........
India .........
F4 Poland.........


Argentina ......
Japan .........
Columbia .......
UAR ............
Jordan ........


1950
1950
1950
1948
1960
1951
1952

1950
1950
1950
1929
1960
1954
1960

1952
1960
1954
1950
1953


--------------------------------------------- Percent ----------------------------------------....

..... .1...... .............. 9.............. 7 9 5 2 5 19 43
............................... 1.............. -- 1 2 2 3 6 85
............................... 2.............. 3 5 15 12 10 11 42
.....3......... ..............39.............. 18 15 11 3 3 8
......................................... .3............................................ .....97.........
.....1......... ..............23.............. 22 15 8 31............................
.. .. ... .... ..............17.............. 20 19 17 25............................


.......................1....................... .......

...................................................1
.....5......... ..............30.............. 5
1 11 3 4 4 5 21
... .5......... ..............35.............. 23
1 ...... 6....... ..........29........... 39

........................................................
9 21 34 12 5 3 7
............................... 3.............. 4
.....9......... ..............30.............. 10
............................... 11 .............. 14


........ 3 2 ......7....... 84

2 7 7 8 13 62
10 7 3 2 4 24
27 20 5 .......6....... 3
20 17 .................................
.......32.......


3 5 8

9 12 17
9 7 12
11 5 5


Source: Same as table 32. FAO, Rome, 1961.










CHAPTER 5. --TECHNOLOGY


Growth in man's capacity to produce foods and fibers (fig. 7) has been greatly
augmented through improvements in agricultural technology and increases in capital and
skills required to use them. Until the 19th century, most technological improvements
were either accidental discoveries or products of relatively few individuals. Since the
middle of the 19th century, however, a steadily growing stream of improved agricultural
technologies has developed.

This modern stream of technologies has resulted neither from any upturn in native
human intelligence nor from any mere natural acceleration in the growth of knowledge.
Rather, it has resulted mainly from newpolicies, public and private, which have allocated
resources and created new institutions expressly designed to increase knowledge of ways
to expand agricultural output and productivity. In the United States, public institutions
have included the U.S. Department of Agriculture, land-grant colleges, and agricultural
experiment stations. The effectiveness of these agencies has been enhanced by agricultural
extension and vocational agricultural education to disseminate knowledge of improved
techniques and to develop the problem-solving abilities of farm people. The contributions
of these agencies have been greatly supplemented, especially in recent decades, by the
scientific and engineering research efforts of private universities, foundations, and
business firms.

Modern technology has until very recently been largely concentrated in a few tem-
perate zone countries, principally the United States, WestEuropean countries, and Japan.
In these countries, it has made possible a level of farm technology that is much more
productive than the traditional technologies of underdeveloped countries. It also provides
greater scope for the economic use of much more capital and skills.


S WHEAT AND RICE YIELDS, 800-1959


0 I I
800 1,000
U. S. DEPARTMENT OF AGRICULTURE


1,200 1,400 1,600 1,800


2,000


NEG. ERS 3809-65 (7) ECONOMIC RESEARCH SERVICE
Figure 7
45





Differences in Current Technologies

Information available on the current level of agricultural technologies throughout
the underdeveloped countries is limited and as yet highly general. Yield differences of
major crops (table 34), although greatly influenced by soil and climatic conditions,
provide broad indications of the level of applied technology. Fertilizer consumption,
tractor numbers, use of insecticides, and use of improved crop varieties (tables 35-38)
serve as more direct measures of selected technologies and help to explain levels and
changes in crop yields.
Available data indicate that agricultural technologies of underdeveloped countries
are still highly rudimentary. Those countries that have made the most rapid technological

Table 34.--Average annual yield per hectare of wheat, maize, rice, and cotton, in 24
study countries, the United States, and the Netherlands, 1949-53 and 1961-63

Wheat Maize Rice Cotton
Country I
1949-53 1961-63 1949-53 1961-63 1949-53 1961-63 1949-53 191-63

Group I------------------------------100 kilograms-----------------------------

Israel........... 6.9 110.0 9.7 40.4 -- -- 9.5
Sudan............. 11.8 16.0 9.3 8.2 -- -- 3.6 3.6
Mexico............ 8.8 16.8 7.5 l9.4 18.0 22.5 3.3 5.7
Philippines...... -- -- 7.2 16.2 11.8 112.2 2.9 2.2

Tanganyika........ 5.8 NA 7.5 NA 12.3 NA 1.4 1.8
Yugoslavia....... 12.0 116.7 13.4 121.1 25.8 38.7 .9 2.1
Taiwan............ 9.6 19.7 14.1 17.5 22.1 132.1 3.4 2.1
Turkey............ 10.0 110.3 12.4 14.0 35.1 38.7 2.5 3.2

Venezuela........ 4.7 5.3 11.4 11.0 11.4 15.3 2.8 2.2
Thailand.......... -- -- 9.1 20.0 13.1 14.3 2.0 2.5
Brazil........... 7.4 6.9 12.4 '13.0 15.7 17.1 1.5 1.8
Greece........... 10.2 '15.3 9.3 14.1 31.3 39.3 3.0 4.2

Group II

Iran............. 9.0 8.6 10.3 NA 19.3 19.6 2.0 2.8
India............ 6.7 8.4 6.9 9.5 11.3 1 14.8 .9 1.2
Poland............ 12.5 18.7 NA 25.4 -- -- --
Argentina........ 11.5 12.6 14.8 17.7 30.5 33.6 2.4 2.3

Chile............. 11.9 '13.7 13.8 20.7 29.0 26.9 -- --
Japan............. 18.5 26.1 14.2 25.9 40.0 1 50.5 1.2 --
Spain............. 8.7 19.5 15.6 23.0 48.6 62.5 1.6 3.1
Colombia.......... 7.2 9.1 10.7 11.2 20.4 19.5 2.2 4.5

UAR............... 18.4 25.1 20.9 124.0 37.9 52.3 5.2 5.6
Pakistan.......... 8.7 18.1 9.8 10.0 13.8 1 15.9 2.0 2.4
Tunisia........... 4.9 3.4 3.1 NA -- -- -- --
Jordan............ 7.0 5.2 -- -- -- -- -- --

United States.... 11.2 16.9 24.9 37.8 25.6 39.5 3.2 5.0
Netherlands...... 36.5 43.8 32.5 38.4 -- -- --

1A major crop grown; area consisting of at least 10 percent of total area in field
crops.
Source: Production Yearbook, 1963, Vol. 17, FAO, Rome.






Table 35.--Consumption of commercial fertilizer nutrients per hectare of arable land, 26 study countries, United States, and
Netherlands, 1948-49 1952-53 and 1962-631

Fertilizer nutrients consumed per hectare of arable land Change in
total
1948-49 1952-53 1962-63 fertilizer
Country nutrients
per hectare
Nitrogen Phosphate Potash Total Nitrogen Phosphate Potash Total of arable
land


Group I --------------- --------------------------------------------Kilograms

Israel......... 1.5 1.9 0.3 3.7 49.5 29.7 6.0 85.2 81.5
Sudan .......... 0.7 -- -- 0.7 2.6 0.1 0.2 2.9 2.2
Mexico.......... 0.6 0.5 0.1 1.2 7.6 1.9 0.6 10.1 8.9
Costa Rica..... 6.2 15.8 -- 22.0 31.4 39.8 15.0 86.2 64.2
Philippines.... 4.0 2.5 0.2 6.7 4.3 2.2 2.9 9.4 2.7

Tanganyika..... NA NA NA NA 0.1 0.1 0.1 0.3 NA
Yugoslavia..... 0.8 1.2 0.4 2.4 16.1 13.4 9.4 38.9 36.5
Taiwan.......... 62.3 17.8 8.0 88.1 127.8 34.8 27.4 190.0 101.9
Turkey......... 0.3 0.2 0.1 0.6 1.3 1.3 0.1 2.7 2.1

Venezuela...... 0.5 0.2 0.3 1.0 1.1 2.0 1.5 4.6 3.6
Thailand....... 0.3 0.1 -- 0.4 1.2 0.6 0.3 2.1 1.7
Brazil ......... 0.6 1.5 0.6 2.7 3.9 3.9 3.6 11.4 8.7
Greece.......... 6.7 5.5 1.5 13.7 25.1 21.6 33.6 80.3 66.6

Group II

Iran........... NA NA NA NA 0.5 0.2 0.1 0.8 NA
India.......... 0.5 0.1 0.0 0.6 2.6 0.6 0.2 3.4 2.8
Poland......... 5.6 6.1 10.4 22.1 18.6 14.6 22.3 55.5 33.4
Argentina...... 0.2 0.2 0.1 0.5 0.3 0.1 0.1 0.5 0.0
Chile.......... 2.5 5.5 0.9 8.9 6.0 9.4 1.9 17.3 8.4
Japan.......... 72.2 44.1 28.5 144.8 110.2 76.6 83.3 270.1 125.3
Spain.......... 3.9 7.8 2.0 13.7 16.7 15.0 4.6 36.3 22.6
Colombia....... 1.0 2.2 1.9 5.1 4.8 1.0 5.5 11.3 6.2
Nigeria........ NA NA NA NA (2) (2) (2) 0.1 NA

UAR ............ 40.1 6.8 0.2 47.1 87.2 21.0 1.6 109.8 62.7
Pakistan....... 0.2 0.0 -- 0.2 4.1 1.1 0.5 5.7 5.5
Tunisia........ 0.3 2.2 0.2 2.7 0.4 1.9 0.4 2.7 0.0
Jordan ........ 0.5 0.1 -- 0.6 0.5 1.3 0.3 2.1 1.5

United States.. 6.1 10.1 6.4 22.6 11.2 14.7 11.7 37.6 15.0
Netherlands.... 44.1 34.9 45.6 124.6 293.4 101.3 123.8 518.5 393.9


1 Fertilizer nutrients in terms
2 Less than 0.05 kilograms.


of N, P205, and K20.


Sources: Fertilizers: An Annual Review of World Production, Consumption and Trade, 1963_and Production Yearbook, 1963, FAO,
Rome.

progress are generally those that have achieved the most rapid increases in crop yields.
As indicated in table 34, individual crop yields vary considerably among countries, with
the higher level of yields generally having been achieved in countries where fertilizer
applications are highest, where mechanization is most advanced, where insecticides and
pesticides are most commonly used, and where most progress has been achieved in the
development and use of improved crop varieties.

Agricultural techniques are most advanced in Japan, Israel, Argentina, Greece,
Yugoslavia, Poland, Spain, and Chile. Japan's superiorpositionhas been achieved through
technological transfers and through its own research and educational programs. Transfers
of technology from the United States and West European countries account for much of
the technological superiority in the rest of these countries. The recentness and rapidity
of the technological transformation in Israel are especially interesting. It has occurred
under uniquely favorable conditions with respect to capital, skills, motivations, and
institutions. Nevertheless, Israel's experiences suggest that technological transfer
potentials of long-run applicability to other countries, especially to those in the Middle
East, may be fairly large.





Table 36.--Tractors used in agriculture per 1,000 hectares, 24 study
countries, 1949-50 and 1961-62

Tractors per 1,000 hectares of arable land

Country 1961-62
1949-50 All Garden
tractors tractors


Group I --------------------Number---------------------

Israel.................. -- 19.24 .95
Sudan ................. .02
Mexico ................. -- 1.96
Costa Rica.............. -- 1.95
Philippines ............ .19 .60

Tanganyika............. .23 .16
Yugoslavia............. .86 4.55
Taiwan................. -- .56
Turkey................. .16 1.68
Venezuela .............. -- 4.11
Greece................. .78 6.11 2.16

Group II

Iran.................... -- .36 --
India.................. .05 .21 --
Poland................. .90 4.45 --
Argentina.............. -- 3.69 --
Chile.................. -- 2.72 --

Japan................. -- 1.55 232.82
Spain .................. .72 3.07 .13
Colombia ............... -- 4.66 --
Nigeria................ -- .02 --
UAR .................... -- 4.28

Pakistan............... -- .15 --
Tunisia................ 1.37 -- --
Jordan................. .09 .97 --

1 Number as reported for 1960.

Source: Production Yearbook, 1963, FAO, Rome.



Among the study countries, agricultural technologies are least advanced in the
tropical and semitropical countries. Taiwan, which lies astride the Tropic of Cancer,
is an exception, and therefore merits special study. In many underdeveloped countries,
sizeable commercial sectors produce such crops as cotton, rubber, tea, sugar cane,
cocoa, and bananas, mainly for export markets. Although quantitative information on
levels of applied technology in these sectors is not readily available, it is generally
well-known that in their uses of modern technological inputs, these sectors stand in
sharp contrast to the rest of the agriculture in their respective countries.











Table 37.--Use of specified pesticides, fungicides, and herbicides in agriculture, 12 study countries and the United States, 1960


Area and country'


Latin America
Argentina .............

Europe
Greece................
Poland.................
Spain.................

Near East & So. Asia
UAR................ ....
India..................
Israel.................
Pakistan ...............

Far East
Japan..................
Philippines..........
Taiwan..............
Thailand..............

United States............


DDT


Phoshos Spray oils Sulphur Copper Mrcur
opous Arsenicals and dinitro and and compounds Herbicides
compounds compounds compounds compounds


-------------------------------- Metric tons2 -----------------------------------------


394 131 436


177
44,827
17,259


469
1,104
175
508


10,622
3 231
3 39
S138

31,818


84
12,783
634


77
499
360
1,007


36,958
4 39
3 835
3 19

18,247


-567 1,294


396 13,027 8,039
590 1,206 640
6,148 22,541 8,567


1,799 88
328 8,830
2,060 130
36 452


7,695 15,872

-- 38
5 13


9,171
88


- 15,095


31
663
410



303
30
100


55,503
--
33
3 3


1,506


276
1,030
407



68
14,194
134


8 012
23


129 34,621


I Data not available for Brazil, Chile, Colombia, Costa Rica, Mexico, Venezuela, Nigeria, Sudan, Tanganyika, Tunisia, Yugoslavia
Iran, Jordan, Turkey, and the Philippines. 2 Each category shown is given the total quantity of material used without regard to
the concentration of active ingredients. 3 1959. 1958. 5 1958-59 average.

Source: Production Yearbook, 1962, FAO, Rome.


Table 38.--Relationship between seed status, proportion of crop area in improved varieties,
and crop yield changes for rice, wheat, and maize, selected countries, 1948-62

Proportion of Yields per hectare
Commodity and Seed crop area
country status' in improved
varieties 1948-52 1960-62 Change


Rice Bating Percent ---100 Kg/Ha---- Percent

Japan...................... 1 100 40.0 50.5 26
Taiwan...................... 1 95 19.1 25.4 33
Venezuela.................. 2 90 11.4 15.1 33
Chile...................... 3 65 29.0 27.0 -7
UAR ....................... 3 35 37.9 52.8 39
Pakistan .................. 4 5 13.8 15.9 15
Iran....................... 4 3 19.3 19.6 2

Wheat

Japan...................... 1 100 18.5 26.1 41
Netherlands................ 1 100 36.5 43.8 20
Mexico ..................... 1 85 8.8 16.7 90
Chile ...................... 2 80 11.9 13.7 15
Pakistan................... 2 7 8.7 8.1 -7
UAR ........................ 3 30 18.4 25.1 36
Colombia................... 3 20 7.2 9.1 26
Iran ...................... 3 10 9.0 2 7.8 -13
Jordan ..................... 4 15 7.0 5.4 -23

Maize

Venezuela.................. 2 20 11.4 11.0 -4
Pakistan .................. 2 8 9.8 10.0 2
Chile....................... 3 50 13.8 20.7 50
Colombia................... 3 20 10.7 11.2 5
UAR ....................... 3 7 20.9 24.1 15

1 Index of present efficiency in the chief factors influencing development production,
distribution, and use of better seeds, using rating of 1 to 4 with quality highest for
rating of 1.
2 1960-61.

Source: Statistics Division, FAO, Rome, and special FAO "Seed Status" inquiry.


I


I I








Present Technological Basis For Increasing Output

Appraisals of existing technological bases for increasing agricultural output in
underdeveloped countries differ widely. Much of this difference relates to the transfer-
ability of technological improvements of economically advanced nations. To the extent
that they are readily transferable to underdeveloped countries, such improvements
represent new, virtually free resources for increasing their agricultural output and
productivity. Hence, transfers merit careful investigation and more experimentation
than has yet been undertaken.


Local Techniques Now in Use on Best Farms

Widespread adoption of the more productive techniques already in use on the best
farms in underdeveloped countries is one important type of technological transfer. A
large part of the increases in agricultural output in Japan in the two or three decades
immediately following the Meji Restoration has been creditedto this approach (Ogura, 42).
This method of increasing efficiencyhas alsobeenused extensively in Western Europe and
the United States.

There has been little systematic research into the indigenous technological potentials
that underdeveloped countries now have. In.most underdeveloped countries, yields of
major crops grown on the same type of soil differ markedly from village to village and
even from farm to farm within the same village, year after year (Mosher, 38). These
observed differences suggest that now underutilized technological bases may be used to
increase agricultural output. Better technologies of an indigenous nature may not lead
to vast increases in output, but they may often facilitate further progress.


Technological Exchange Between Countries

Numerous technological transfers have been successfully made from more developed
into underdeveloped countries, especially into commercial sectors growing major
export crops. Generally, however, such transfers appear to be much more difficult to
make in agriculture than in nonagricultural enterprises. One likely reason is that non-
farm technological transfers are commonly made into whole, newly structured producing
units. Hence, it is easier to achieve good complements of the other factors and conditions
which interact with the improved nonfarm technologies to influence their productivity.
In contrast, attempts are frequently made to inject imported farm technologies into
already established farm plants, without close attention to conditions that have made the
improved technology work in the locality of its origin. Sometimes overlooked is the fact
that when the new technology is set in a different physical environment, it may contribute
little to output.

Success in international transfer of technology also requires attention to economic
and social as well as to physical relations. For oie thing, much improved technology
has been produced to maximize profits under particular land, labor, and capital supply
ratios, or under particular product-demand conditions and their associated price
relationships.

Secondly, the successful introduction of many new techniques requires concerted
action by many producers and sometimes community-wide, or even nationwide cooperation.
Economies of scale in procuring production requisites and marketing products preclude
use of some technologies, unless they are adopted somewhat simultaneously by a
relatively large number of producers. Eradicating crop and aiiimal pests and reducing
soil salinity are areas where a concerted and well-coordinated action over a large area
is usually required.

Finally, religious beliefs and practices, social class structures, and social, political,
and economic patterns often influence the ease of adoption of more advanced technologies,
whether imported or domestically developed.








Present Technological Basis For Increasing Output

Appraisals of existing technological bases for increasing agricultural output in
underdeveloped countries differ widely. Much of this difference relates to the transfer-
ability of technological improvements of economically advanced nations. To the extent
that they are readily transferable to underdeveloped countries, such improvements
represent new, virtually free resources for increasing their agricultural output and
productivity. Hence, transfers merit careful investigation and more experimentation
than has yet been undertaken.


Local Techniques Now in Use on Best Farms

Widespread adoption of the more productive techniques already in use on the best
farms in underdeveloped countries is one important type of technological transfer. A
large part of the increases in agricultural output in Japan in the two or three decades
immediately following the Meji Restoration has been creditedto this approach (Ogura, 42).
This method of increasing efficiencyhas alsobeenused extensively in Western Europe and
the United States.

There has been little systematic research into the indigenous technological potentials
that underdeveloped countries now have. In.most underdeveloped countries, yields of
major crops grown on the same type of soil differ markedly from village to village and
even from farm to farm within the same village, year after year (Mosher, 38). These
observed differences suggest that now underutilized technological bases may be used to
increase agricultural output. Better technologies of an indigenous nature may not lead
to vast increases in output, but they may often facilitate further progress.


Technological Exchange Between Countries

Numerous technological transfers have been successfully made from more developed
into underdeveloped countries, especially into commercial sectors growing major
export crops. Generally, however, such transfers appear to be much more difficult to
make in agriculture than in nonagricultural enterprises. One likely reason is that non-
farm technological transfers are commonly made into whole, newly structured producing
units. Hence, it is easier to achieve good complements of the other factors and conditions
which interact with the improved nonfarm technologies to influence their productivity.
In contrast, attempts are frequently made to inject imported farm technologies into
already established farm plants, without close attention to conditions that have made the
improved technology work in the locality of its origin. Sometimes overlooked is the fact
that when the new technology is set in a different physical environment, it may contribute
little to output.

Success in international transfer of technology also requires attention to economic
and social as well as to physical relations. For oie thing, much improved technology
has been produced to maximize profits under particular land, labor, and capital supply
ratios, or under particular product-demand conditions and their associated price
relationships.

Secondly, the successful introduction of many new techniques requires concerted
action by many producers and sometimes community-wide, or even nationwide cooperation.
Economies of scale in procuring production requisites and marketing products preclude
use of some technologies, unless they are adopted somewhat simultaneously by a
relatively large number of producers. Eradicating crop and aiiimal pests and reducing
soil salinity are areas where a concerted and well-coordinated action over a large area
is usually required.

Finally, religious beliefs and practices, social class structures, and social, political,
and economic patterns often influence the ease of adoption of more advanced technologies,
whether imported or domestically developed.








Present Technological Basis For Increasing Output

Appraisals of existing technological bases for increasing agricultural output in
underdeveloped countries differ widely. Much of this difference relates to the transfer-
ability of technological improvements of economically advanced nations. To the extent
that they are readily transferable to underdeveloped countries, such improvements
represent new, virtually free resources for increasing their agricultural output and
productivity. Hence, transfers merit careful investigation and more experimentation
than has yet been undertaken.


Local Techniques Now in Use on Best Farms

Widespread adoption of the more productive techniques already in use on the best
farms in underdeveloped countries is one important type of technological transfer. A
large part of the increases in agricultural output in Japan in the two or three decades
immediately following the Meji Restoration has been creditedto this approach (Ogura, 42).
This method of increasing efficiencyhas alsobeenused extensively in Western Europe and
the United States.

There has been little systematic research into the indigenous technological potentials
that underdeveloped countries now have. In.most underdeveloped countries, yields of
major crops grown on the same type of soil differ markedly from village to village and
even from farm to farm within the same village, year after year (Mosher, 38). These
observed differences suggest that now underutilized technological bases may be used to
increase agricultural output. Better technologies of an indigenous nature may not lead
to vast increases in output, but they may often facilitate further progress.


Technological Exchange Between Countries

Numerous technological transfers have been successfully made from more developed
into underdeveloped countries, especially into commercial sectors growing major
export crops. Generally, however, such transfers appear to be much more difficult to
make in agriculture than in nonagricultural enterprises. One likely reason is that non-
farm technological transfers are commonly made into whole, newly structured producing
units. Hence, it is easier to achieve good complements of the other factors and conditions
which interact with the improved nonfarm technologies to influence their productivity.
In contrast, attempts are frequently made to inject imported farm technologies into
already established farm plants, without close attention to conditions that have made the
improved technology work in the locality of its origin. Sometimes overlooked is the fact
that when the new technology is set in a different physical environment, it may contribute
little to output.

Success in international transfer of technology also requires attention to economic
and social as well as to physical relations. For oie thing, much improved technology
has been produced to maximize profits under particular land, labor, and capital supply
ratios, or under particular product-demand conditions and their associated price
relationships.

Secondly, the successful introduction of many new techniques requires concerted
action by many producers and sometimes community-wide, or even nationwide cooperation.
Economies of scale in procuring production requisites and marketing products preclude
use of some technologies, unless they are adopted somewhat simultaneously by a
relatively large number of producers. Eradicating crop and aiiimal pests and reducing
soil salinity are areas where a concerted and well-coordinated action over a large area
is usually required.

Finally, religious beliefs and practices, social class structures, and social, political,
and economic patterns often influence the ease of adoption of more advanced technologies,
whether imported or domestically developed.





The successful transfer of farm technologies between countries often requires that
extension and research efforts be closely coordinated. Extension personnel need to have
a keen appreciation of the functions of research and to be able to apply research findings
to the solution of farmers' problems. In turn, researchers must maintain a close
association with extension personnel in order to best direct their efforts toward solution
of problems that agriculturalists face. Close cooperation between physical and social
science specialists is also essential.

Available information on interrelationships between technologies and other factors
comprising the physical, economic, and social environment is now too limited to assess
definitively the potential of technological transfers. The experience basis now available,
however, indicates some transportable techniques that are fairly easy to adopt and that
yield good results with a minimum of change in other practices. One of the most important
of these involves the use of commercial fertilizers.


Fertilizers

Thousands of fertilizer experiments and demonstrations have been conducted during
recent years on major crops in the world's less-developed countries. These reveal highly
favorable results from using commercial fertilizers on major crops. For example, in
summarizing results from several thousand trials in cultivators' fields throughout India,
H. L. Richardson reported increases of paddy rice from 30 pounds of N (Nitrogen) and
30 pounds of P205 averaging 590 pounds per acre--an increase equal to 52 percent of
India's rice yield in 1959 (47).

Increases in yields of milled rice from 30 kilograms of nitrogen averaged 315 kilo-
grams in East Pakistan, 269 kilograms in Thailand, and 228 kilograms in Iran. High
rice yield responses were also reported for phosphate fertilizers, with 30 kilograms of
P205 yielding an increase of 214 kilograms of milled rice in East Pakistan, 246 in Iran,
and 265 in Thailand.

The results from applications of fertilizers to maize, wheat, and rice in several
countries are summarized in table 39. On the basis of these results, expansion in fertil-
izer consumption can add materially to increasing agricultural output.

Generally, there is a close relationship between uses of fertilizers and crop yields
(fig. 8). Other factors than fertilizers help to account for the fertilizer-yield associations
observed, but there is no country in the world where high crop yields can be maintained
long without continuing large inputs of commercial fertilizers. These requirements have
been increased with every improvement in varieties, pest controls, and other factors
increasing crop yields, and thereby the amount of crop materials annually taken from
the soil. Thus, fertilizers bear such a highly complementary relationship to other yield-
increasing practices that the amounts of fertilizers used per hectare of land can be
used as a fairly good index of progress in adoption of yield-increasing technologies
generally.

Expanding use of fertilizers is particularly important inthe early stages of transition
from traditional to modern agricultural production methods. Williams and Couston state
that

.....the response from fertilizer is usually strikingly visible--the difference in
growth, color of the plant, and size of the crop or fruit are evident to the eye of
even the untrained observer. Secondly, fertilizer is something tangible. The
farmer can seel it, handle it, and know when he has applied it. Another advantage
is that the farmer gets relatively quick returns from the use of fertilizer,
especially on annual crops. He can put the fertilizer on his crops and, in a
few short months, harvest and measure the increased production. Yet the
capital required is much less than for many other improvements that may be
desirable. While adequate credit for farmers to purchase plant food is a
problem in most areas of the world, such credit is required for only a short






Table 39.--Results of fertilizer trials and demonstrations on maize, wheat, and rice in selected countries

Yield Increase in Net return on
Kilograms of per hectare yield per hectare fertilizer used Cu-ut
fertilizer per kg.
Commodity country applied Control Ferti- Fer dollar of
per hectare Per value of --
(N,P20,K20) plot lized Amount Percentage hectare value of
areas areas ertilizer


Kg Kg Kg Pet. Dol. l. g.
Maize..... El Salvador 45-45-45 2305 3155 850 37 56 3.8 9.4
Ghana -Forest 22-0-0 1168 1465 297 25 11 2.2 13.5
-Savannah 22-22-22 1189 1713 524 44 13 1.6 7.9
Honduras -(Hybrid) 90-90-90 3892 7215 3323 85 176 4.1 12.3
-(Local) 45-45-45 2446 3192 746 30 24 1.8 5.5
Morocco -Casablance-Rabat 40-60-0 731 1162 431 59 1 1.0 4.3
-Marrakech-Safi 20-40-0 723 1139 416 58 6 1.5 6.9
-Tetouan 20-40-0 1397 1805 408 29 6 1.6 6.8
Nigeria -Forest 22-22-34 236 350 114 48 -17 .3 1.5
-Savannah 28-17-39 637 858 221 35 -13 .6 2.
Turkey -Black Sea 100-60-0 1421 2338 917 65 29 1.6 5.
-Marmara-Aegean 100-60-0 1870 2760 890 48 27 1.6 5.6

Wheat..... Lebanon -Akkar 40-35-20 21120 1900 780 70 44 2.8 8.2
Morocco -Casablanca-Rabat 20-37-47 1481 1867 386 26 9 1.4 3.
-Fes Meknes-Taza 20-37-47 1437 1682 245 17 -2 .8 2.4
-Tetouan 20-37-47 472 934 462 98 14 1.7 4.4
Syria -(Irrigated) 60-60-60 1914 2780 866 45 4 1.1 4.8
-(Nonirrigated) 0-40-0 725 977 252 35 4 1.3 6.3
Turkey -Central Anatolis 0-60-0 920 1350 430 47 21 2.3 7.2
-Threca 60-60-60 1260 2270 1010 80 57 2.7 5.6
Rice...... El Salvador 45-45-45 2239 3291 1052 47 91 -.6 7.7
(paddy) Ghana -Forest 22-22-22 1198 2101 903 75 64 3.7 13.4
-Savannah 45-45-45 1287 3134 1847 144 131 3.6 13.7
Nigeria -Forest 22-22-22 1829 2335 506 28 22 1.7 7.6
-Savannah 22-34-67 1417 1706 289 20 1 1.0 2.3
Senegal -Casamance 0-0-45 1266 1763 497 39 33 12.0 11.C
-Fleuve 0-0-45 2760 3156 396 14 28 10.C 8.8
-Sine Saloum 45-0-0 901 1326 425 47 25 3.5 9.4


1 Data by area, variety, and irrigated or nonirrigated included where available.

Source: Review of Trial and Demonstration Results, 1961-62, FFHC Fertilizer Program, FAO, Jan. 1964.

NOTE: Results shown include only that fertilizer application showing the largest additional return per he2tare of the zro. In
some instances, a different fertilizer application produced a larger increase in yield, a higher net return per dollar invested in
fertilizer, or a larger output per kilogram of fertilizer applied.


time and has a rapid turnover. Hence, teaching farmers how to use fertilizer
advantageously can be a strong motivational factor in encouraging many other
changes that are necessary to achieve efficient agricultural production (69).


In the 24 study countries for which data were available, fertilizer consumption in-
creased from 1.7 million metric tons of nutrients in 1949-50 to 5.4 million metric tons
in 1962-63. Fertilizer consumption per hectare of arable land, however, is still very low
in most countries. In 1962-63, for example, consumption of fertilizer nutrients per
hectare of arable land was less than 1 kilogram in Tanganyika, Nigeria, and Argentina,
and below 4 kilograms in Turkey, Jordan, Thailand, India, Sudan, and Tunisia (table 35).
Although fertilizer consumption in these 9 countries has increased several fold in the
11-year period considered, the increase in yields due to fertilizers is certain to have
been small. For example, assuming a physical response of 10 kilograms of food grains
per kilogram of fertilizers applied, total yield increase due to fertilizer would be less
than 30 kilograms per hectare in each of the above countries.


Based on the assumption of this 10 to 1 response ratio, the additional fertilizer con-
sumed in India, Thailand, and Pakistan would account for only about 20 percent of the
increases in grain yields. In Turkey, Mexico, Venezuela, Yugoslavia, and Greece, between
one-fifth and one-half of the increase in grain yields would be explained by increases in
fertilizer use. Increased fertilizer use would account for two-thirds or more of the
increases in Chile, Egypt, Brazil, Taiwan, Israel, Spain, and Japan.









Yield Value
Index

500


CURVE OF AVERAGE RELATIONSHIP BETWEEN FERTILIZER USE AND VALUE INDEX OF CROP PRODUCTION
(per arable hectare 41 countries, 1956-58)


Indonesia
Philippines
Canada
Colombia
Mexico
Brazil
Chile


FERTILIZER USE
South Africa 22. Australia
Yugoslavia 23. Italy
Spain 24. Peru
Greece 25. Egypt
U.S.A. 26. Finland
Portugal 27. Israel
Ceylon 28. Sweden


29. France
30. Austria
31 South Korea
32. Denmark
33. United Kingdom
34. Norway
35. Taiwan


Switzerland
West Germany
Japan
Belgium Luxembourg
Netherlands
New Zealand


Source: Williams and Couston (69).


Burma
Argentina
Thailand
Pakistan
Turkey
India
Syria


Figure 8








The accuracy of these estimates depends onthe validity of the assumed 10:1 response
ratio and on the further assumption that fertilizer applications on grain crops increased
at the same rate as on all crops. Although in some countries much of the increased
fertilizers consumed may have been applied to vegetable and other specialty crops, there
is little question that increased use of fertilizers has largely accounted for increased
crop yields in recent years. In Japan and Taiwan, where fertilizer consumption per
hectare is now quite high, average physical response is probably below a 10 to 1 ratio.

As consumption of fertilizer has increased, other technical improvements apparently
have been made on such a scale that fertilizer consumption can be used as a good index
of the level of technology. Williams and Couston, for example, report an 0.87 coefficient
of correlation between fertilizer consumption and grain yields in 40 countries (69).

Fertilizer supplies and cost-price relationships.--In many countries, lack of im-
proved seeds, fertilizers, pesticides, and many other factors when needed has seriously
impeded adoption of improved farming techniques. Farmers in all study countries where
the AID now has an operating mission were questioned on the availability of such pro-
duction requisites. In most of the countries, lack of availability appeared to be a serious
deterrent to their increased use (table 7, Chapter 1).

Where production requisites are available, however, their high supply prices relative
to farm product prices further discourage their use in some of the study countries.
This is especially true for fertilizer, the one factor on which price data are available for
several of the study countries (table 40). Using fertilizer and farm product prices and
price relationships shown in tables 40 and 41, for example, in India it would be necessary
to obtain an increase in yield of rice paddy of 5.23 kilograms to pay for 1 kilogram of
fertilizer; but in Japan a yield increase of only 1.35 kilograms would be needed to pay
for 1 kilogram of fertilizer (table 42).

Subsidies have been used in some of the study countries in order to introduce and
expand the use of various fertilizers. The low prices paid for fertilizers by the farmers
of Pakistan, for example, result mainly from high government subsidies. In Taiwan,
while current fertilizer prices are high, free distribution of at least limited amounts of
fertilizers in the past helped to stimulate the early adoption of fertilizers. In Japan, the
relationship of high commodity prices and low prices for fertilizers, both having been
influenced by government price and trade policies and by level of general economic devel-
opment, has helped make high levels of fertilizer use profitable.

Because of the large uncertainty attending the use of fertilizers or other improved
techniques when they are first introduced, subsidies can stimulate initiation of their use.
Unless high profits have been demonstrated, farmers living near subsistence levels are
often slow to adopt new technologies because of risk and uncertainty elements.

The potentials for increasing output through the use of fertilizers will grow as im-
provements are made in the complement ofotherpractices and conditions which influence
yields and profits. For example, new high-yielding, short- and stiff-strawed wheat and
rice varieties adaptable to a wide range of environmental conditions are capable of
utilizing 80 pounds or more of nitrogen fertilizer per acre, whereas traditional varieties
can utilize very little additional nitrogen because of lodging.

The economic feasibility of fertilizer use will also be increased as sources of supply
are improved, as economies are achieved in procurement and distribution of fertilizers,
and, overall, as agriculture becomes more commercial. From the standpoint of fertilizer
supplies, construction of large new fertilizer plants in many less-developed countries is
encouraging (table 43).

Major industrial firms with broad bases of experience are becoming active not only
in production but in promotion, sales, and distribution. With improvements intransport
facilities, removal of internal trade barriers, and improvements in production technol-
ogies, the cost of putting fertilizer nutrients into agricultural uses in less-developed
countries can be substantially reduced.








Table 40.--Fertilizer prices paid by farmers in selected countries, 1962-631


Fertilizer Price of fertilizer per kilogram
Country used per
hectare N P20s K20 Average2



Kg. -------------U.S. cents---------------
Latin America
Chile................ 17.3 27.9 12.2 11.6 17.6
Costa Rica........... 86.2 34.4 15.9 13.9 22.3

Europe
Greece............... 80.3 20.9 15.8 11.8 15.7
Spain ................ 36.3 26.8 20.0 6.5 21.4

Near East and So. Asia
UAR .................. 109.8 38.9 21.9 17.0 35.3
India3 ............... 3.4 36.8 31.9 13.0 34.5
Israel............... 85.2 22.3 15.9 6.6 19.0
Pakistan............. 5.7 14.0 11.0 4.9 12.6

Far East
Japan................ 270.1 27.8 23.6 9.7 21.0
Philippines4......... 9.4 32.2 25.6 12.0 24.4
Taiwan............... 190.0 44.0 23.6 12.5 35.7
Thailand............. 2.1 24.0 25.0 13.5 22.8

United States.......... 37.6 26.7 19.7 9.8 18.7

1 Prices are for major materials used net of subsidy except where noted.
2 N, P205, and K20 in ratios used per hectare of arable land as shown in
table 35.
3 Subsidies at rate of 25 percent are given in some parts of country.
4 Market price without deduction of subsidies.


Largely as a result of improvements in fertilizer production technologies, the cost
of fertilizers has increased very little in most of the study countries since the middle
1950's. A major technological change in production has been the development of larger,
more efficient plants, particularly for manufacture of ammonia of higher analysis
fertilizer materials. The latter have helped to reducetransport and handling costs, which
are substantial cost items in most of the less-developed countries.

Improved Crop Varieties

It is estimated that application of genetic principles to plant breeding and distribution
of improved seed and plant materials to farmers have recently accounted for one-fourth
to one-third of the increases in crop production in West European countries (Fischnich,
14). Improved crop varieties have contributed to remarkably high yield increases of
major crops in Japan, Taiwan, and Mexico as well. Further indication of the effects of
variety improvements on yields is shown in tables 38 and 44.
Rice yields in Japan, with a seed status rating of excellent or 1, for example, in-
creased from 4,000 kilograms per hectare during 1948-52 to 5,000 in 1960-62. Yields in
Iran, with a rating of poor or 4, increased only 2 percent. The relationships between seed
status and yield increases, however, are not highly consistent, reflecting differences
between countries in other factors influencing yield increases and differences in inter-
pretation of the survey questions on which these ratings are based.








Table 41.--Prices of wheat and rice (paddy), and ratio of fertilizer prices
to commodity prices, selected countries, 1960-611


Ratio of fertilizer
Commodity prices to commodity prices
Commodity and country price per
kilogram
kilogram N P K20 Average2


Wheat ------------------ U.S. cents ----------------------
UAR .................. 5.8 6.71 3.77 2.93 6.09
India................ 9.4 3.91 3.39 1.38 3.67
Japan ................ 11.6 2.40 2.03 0.84 1.81
Pakistan............. 8.4 1.67 1.31 0.58 1.50
Spain................ 9.3 2.88 2.15 0.70 2.30

United States........ 8.3 3.22 2.37 1.18 2.25

Rice (paddy)3

UAR .................. 4.6 8.46 4.76 3.70 7.67
India ................ 6.6 5.58 4.83 1.97 5.23
Japan ................ 15.6 1.78 1.51 0.62 1.35
Pakistan............. 11.0 1.27 1.00 0.45 1.15
Philippines.......... 7.8 4.13 3.28 1.54 3.13
Thailand............. 5.5 4.36 4.55 2.45 4.14

United States........ 10.9 2.45 1.81 0.90 1.72



1 Represents kilograms of increased production required to equal cost of a
kilogram of fertilizer.
2 N, P205, K20 in ratios used per hectare of arable land as shown in table
35.
3 Milled rice prices converted to paddy, using coefficient of 0.66.

Source: FAO Production Yearbook, 1963.


The present status of country programs designed to improve seed quality is shown
for wheat, rice, and cotton in table 45. Most of the study countries for which information
is available rank relatively low in their efforts thus far to improve the seed quality.
Mexico, Poland, and Yugoslavia are notable exceptions. It is also known that both Japan
and Taiwan have developed good seed research, control, and distribution programs.

More important than the variety improvements already made in the agriculture of
individual countries is the progress made in a few major research centers in developing
basic genetic inputs for major crops, and for cereals in particular. High sensitivity of
cereal varieties to sunlight has been a major hindrance to successful transfer of im-
proved varieties from one region to another. Awell-known example of such difficulty was
experienced in the 1940's when corn hybrids were transferred from the North Central
States into the southern United States. Within recent years,however, geneticists have
developed improved varieties of wheat so insensitive to changes in length of day that
they can be successfully transferred into any part of the world lying between the latitudes
of 0 and 50 degrees, as long as there are adequate moisture and soil fertility.





Table 42.--Increases in yield of wheat and rice needed to cover cost of 50 additional
kilograms of fertilizers, at 1962-63 prices, selected countries


Fertilizer Increase above 1961-63 Fertilizer
Commodity Yields nutrients yields required to pay to yield
commodity per used per for 50 additional response
c y hectare, hectare kilograms of ferti- ratio
country 1961-631 of arable lizer nutrients2 required to
land2 cover ferti-
Amount Percent lizer costs


Wheat 100 kg. Kg. 100 kg.

UAR............... 25.1 109.8 3.0 12.0 6.09
India............ 8.4 3.4 1.8 21.4 3.67
Japan............ 26.1 270.1 0.9 3.4 1.81
Pakistan......... 8.1 5.7 0.8 9.9 1.50
Spain............ 9.5 36.3 1.2 12.6 2.30

United States.... 16.9 37.6 1.1 6.5 2.25

Rice (paddy)

UAR............... 52.3 109.8 3.8 7.3 7.67
India............ 14.8 3.4 2.6 17.6 5.23
Japan............. 50.5 270.1 0.7 1.4 1.35
Pakistan......... 15.9 5.7 0.6 3.8 1.15
Philippines...... 12.2 9.4 1.6 13.1 3.13
Taiwan........... 32.1 190.0 2.0 6.2 3.97
Thailand......... 14.3 2.1 2.1 14.7 4.14

United States.... 39.5 37.6 0.9 2.3 1.72


1 As shown in table 34.
2 N, P205, and K20 in ratios


shown in table 35.


In regard to cereals generally, Dr. Albert H. Moseman, Director for the Agricultural
Sciences, The Rockefeller Foundation, states:

Improved crop varieties of most of the principal food grains can be made avail-
able for almost any part of the world within a period of six years' time if proper
attention is given to the necessary adaptive research.5

Dr. Moseman states that the short-strawed variety of wheat, Norin 10, which was
introduced from Japan after World War II, has been used in breeding the Gaines variety.
The Gaines variety, which produced approximately 190 bushels per acre in the Pacific
Northwest in 1964,

.....is a parent of the several semi-dwarf varieties developed in the Rockefeller
Foundation's cooperating program in Mexico. These wheats have yielded up to
120 bushels per acre in the Yaqui Valley of Mexico and now occupy more than
85 percent of Mexico's wheat acreage. The Mexican wheats have proved to be
exceptionally productive also in India. They are not photosensitive and so will
mature a certain number of days after they are planted, regardless of the length

5 Moseman, Albert H., "Food, People and Private Enterprise." A paper presented at the American Seed Trade Association,
19th Hybrid Corn Industry-Research Conference, Chicago, 11. December 9-10, 1964.





Table 43.--Capacity of new fertilizer projects under construction or in
planning stage, 18 study countries

Country Nitrogenous Phosphate
fertilizers fertilizers


----------------Mtetric tons-----------------
Latin America
Argentina ............ 189,000
Brazil............... 83,500 16,500
Mexico............... 40,000 17,000

Africa
Sudan ................ 40,000
Tunisia .............. 52,000 100,000

Europe
Greece............... 164,000 100,000
Poland............... 896,000 160,000
Spain................. 415,300 45,000
Yugoslavia........... 67,000

Near East & So. Asia
UAR .................. 43,000 19,000
India................ 1,201,000 346,500
Israel............... 50,000
Pakistan............. 231,000
Turkey ............... 66,000

Far East
Japan................ 1,140,100 9,000
Philippines.......... 82,000 69,000
Taiwan............... 110,000 10,000

Source: World Fertilizer Atlas, 1964, The British Sulphur Corporation,
Ltd., 40 Great Titchfield Street, London W. 1.


of day. The early maturity of these varieties and the rather definite time span
from planting to harvest permits the production of two, or possibly three, crops
during a twelve-month period. This trait also permits the acceleration of breed-
ing programs to incorporate disease resistance, grain quality, and other charac-
teristics that may be required in the successful adaptation of the higher yielding
wheats to different environments.

Some varieties of rice that have been tested at the International Rice Re-
search Institute at Los Banos, in the Philippines, also have been found to be
nonphotosensitive and adapted to a wide range of environments in the tropics.
These short- and stiff-strawed wheat and rice varieties are capable of utilizing
80 pounds or more of nitrogen fertilizer per acre and should permit the pro-
duction of yields that are anywhere from double to fourfold the production of
local varieties in many parts of the world.6

Mechanical Improvements

Improvements in farm machines and implements have contributed to increasing
agricultural output and productivity in the now economically advanced nations. Many
modern implements, however, represent relatively large capital investments, and are used
6See footnote 5.






Table 44.--Yield changes of selected crops resulting from use of new and improved
varieties, selected countries, 1948-62

Proportion of
Seed crop area in Yields per hectare
Seed crop area in
status' new or improved
Country Crop varieties 1948-52 1960-62 Change

Rating Percent 100 kg. 100 kg. Percent


Mainly new varieties

Taiwan ......... Pineapple2 1 100 97.3 174.7 80
Sugarcane3 1 100 64.4 4 97.5 51
Israel......... Sorghum5 1 95 6.6 21.1 220
Venezuela...... Sugarcane 2 95 100.0 486.0 386

Mainly unimproved varieties
Colombia........ Maize 3 20 10.7 11.2 5
Pakistan....... Jute 4 5 14.2 15.0 6
Chick peas 3 25 6.1 5.4 -12
Venezuela...... Coffee 2 10 1.5 1.7 13
Maize 2 20 11.4 11.0 -4

1 An index measuring existing efficiency in the chief factors influencing production,
distribution, and use of better seeds, using rating of 1 to 4 with quality highest for
rating of 1.
2 64 percent of pineapple area was in Smooth Cayenne in 1950, compared with 100 percent
in 1959.
3 Introduction of N:Co 310 strain was made in 1951-52; 91 percent of the crop was in
this variety by 1956-57.
4 White sugar.
5 Native strains have been almost completely replaced by crossbreed Hazera 610 in most
areas on unirrigated land.

Source: Statistics Division, FAO, Rome.


mostly to save labor. In most underdeveloped countries, the scarcity of capital relative
to labor severely limits the economic value of mechanical innovations requiring large
capital. Extensive use of such implements, therefore, may be advisable only when they
make possible large improvements in quality of the operations performed, or enable
performance of production operations that cannot be easily performed with traditional
implements.

In countries that have large land expansion potentials, introduction of more tractors and
tractor-drawn machinery could facilitate exploitation of land. Even in these countries,
however, the scarcity of capital dictates careful weighing of this approach against tech-
niques requiring little capital.

Much progress has been made in recent years in adapting modern farm machinery
to the needs of small-scale agriculture. Small garden tractors have been extensively
used in Switzerland, France, and West Germany since the late 1940's. Nowhere has their
use increased at a faster rate than in Japan, where slightly over 1.4 million were in use
in 1961. Since then the number has rapidly increased.

While numbers of tractors and tractor-drawn equipment serve as measures of
progress in farm mechanization, surveys indicate that use of even the simple, traditional
tools of some regions in other areas may constitute a substantial technological







Table 45.--Seed status of wheat, rice, and cotton, in specified countries, 19641

Cmodity and Plant Use of Production Seed Seed Seed Seed Areas Area under
comounty rditg improved of improved SeedeSeed Seed
country breeding impoeed ofimp ed certification testing distribution laws under improved
varieties seed crop varieties

(1) (2) (3) (4) (5) (6) (7) (8) (9)

Wheat Rating Rating Rating Rating Rating Rating Rating 1,000 ha. Percent
Argentina...... 2 2 1 1 1 1 1 3,599 100
Mexico.......... 1 1 2 3 3 2 2 840 98
Poland......... 1 1 1 1 1 1 1 1,640 90
Yugoslavia..... 1 1 1 1 1 1 1 2,150 50
UAR............ 2 2 3 3 3 3 5 600 30
Jordan......... 3 3 4 5 4 4 5 225 15
Tunisia........ 1 1 1 1 1 1 1 1,200 100
Turkey......... 2 2 2 2 2 4 2 7,800 35
Pakistan....... 2 2 2 2 2 2 5 4,700 7
Iran........... 3 3 3 4 4 3 4 4,000 10
India.......... 2 2 3 5 4 2 5 13,300 44

Netherlands.... 1 1 1 1 1 1 1 126 100
Rice

Argentina...... 2 2 2 1 1 1 1 46 90
Costa Rica..... 1 1 1 3 3 2 3 59 33
Venezuela...... 2 2 4 2 2 2 2 74 90
UAR............ 3 3 3 3 3 3 5 250 35
Pakistan....... 4 3 4 4 4 4 5 9,700 5
Iran........... 2 4 4 4 5 4 4 340 1
India.......... 2 2 3 5 4 2 5 35,470 37
Cotton
Costa Rica..... 2 3 3 3 3 3 3 1 75
Venezuela...... 2 2 3 2 2 2 2 48 90
Yugoslavia..... 3 3 1 1 1 1 1 10 100
UAR............ 1 1 2 3 3 2 4 830 80
Pakistan ....... 2 2 2 2 2 2 3 1,400 75
Iran........... 3 3 3 4 4 3 4 300 20

United States.. 1 1 1 1 2 1 2 600 90

1 The ratings 1, 2, 3, 4, and 5 designate excellent, good, fair, poor, and none, respectively. The following criteria were con-
sidered by plant scientists when they replied to each of 9 questions asked in the survey:
1. Plant breeding: an appraisal of local breeding facilities for the crop concerned, including experimental stations and insti-
tutes, professional staff, and the quality of the work done by the professional staff.
2. Improved varieties: availability of improved varieties, locally bred or imported, ready for commercial use.
3. Seed Production: facilities available to provide commercial quantities of improved seeds. This includes state farms, private
farms, cooperatives for seed multiplication, and facilities for processing and storing seed.
4. Seed Certification: an appraisal of existing official organizations specially concerned with supervising seed production by
certification schemes.
5. Seed Testing: existing control of seed quality during production process, including an appraisal of seed testing laboratories.
6. Seed Distribution: organization of the method of seed distribution from the breeding station to the farmer.
7. Seed Laws or Regulations: an assessment of the effectiveness of existing laws or regulations relating to seed; (if no laws were
in existence, a status rating of zero was given.)
8. Area under crop: latest estimate (in thousand hectares).
9. Area under improved varieties: latest estimate (in percentage of total crop).
Source: Special survey made for ERS, USDA, by FAO, Rome, 1964.

improvement (Mosher, 38). In manyofthe less-developed countries, shifts from wooden to
steel-pointed plows, from steel to rubber-tired wheels, or from sickles to scythes may
be major mechanical improvements. Also, change from broadcasting to row planting of
crops--including in some cases maize and cotton--has yielded favorable results in
several areas. In studies of the economic advantages of drill sowing over broadcasting
conducted in India, drill sowing of ragi yielded 19.67 percent more per unit of land than
did broadcast planting (Patil, 45). This drilling of seed was done with a "country seed
drill," a simple device to help drop the needed quantity of seed in regular lines.

In some instances, farmers' adoption of specific techniques may be retarded if large
amounts of labor are required. Even though the country's general labor supply may be
plentiful, the added labor represents a cost to the individual farmer, either as a cash
expense or as a loss of leisure. If additional labor slows down adoption of production-
increasing technologies, then a more rapid movement toward mechanization of a labor-
saving type may be indicated.







Research for Improving Technological Bases


Improving the technological bases of agriculture in underdeveloped countries is
fundamentally a research task. Much of the research required needs to be carried on
within the underdeveloped countries, but facilities there are the most inadequate. For
example, in 1960 the number of research workers per 100,000 people active in agri-
culture was only 1.2 for India, 4.5 for Pakistan, and 4.7 for Thailand, compared with
60 for Japan, 79 for Taiwan, and 133 for the Netherlands (table 46).
These figures are only indicative of existing research limitations. Generally, the
less-developed countries have more disadvantages than these data indicate. Research
personnel generally have had less training than their counterparts in more advanced
nations, and they often work with less adequate facilities and support personnel. More-
over, research takes time for useful results, and in several of the countries research
programs have been in operation for only a few years.
In developing research programs, the underdeveloped countries can make use of the
large body of fundamental scientific principles and methodological know-how built up in
the economically advanced countries over the years. Thus, while rice varieties that have
enabled Japan to increase its rice production may not be successfully transferred into
India or the Philippines, the basic scientific principles used by Japanese scientists can
help develop improved varieties in other countries.
The transferability of such know-how has made it possible for geneticists in Mexico
to develop new varieties of wheat that helped to double that country's yield per acre be-
tween 1948-52 and 1960-62 (table 38). According to experts in Israel, research has
enabled Israeli farmers to increase their yield of cereals from 600 to over 5,000 kilo-
grams per hectare on unirrigated land, and from 3,000 to over 10,000 kilograms per
hectare on irrigated land.
The future capacity of the agricultural sectors of underdeveloped countries to increase
output will be facilitated by development of improved agricultural research programs.
For many problems, optimal use of scarce research resources necessitates the develop-
ment of regional centers to serve several countries, in the manner being done by the
International Rice Research Institute in the Philippines. While basic research requires
continuing attention, considerable efforts need to be concentrated on applied research
within individual countries (Sukhatme, 6j).
Table 46.--Agricultural research workers per 100,000 people active in agriculture,
14 countries, 1960

Agricultural Agricultural
Country research Country research
workers workers

Number Number

India...................... 1.2 Iran..................... 10
Philippines................ 1.6 Greece.................. 10
Mexico...................... 3.8 Argentina............... 14
Pakistan................. 4.5 Yugoslavia.............. 29
Thailand................... 4.7
Japan................... 60
Colombia................... 9 Taiwan .................. 79
Spain ...................... 10 Netherlands ............. 133

Sources: Directory of Agricultural Research Institutes and Experiment Stations in Asia
and the Far East, FAO, Bangkok, 1962, and FAO questionnaires to perspective governmental
Inventory of Information Basic to the Planning of Agricultural Development in Latin
America, CIDA, Pan American Union, Washington, D.C.

7 These estimates were provided by FAO.











CHAPTER 6.--THE HUMAN FACTOR

This section deals with human resource characteristics as factors associated with
differences in levels and rates of change in agricultural output and productivity in the
study countries. Its emphasis is on population and population characteristics as a source
of supply of labor and entrepreneurship. Population is also important as a source of
demand for goods and services, but this aspect will be treated in Chapter 8.
Together, the 26 study countries account for more than 1 billion of the world's 3
billion people and for about 75 percent of the population in countries assisted by the AID.
India alone has almost a sixth of the world's people. Pakistan, Japan, and Brazil rank
among the 8 leading countries of the world in population size (table 47). With the excep-
tion of Japan, most of the population in these countries is rural (table 48).

Table 47.--Population size, density, and growth rates in the 26 study countries,
by size of population, specified years


Total Population Population
Country population, piometer growth rate,
1960 1950-60
of area, 1961

Millions Number Percent

India.................. 429.0 138 2.0
Pakistan ............... 92.6 100 2.2
Japan .................. 93.2 254 1.2
Brazil................. 71.0 9 3.1
Nigeria................ 35.1 39 3.7

NMexico................. 35.0 18 3.1
Spain .................. 30.3 61 0.8
Poland................. 29.7 96 1.8
Turkey ................. 27.8 37 2.9
Philippines............ 27.4 96 3.2

Thailand............... 26.4 53 3.2
UAR .................. 26.0 27 2.4
Iran................... 20.2 13 2.2
Argentina.............. 20.0 8 1.7
Yugoslavia............. 18.4 73 1.1

Colombia ............... 14.1 13 2.2
Sudan .................. 11.8 5 3.4
Taiwan................. 10.6 305 3.4
Tanganyika............. 9.2 10 1.8
Greece................. 8.3 64 1.0

Venezuela .............. 7.4 8 4.0
Chile.................. 7.7 11 2.5
Tunisia................. 4.2 34 1.8
Israel................. 2.1 106 5.2
Jordan................. 1.7 17 2.6
Costa Rica............. 1.2 24 3.9

Source: Demographic Yearbooks, United Nations.
62






Table 48.--Rural population,


26 study countries arrayed by size of total population,
1950 and 1960


Rural population

Total 1960 1950
Country population, 1960 as a
1960 Percentage Percentage percentage
Size of total Size of total of 1950
population population

Millions Millions Percent Millions Percent Percent

India.......... 429.0 353.6 81.9 293.2 82.8 121
Pakistan....... 92.6 84.2 87.2 69.8 89.9 121
Japan........... 93.2 34.0 36.9 51.8 62.5 66
Brazil......... 71.0 39.0 54.9 33.4 63.8 117
Nigeria......... 35.1 NA NA NA NA NA

Mexico.......... 35.0 17.2 49.1 14.8 57.4 116
Spain........... 30.3 22.2 73.0 17.7 63.0 125
Poland.......... 29.7 15.4 51.9 20.8 83.9 74
Turkey.......... 27.8 19.0 68.3 16.4 78.1 116
Philippines.... 27.4 NA NA 14.9 73.1 NA

Thailand....... 26.4 23.2 88.2 17.3 90.5 134
UAR............. 26.0 16.2 62.5 13.9 68.0 117
Iran........... 20.2 NA NA 13.0 80.0 NA
Argentina...... 20.0 NA NA NA NA NA
Yugoslavia..... 18.4 NA NA 13.2 82.9 NA

Colombia....... 14.1 NA NA 7.2 63.7 NA
Sudan........... 11.8 NA NA NA NA NA
Taiwan......... 10.6 NA NA 3.5 46.2 NA
Tanganyika..... 9.2 NA NA NA NA NA
Greece.......... 8.3 4.8 57.8 4.8 63.9 100

Venezuela...... 7.4 2.4 32.4 NA NA NA
Chile........... 7.7 2.4 32.9 2.2 38.3 109
Tunisia........ 4.2 NA NA NA NA NA
Israel......... 2.1 0.3 14.3 0.2 17.7 150
Jordan.......... 1.7 0.9 56.2 0.8 64.4 112
Costa Rica..... 1.2 0.8 66.7 0.6 66.5 133

Source: Demographic Yearbooks (1963 and earlier years), United Nations.


Population Size and Agricultural Output

The importance of a cQuntry's population as a source of supply of labor and entre-
preneurship depends both (a) upon its size relative to the supply of other complementary
resources, and (b) upon qualitative characteristics of the populationwhich influence labor
capacity and work participation.

The size of a country's labor force influences its per capital agricultural output be-
cause of applicability of the principle of diminishing returns, or more accurately, the
principle of variable proportions. According to this principle, output per worker varies
with changes in the number of persons who work a given area of land, other things re-
maining unchanged. These variations follow a three-stage pattern: (1) the stage in which
butput per person increases as population increases; (2) the stage in which output per







worker decreases with increases in population, but in which the marginal output of labor
is positive and total output increases with increases in number of workers; and (3) the
stage in which total output decreases with increases in number of workers.

Agricultural rather than total population is the more relevant statistic for examining
the operation of this principle as it applies to agricultural production. Precise measure-
ment of the influence of size of a country's agricultural population upon its agricultural
output would require knowledge of the contours of the curves relating output to changes
in intensity of labor use. The closest approximationto such information now available for
the study countries is that provided in statistics on hectares of arable land and value of
agricultural output per agricultural worker (table 49). This information would be fully
adequate for such purposes if the schedules relating output per worker to changes in
number of workers per unit of land were approximately alike for all countries. But the
contours of such schedules vary from country to country, depending upon differences in
soils and climate, level of adaptable farm technology, price elasticities (applicable when
output is measured in value terms), amount of capital per unit of land, and other factors.


Table 49.--Value of


agricultural output per agricultural worker and per hectare of arable
land, 23 study countries, specified years


Total Agricultural Agricultural output, 1960 Changes in
workers per agricultural
Country agricultural 100 hectares Per Per hectare output per
workers, agricultural
w190 orof arable agricultural of arable agricltrl
land, 1960 worker land 1950-6
1950-60

(1) (2) (3) (4) (5)

Thousands Number -------U.S. dollars-------- Percent

Argentina........... 2,161 4.9 1,080 78 NA
Chile............... 646 11.8 547 59 NA
Jordan.............. 134 14.7 NA NA NA
Tunisia............. 971 18.5 NA NA NA
Iran............... 3,743 22.2 NA NA NA

Spain............... 4,803 22.7 656 150 NA
Mexico............. 5,948 24.4 369 110 NA
Venezuela........... 751 31.2 500 150 NA
Israel............. 122 33.3 1,825 557 33
Turkey.............. 9,737 38.5 326 127 NA

Poland.............. 6,541 41.7 616 252 NA
Colombia............ 2,544 52.6 531 270 1
Greece............. 1,940 52.6 391 205 48
Yugoslavia.......... 4,693 55.6 250 141 NA
Costa Rica......... 214 71.4 438 320 NA

Brazil.............. 13,555 71.4 229 104 10
India............... 128,214 83.3 114 91 NA
Pakistan........... 18,636 83.3 182 133 NA
Philippines......... 5,383 83.3 181 139 NA
Thailand........... 11,334 111.1 94 106 NA

Taiwan............. -- 166.7 228 477 50
UAR................. 4,403 166.7 365 643 NA
Japan............... 14,346 250.0 402 961 76


1 Ratio of workers to arable land
because of inadequate statistics on


not ascertained for Nigeria, Sudan, and Tang;
land area or number of agricultural workers.


anyika






At best, therefore, international comparisons can provide only crude indicators of
the influence of size of agricultural population on output and productivity. The range of
possible influences would be appreciably narrowed if we could assume that none of the
study countries were now operating under conditions either of increasing average returns,
or of zero or negative marginal returns inthe application of labor to land. If this assump-
tion is tenable, it means that none of the countries could increase its output per agri-
cultural worker merely by increasing the number of workers, and that none could increase
its total agricultural output merely by reducing the size of its agricultural population.
Rather, all of the study countries would be operating under conditions of decreasing av-
erage yet positive marginal returns with respect to the size of their agricultural popu-
lation relative to agricultural land.

Among the study countries, there is a tendency for output per worker to be highest
in countries where the number of workers relative to area of arable land is lowest. This
tendency is not highly consistent, however. Argentina, for example, has the fewest agri-
cultural workers relative to arable land and ranks second among the 26 countries in value
of output per farm worker (table 49). Israel, on the other hand, ranks tenth among coun-
tries reporting arable land per worker, but is the leading country in value of agricultural
output per worker. Japan leads the study countries in number of agricultural workers per
hectare of arable land, but it ranks ninth in value of agricultural output per agricultural
worker. This low value is partly offset by the relatively large importance of nonfarm
work as a source of employment and income for Japanese farm workers.

Population has been increasing in all of the study countries since 1948 at annual
compound rates ranging from less than 1.0 percent in Spain to more than 3.0 percent in
Israel, Venezuela, Brazil, Taiwan, Thailand, the Philippines, Mexico, Nigeria, and Sudan
(table 47). Assuming a positive, instead of a zero or a negative, marginal productivity of
labor, the associated increases in agricultural population have contributed to increasing
total agricultural output in all of the study countries. A few countries, principally in South
America and Africa, have been able--because of their farmland expansion potentials--to
accommodate increases in agricultural population with little decrease from the output per
worker that they might otherwise have had. A few of these countries still have an under-
utilized land-expansion potential large enough to absorb their probable farm population
increases for another decade or more without incurring sharp decreases in output per
worker. To do this, however, will probably require the building of an infrastructure of
roads, schools, electric power facilities, etc., in newly developing areas somewhat com-
parable to those in already developed areas. It will thereby place heavy demands upon
scarce capital.

More densely populated countries, such as Taiwan and India, can accommodate in-
creases in their agricultural population and labor force mainly by increasing the intensity
of labor use on land already in highly labor-intensive uses. Most of these countries have
averted decreases in output per worker largely through technical improvements, land
development (as by irrigation and drainage), and increased capital investments (tables 6
and 49).


Economically Active Population

Generally, countries with a large portion of the labor force in agriculture and low
per capital income levels have a large percentage of their population in the economically
active category (table 50). Work participation by children and elderly persons is usually
high in less-developed countries. In the Philippines, 5 percent of the male labor force is
under 15 years of age, but in Japan, the proportion is negligible. Relatively high work
participation rates are associated with a predominance of the agricultural sector in the
economy, low school enrollment ratios, and little social legislation.







Table 50.--Percentage of population in the agricultural, economically active categories,
and under 15 years of age, selected countries and years

Percentage of--

SYear Total Economically Total
Country Year PuTota
Population active population
in economically population under 15
economically
agriculture active in years of
agriculture age

Group I -------------Percent--------------------

Israel................. 1961 2 18 35 18 36
Sudan .................. 1956 87 47 80 3 43
Mexico................. 1960 58 32 54 44
Costa Rica............. 1950 NA 34 55 43
Philippines............ 1961 4 69 37 58 46
Tanganyika............ 1948 NA NA NA 45

Yugoslavia............ 1961 50 45 57 31
Taiwan................. 1962 5 50 32 5 50 6 46
Turkey ................. 1960 7 72 47 75 41
Venezuela.............. 1961 31 32 32 45
Thailand............... 1960 2 66 53 82 43
Brazil................. 1950 NA 33 58 42
Greece................. 1961 8 52 48 49 27

Group II

Iran................... 1956 9 60 32 55 42
India.................. 1961 10 70 43 70 10 37
Poland................. 1960 38 47 47 34
Argentina .............. 1960 20 38 19 30
Chile.................. 1960 11 38 32 28 40
Japan.................. 1960 38 47 33 12 29

Spain.................. 1960 2 48 38 41 27
Colombia ............... 1951 9 46 33 54 43
Nigeria................ 1952-3 NA 13 48 NA 13 44
UAR.................... 1960 14 62 30 57 43
Pakistan............... 1961 10 92 34 15 65 45
Tunisia................ 1956 NA 34 68 41
Jordan................. 1960 NA 24 35 2 44

1 Countries are arranged in descending order according to annual compound rates of
change in crop production. 2 1950. 3 Under 12 years of age. 4 1948. 5 1956. 6 1961.
7 1945. 8 1949. 9 1960. 10 1951. 11 1940. 12 1962. 13 Indigenous population only.
14 Estimate. 15 1954-56.

Source: FAO, Production Yearbook, and International Labor Organization (ILO), Yearbook
of Labour Statistics.

The economically active population as a percentage of total population has been de-
clining relative to the increase intotal populationin most of the study countries (table 51).
Exceptions include Chile, Mexico, Pakistan, and Thailand where the ratio increased in
spite of an increase in the population under 15 years of age. The aging of the populations
is a partial explanation for the relative increase in the economically active populations
of Greece and Japan. Changes in definition of economically active population also account
for some of the variations reported.







Table 51.--Recent percentage changes in total economically active and agricultural
populations, selected countries and years


Change Changes in economically
Country1 Period in total active population
population Total Agricultural
population population


Group I Years ---------------------Percent------------------

Israel................. 1952-61 52 42 NA
Mexico................. 1950-60 35 36 27
Philippines............ 1948-61 36 31 16
Yugoslavia............. 1953-61 10 6 -9
Taiwan................. 1956-62 23 17 NA

Turkey................. 1950-60 33 3 -9
Venezuela .............. 1950-61 49 41 10
Thailand............... 1947-60 51 54 49
Brazil................. 1940-50 26 22 5
Greece................. 1951-61 10 2 14 2 -4

Group II

India.................. 1951-61 23 3 35 3 34
Poland................. 1950-60 19 12 -8
Argentina.............. 1947-50 28 18 -10
Chile.................. 1952-60 24 26 5
Japan .................. 1950-60 12 21 -17

Spain.................. 1950-60 9 8 -9
Colombia............... 1938-51 29 -18 -39
UAR ................... 1947-60 36 20 7
Pakistan............... 1951-61 22 35 NA

1 Countries arranged in descending order according to annual compound rate of change in
crop production during the period 1948-1963.
2 Estimate.
3 The 1951 and 1961 data are not strictly comparable. The definition of economically
active population was changed in the 1961 census.

Source: FAO, Production Yearbook, and ILO, Yearbook of Labour Statistics.


Qualitative Factors Affecting Supply of Labor
A country's supply pf labor is a function not only of the size of its population, but
also of qualitative attributes. These include nutritional andhealth levels, kinds and levels
of education, and traditions, mores, and social patterns which proscribe particular kinds
of work or influence the values placed upon material welfare, work, and nonwork ac-
tivities.

Health Conditions

No fully adequate measures of differences among the study countries in health con-
ditions are available. Infant mortality rates andpercentages of deaths occurring at age 50
and older are among the better available indicators; they reflect differences in medical
services, sanitation, incidence of disease, nutritional levels, and living and working
conditions. These two indicators have been used for rating general health conditions
in the study countries (table 52).







Table 51.--Recent percentage changes in total economically active and agricultural
populations, selected countries and years


Change Changes in economically
Country1 Period in total active population
population Total Agricultural
population population


Group I Years ---------------------Percent------------------

Israel................. 1952-61 52 42 NA
Mexico................. 1950-60 35 36 27
Philippines............ 1948-61 36 31 16
Yugoslavia............. 1953-61 10 6 -9
Taiwan................. 1956-62 23 17 NA

Turkey................. 1950-60 33 3 -9
Venezuela .............. 1950-61 49 41 10
Thailand............... 1947-60 51 54 49
Brazil................. 1940-50 26 22 5
Greece................. 1951-61 10 2 14 2 -4

Group II

India.................. 1951-61 23 3 35 3 34
Poland................. 1950-60 19 12 -8
Argentina.............. 1947-50 28 18 -10
Chile.................. 1952-60 24 26 5
Japan .................. 1950-60 12 21 -17

Spain.................. 1950-60 9 8 -9
Colombia............... 1938-51 29 -18 -39
UAR ................... 1947-60 36 20 7
Pakistan............... 1951-61 22 35 NA

1 Countries arranged in descending order according to annual compound rate of change in
crop production during the period 1948-1963.
2 Estimate.
3 The 1951 and 1961 data are not strictly comparable. The definition of economically
active population was changed in the 1961 census.

Source: FAO, Production Yearbook, and ILO, Yearbook of Labour Statistics.


Qualitative Factors Affecting Supply of Labor
A country's supply pf labor is a function not only of the size of its population, but
also of qualitative attributes. These include nutritional andhealth levels, kinds and levels
of education, and traditions, mores, and social patterns which proscribe particular kinds
of work or influence the values placed upon material welfare, work, and nonwork ac-
tivities.

Health Conditions

No fully adequate measures of differences among the study countries in health con-
ditions are available. Infant mortality rates andpercentages of deaths occurring at age 50
and older are among the better available indicators; they reflect differences in medical
services, sanitation, incidence of disease, nutritional levels, and living and working
conditions. These two indicators have been used for rating general health conditions
in the study countries (table 52).







Table 52.--Indicators of health conditions, 26 study countries arrayed by per capital gross
national product and output per farm worker, specified years

Per capital Agricultural Infant Percentage
Country gross domestic output per mortality of deaths Health
national farm worker, rates, per at age 50 rating'
product, 1960 1960 1,000, 1955-59 and over, 1960

---------U.S. dollars--------- Number Percent Rating

Israel......... 905 1,674 2 32 2 71 1
Venezuela...... 650 498 64 34 2
Poland......... 538 616 75 66 1
Argentina...... 465 1,598 60 59 1
Chile.......... 405 545 118 3 38 2

Spain.......... 372 656 52 3 74 1
Japan........... 337 402 38 73 1
Mexico......... 321 358 78 3 29 2
Greece......... 297 387 41 76 1
Turkey......... 254 326 NA 3 36 2

Costa Rica..... 251 438 79 31 2
Colombia ...... 248 536 101 28 3
Yugoslavia..... 179 249 99 3 58 1
UAR............ 155 365 130 4 27 3
Jordan......... 153 NA 70 28 2

Tunisia........ 145 NA 5 44 4 5 63 1
Brazil......... 145 229 6 170 4 21 3
Philippines.... 113 181 83 29 2
Taiwan......... 97 247 34 NA 1

Nigeria........ 95 NA 78 NA 3
Thailand....... 84 94 55 3 29 2
India.......... 70 113 8 146 4 26 3
Sudan.......... 66 NA 94 NA 3
Pakistan....... 64 165 9 107 NA 3
Tanganyika..... 57 NA 7 170 NA 3


1 The numbers 1, 2, and 3 denote most favorable, moderately favorable,, and least favor-
able health conditions, respectively. 2 Jewish population only. 3 1957-59 period.
4 1950-52 period. 5 European population only. 6 1940-50 period.
7 1945-49 period. 8 For rural areas only. 9 1951-54 period.
Source: United Nations (55).

Generally, countries with the highest levels of agricultural output per agricul-
tural worker had the most favorable health conditions. The 5 leading countries in this
category were Israel, Argentina, Spain, Poland, and Chile. Of these, all except Chile were
in the most favorable category. The 6 lowest countries in output per worker were
Thailand, India, the Philippines, Pakistan, Brazil, and Taiwan. Of these, India, Pakistan,
and Brazil were in the least favorable class; Thailand and the Philippines were in the
moderately favorable class; and Taiwan was in the most favorable class. In Taiwan,
large-scale, aggressive health and sanitation programs sponsored by the central gov-
ernment and supported by large numbers of the population have been major factors in
improving general health conditions. Taiwan's experiences indicate that despite low
incomes, health conditions can be improved in countries that have the will to do so.
In recent years, health conditions have improved inmost of the study countries. This
is reflected by the decline ininfant and childhood mortality, and in infectious and parasitic







diseases. Most of the countries, however, still have very inadequate housing, sanitation,
and medical facilities.
In spite of recent progress, large numbers of people in underdeveloped countries
are still affected by infectious and parasitic diseases. Approximately one-sixth of the
world's population is afflicted with trachoma, a disease causing blindness. In some
tropical countries, malaria is still widespread, and the incidence of tuberculosis is
second only to malaria. Pestilential diseases, such as smallpox, plague, cholera, yellow
fever, typhus, and relapsing fever, most frequently occur in the world's tropical and
semitropical regions; however, incidence of these diseases has been greatly reduced
during recent years as a result of large-scale eradication programs.
State of health is a function of environment and nutrition as well as of medical fa-
cilities. The elimination of disease carriers is an important approach to eradicating
parasitic diseases. For example, two-thirds of Tanganyika is uninhabitable because of
the tsetse fly. Its elimination would reduce the incidence of disease and open up new
lands for cultivation. Such measures often must be accompanied by improvements in
environmental factors. For example, water is the carrier of a snail-causing bilharziasis,
a debilitating disease which affects an estimated 150 million people in rural areas.
Improved sanitation will be necessary to eliminate the disease.
Undernutrition (insufficient calorie intake) and malnutrition (imbalance in the diet)
often account for lethargy, lack of initiative and drive, low resistance to disease, and
quick tiring at work (table 53). Improvements in nutrition will also increase employment
capacities of rural people in the world's less-developed countries.

Table 53.--Calorie levels as percentages of requirements and protein
consumption per capital, 17 study countries, 1957-58 1959-601

2 C Protein level (per capital)
Calorie
level Total Animal origin

Percent Grams Grams
Israel..................... 110 81 33
Mexico..................... 100 68 20
Philippines................ 85 47 14
Yugoslavia................. 111 95 26
Taiwan..................... 102 57 14
Turkey..................... 117 90 14
Venezuela.................. 92 62 25
Brazil..................... 112 3 67 3 19
Greece..................... 120 93 26
India....................... 84 52 6
Argentina.................. 120 98 57
Chile....................... 99 3 77 3 26
Japan ...................... 74 67 17
Spain...................... 104 71 20
Colombia................... 88 4 48 4 23
UAR ....................... 108 76 13
Pakistan.................... 88 46 7

1 Calorie and protein levels are generally much lower in rural than in
urban areas.
2 Countries arranged in descending order, according to annual compound
rates of change in crop production.
3 1957.
4 1956-58.
Sources: The World Food Budget 1970, Foreign Agr. Econ. Rpt. 19, U.S.
Dept. Agr. Oct. 1964, and United Nations (55).







Educational Levels and Programs


Development of human knowledge and skills is an essential component of economic
progress. No other factor has contributed more to man's growing capacity to increase
his output of goods and services. The world's economically advanced nations have long
assigned high priority to increasing knowledge through research and to increasing the
level of education and skills of all of their people. Therefore, these nations stand in
sharp contrast to the world's less-developed nations in levels of education and skills
(fig. 9), and in size of the stock of knowledge applicable to increasing production, espe-
cially in agriculture.
Although available statistics on educational levels in many study countries are in
some ways restricted, indicators as illiteracy rates, educational attainments of those
25 years of age and over, and percentage of children in eligible ages enrolled in school
(table 44) have considerable value. A composite index of primary and secondary school
enrollment in 1950 has been used for rating the countries according to the educational
levels of their present adult population and for classifying them into the three groups,
most favorable, moderately favorable, and least favorable (table 54).

All of these indicators relate to the total population rather than to the rural or agri-
cultural sector. Educational levels in rural areas are consistently lower than in urban
areas. For instance, only 3 children in the rural areas of Brazil for every 100 in urban
areas completed 5 years of schooling. In the Philippines, 84 percent of the 7-to-13 age
group in urban areas, compared to 68 percent in rural areas, attended school in 1957.
Factors associated with the rural-urban education differential include sparsity of popu-
lation, inadequate transportation, unwillingness of qualified teachers to live in rural
areas, and reluctance of families to forego the assistance of children at home. Moreover,
many families in rural society do not appreciate education because of the seeming in-
applicability of knowledge gained through schooling. Lack of facilities for secondary and
higher education lessens the appreciation of even primary education.
Among study countries, higher education levels are generally associated with higher
per capital incomes, higher productivity, and more rapid growth of per capital agricultural
production. Countries with an education rating of 1 have an average per capital GNP of
$437, output per worker of $641, and 2.1 percent annual change in per capital crop pro-
duction. The relevant figures for countries with a rating of 2 are, respectively, $221,
$336, and .9 percent. For countries with a rating of 3, the relevant figures are $123,
$240, and 1.1 percent.
There are numerous exceptions to the above general relationships, particularly
among countries with ratings of 2 and 3. The per capital GNP in Costa Rica, with a rating
of 2, is $438; in Greece, with a rating of 1, it is $387. The rapid growth of Sudan and
Tanganyika probably reflects production on commercial farms where good management
has probably substituted for low educational levels. Moreover, while a highly developed
economy may require a relatively high level of education, a high educational level will
not assure a rapid rate of economic growth unless other requisites for development are
favorable. Rather, educational levels can be in part a function of income levels such that
a rise in income, associated with an increase in productivity, often finances educational
expansion (Bowman, 6). These considerations raise questions concerning the proper
investment priority assignable to education. It has often been held that a large expansion
of educational facilities is a prerequisite of sustained growth. An alternative hypothesis
is that educational expansion is inseparably linked with growth as both product and con-
tributor. Needed levels and rates of expansion of education depend in part on the levels
of development already achieved. A goal of universal education through the elementary
school level, coupled with enough progress in higher levels of education to service such
an expanded elementary school program, would be an exceedingly ambitious goal for most
of the study countries.
The quality of education in many of the study countries is low by Western standards.
Often, school curricula at all levels of instruction are characterized by excessive work
loads and emphasis on detail. Teaching methods are rigid, with emphasis on memoriza-
tion rather than on developing a spirit of inquiry and power of observation. Class in-
struction often bears little relationship to everyday experience. Such characteristics










LITERACY RATE* 26 COUNTRIES
n n 180 160 140 120 100 80 60 40 20 0 20 40 60 80 100
Boundones ore not necessarily those -
recognized by the U.S Govenment




SARTIC OCEAN
/ \


:POLAND

4 C0 / YU GOSLAVIA

i- 20 .. GRECE TURKEY

-- --, mIEGYPT JORDAN


U.S. DEPARTMENT OF AGRICULTURE NEG. ERS 3608-65(4) ECONOMIC RESEARCH SERVICE

Figure 9








Table 54.--Indicators of educational levels, 26 study countries arrayed by per capital gross national product

Annual Percentage of population 25 years and older, by Percentage of
compound rate level of schooling completed2 children in
of change Literacy primary and Education
Country in crop rateF Less than First Second Third secondary rating3

1948-63 le level level level schools, 1950

------------------------------------------Percent-------------------------------------------- Rating

Israel............... 9.7 96 4 43 4 32 4 21 4 4 58 1
Venezuela ............ 4.5 52 NA NA NA NA 30 2
Poland................ 3.0 95 52 35 10 3 53 1
Argentina ............ 2.8 86 5 38 57 54 5 1 51 1
Chile................. 2.8 80 24 55 19 2 50 1

Spain................ 2.7 87 628 667 6 4 61 43 1
Japan ................ 2.8 98 3 66 25 6 69 1
Mexico ............... 6.3 65 40 7 53 7 5 72 30 2
Greece................ 3.7 80 45 844 9 82 53 1
Turkey ............... 4.5 39 83 712 74 71 24 3

Costa Rica........... 5.6 79 63 33 3 1 37 2
Colombia.............. 2.6 62 53 40 6 1 22 3
Yugoslavia........... 5.1 77 937 51 911 91 51 1
UAR .................. 2.0 20 NA NA NA NA 20 3
Jordan............... -1.9 32 NA NA NA NA 15 3

Tunisia............... 1.6 16 NA NA NA NA 15 3
Brazil............... 4.2 49 80 16 3 1 21 3
Iran................. 3.6 15 94 5 1 -- 13 3
Philippines.......... 5.2 75 10 70 10 25 10 2 10 3 59 2
Taiwan .............. 4.5 11 54 57 34 5 4 38 2

Nigeria.............. 2.6 11 NA NA NA NA 12 3
Thailand............. 4.4 68 61 36 3 -- 38 2
India................ 3.1 24 8 97 8 2 8 0.5 8 0.5 19 3
Sudan................ 8.0 7 5 89 5 10 5 0.5 5 0.5 4 3
Pakistan............. 1.8 6 19 91 6 2 1 17 3
Tanganyika........... 5.2 7 NA NA NA NA 7 3

1 For population 15 years and older.
2 The first level includes those completing 4 years of primary schooling but less than 4 years of secondary school; the second
level includes those completing 4 years of secondary but less than 4 years of higher schooling; and the third level includes those
completing 4 or more years of higher schooling.
SThese are based on ratio of primary and secondary school enrollment to size of population in eligible school enrollment ages
in 1950. Countries with ratios of 40 percent or more are rated 1, those with ratios of 30 to 39 percent are rated 2, and those
with ratios under 30 percent are rated 3.
4 1954. 5 Population over 20 years of age. 6 All ages. 7 1950. 8 1951. 9 Population over 10 years of age. 10 1948.
11 Population over 6 years of age.

Source: United Nations (55).

have encouraged unqualified acceptance of instruction and have stymied the creativity
needed for progress.

One measure of the effort being made by governments to improve education is per
capital expenditure on education as a percent of per capital GNP (table 55). These range
from 1.0 percent in Spain to 5.5 percent in Japan. They are low in Mexico, Pakistan,
Greece, India, Colombia, Nigeria, and relatively high in Taiwan, Tanganyika, and the
United Arab Republic.

Population growth, inadequate transportation and communication, and variations in
language and dialect (as in India, the Philippines, and most of Africa) represent signifi-
cant barriers to educational progress. But in spite of these obstacles, during the past
decade primary enrollment ratios increased in all of the study countries except Greece,
Poland, and the Philippines.

Primary and university levels of instruction have generally dominated the educational
systems of developing countries. Provisions for vocational and technical training are
usually considered inadequate, particularly in view of the great need for technicians in
most underdeveloped countries. The United Arab Republic andlsrael are exceptions.

There is often little demand for vocational schooling among students, just as there
is little demand for technical subjects in secondary schools of general instruction or in
universities. Prestige is primarily, if not exclusively, associated with highly academic







Table 55.--Expenditure on education as a percentage of per capital GNP, and distribution
of expenditure, 24 study countries

Percentage distribution of expenditure, 1956-59
Total
Country1 educational Pre-primary Administration
Secondary Higher
expenditure and primary ec euaand other
education expenses

Group I ------------------------------Percent--------------------------

Israel2 ............. 3 3.0 66.0 9.4 8.0 16.6
Sudan ............... NA 42.4 39.9 -- 17.7
Mexico2.............. 4 1.1 NA NA NA NA
Costa Rica5.......... 3.1 NA NA NA NA
Philippines.......... 2.7 83.8 15.6 .5 0.1

Tanganyika........... 3.4 44.0 43.6 5.6 6.8
Yugoslavia2 .......... 3.0 59.7 23.1 16.5 0.7
Taiwan2 .............. 3.4 NA NA NA NA
Turkey2.............. 4 2.2 NA NA NA NA
Venezuela2........... 3 2.1 NA NA NA NA

Thailand2............ 2.5 65.5 24.5 2.9 7.1
Brazil............... 2.3 39.1 20.2 24.3 16.4
Greece2.............. 4 1.6 NA NA NA NA

Group II

India2............... 4 1.7 32.1 35.2 18.0 14.7
Poland............... 4.2 NA NA NA NA
Argentina2........... 3.1 NA NA NA NA
Chile2 .............. 4 2.4 NA NA NA NA

Japan................ 5.5 32.0 30.6 11.8 25.6
Spain2............... 3 1.0 61.0 6.9 12.1 20.0
Colombia............. 1.9 43.6 19.6 16.4 20.4
Nigeria6............. 1.9 64.4 23.0 1.5 11.1
UAR ................. 4 3.9 NA NA NA NA

Pakistan............. 1.3 33.0 36.5 16.1 14.4
Tunisia............... NA 56.6 7 27.6 4.4 11.4

1 Includes special and adult education among others. 2 Capital expenditure not included.
3 Expenditure by central government only. Expenditure by Ministry of Education only.
5 Not known whether capital expenditure included. 6 Not including Southern Cameroons.
7 Includes teacher training.

Source: UNESCO (63).

subjects, such as the humanities and the fine arts. These subjects are emphasized as
preparation for the professions of law, medicine, and civil service, which are highly
esteemed because of their association with the governing class. Moreover, students
concentrating in a technical subject, such as agriculture, often plan to enter the civil
service in an administrative capacity upon graduation. In 1958, Brazil's agricultural
schools at the secondary level had a capacity of 20,000 but an enrollment of 5,000, while
university level enrollment in agriculture was only 57 percent of capacity (UNESCO, 63).
At the same time, unemployment among the professionals is uncommonly high in some
countries, notably India and the Philippines. Unemployed university graduates often
refuse to seek employment in a field in which they did not specialize.







The quality of university graduates, especially of those who become administrators,
is crucial to developing countries. The developing countries have less need for large
numbers of mass-produced college graduates thanfor a smaller number of men of highest
quality (Hunter, 27).


Agricultural Extension

Agricultural extension or technical assistance programs to help farm people learn
and apply improved ways of farming, better business practices, and more effective
patterns of cooperation have made vast contributions to agricultural development in the
United States, Japan, and a few other countries. These programs have also contributed
directly to expanding the intellectual horizons, knowledge, and skills of farm people.

Until recent years, several of the study countries had no agricultural extension
programs, but most of them have now begun to develop this kind of education (table 56).
In some cases these programs have emerged as projects supported by AID, FAO, or
private foundations. In general, such programs have been in operation for too little time

Table 56.--Ratios of farm holdings and economically active persons in
agriculture to extension workers in selected countries, 19591

Economically
Total Farm holdings active in
Country extension per extension agriculture
workers worker2 per extension
worker

--------------------Number---------------------

Israel.................. 610 38 157
Philippines............ 1,623 1,010 3,497
Taiwan.................. 884 NA 1,698
Turkey................. 1,758 NA 5,539
Venezuela............... 332 749 2,331

Thailand.............. 328 6,438 34,555
Greece................. 4,851 206 403
Iran................. 648 NA 5,130
India3................. 48,579 913 2,696
Argentina.............. 544 1,005 4,193

Chile.................. 154 980 4,208
Japan................ 13,566 4 445 728
Spain .................. 206 NA 23,316
Nigeria................. 950 NA NA
Jordan................. 90 1,023 NA

1 These ratios are merely crude indicators of the adequacy of the
supply of extension personnel. The total number of extension workers
rather than the number of field workers was used for the computations
due to data limitations.
2 Data for farm holdings pertain to a year around 1950.
3 Including all community development employees.
4 Data for farm holdings pertain to 1960.


Sources: C. W. Chang, Extension Education for Agricultural and Rural
Development, Bangkok, 1963, FAO, Informe del Centro Sudamericano de
Extension Agricola, 1959., U.N. Compendium of Social Statistics: 1963,
and reports from AID personnel.







or on too limited a scale to have yet had a large impact upon agricultural production.
Moreover, establishment of an effective extension program is no easy task in most of
the world's less-developed countries.

Agricultural extension programs are most effective when supported by a large fund
and a constantly increasing stock of improved technologies. In the United States and
Japan, highly effective agricultural research programs have long assured improved
technologies. Some technical improvements produced through this research, such as
improved insecticides, can be readily adapted to the agriculture of other countries.
Other improvements, such as some of the higher yielding crop varieties, have limited
geographic application; mechanical inventions have varying degrees of economic value
because countries differ in their relative needs for capital and labor-saving innovations.
Such limitations in transferability will limit the effectiveness of extension programs in
many of the underdeveloped countries until they also build strong agricultural research
programs.


Cultural Patterns and Value Orientations

Cultural factors which influence valuations of material welfare, work, and nonwork
activities are generally believed to affect demand for goods and services, availability of
resources, incomes, savings, and investments. These include kinship ties and attitudes
toward change as influenced by family structure, customs, religion, exposure to economic
development via luxury consumer goods, and education. For example, the number of
holidays in most countries is influenced by religion. So too are food consumption patterns,
health conditions, and the economic worth of particular kinds of food-producing activities.

Investigation of the influence of cultural and value differences upon differences in
levels and rates of change in agricultural output and productivity between countries is
complicated for several reasons. For one thing, cultural patterns and, in turn, the
strength of economic or "capitalist" values often differ markedly from area to area and
among various population groups within the same country as well as across countries.
Indeed, few nations are without some population groups whose economic motivations or
"capitalist" values are relatively strong. These, if they can be identified, provide a basis
for the beginnings of development.

Moreover, a particular cultural and value feature can both impede and facilitate
progress. This is true for some factors that can simultaneously influence economic
development from the point of view of both demand and supply. For example, religious
holidays, such as the Christmas season in the Western world, can adversely affect the
available supply of labor and yet greatly stimulate development through influence upon
wants and market demand for goods.

Finally, cultural patterns and values are qualities that have been formed and modified
over time. They are always influencing the direction and rate of development--some
through their influence on wants, or on the available supply of labor and other factors,
or on both supply and demand. However, instead of being static, or "given," they them-
selves often become one of the products of the development they help to influence. For
example, in the United States attitudes toward child labor have changed markedly since
1800 because of changes in technology, income levels, emphasis upon education, and
industry structure. As another example, in parts of India introduction of factories which
offer jobs not easily fitted into established job and related caste categories is having
considerable influence upon traditional caste relations. Existing caste relations, mean-
time, influence the variety of operations any worker can perform. If labor were expen-
sive and highly inelastic in its supply, this could easily lead to prohibitive labor costs.
However, where labor is very cheap and supply highly elastic, such limitations--although
influencing the interpersonal and intergroup distribution of jobs--may have very little
influence on labor costs per unit of output and, therefore, little influence on economic
development.
8This section is a brief summation of an analysis that is still in a preliminary stage.







Study of cultural patterns and values will be most useful for economic analysis if
the various ways in which cultural patterns influence development can be related to
basic economic categories or terms, such as demand, supply, and scarcity. Also, the
economic influence of cultural patterns and values can be best evaluated when examined
within the framework of a general theory of development. This will make it easier to
distinguish the influence of these factors from that of other factors such as market
demand, availability of production requisites, and the availability of adaptable technologies
more productive than those now inuse. Not even the latter factors are wholly uninfluenced
by cultural considerations. Yet, care must be takenlest cultural patterns that are different
and that can be markedly changed only between generations are held responsible for
limitations of other kinds.












CHAPTER 7.--CAPITAL AND CREDIT


Present Capital Features


Capital on Farms

More than any other feature, differences in capital resources distinguish the agri-
culture of underdeveloped countries from that of economically advanced regions. When
man first began to till the soil many centuries ago, his farm capital consisted of little
more than a handful of seeds gathered from forests and open areas, and of broken sticks
and stones to break and stir the soil. Farmers in economically advanced countries now
use modern machines, highly productive kinds of crops and livestock, and other farm
inputs that are the marvels of modern scientific and engineering achievement. Yet,
millions of tillers of the soil who live less than a day's travel away from modern agri-
culture still use only a few simple capital items. For many, these include such imple-
ments as crude hoes, blunt-edged axes, hand sickles, and wooden flails. At somewhat
higher levels, they include woodenplows, carts or wagons, and donkeys or oxen for drayage
and draft purposes. Many of these farmers save their seed from the preceding harvest
and use seed stock passed down from one generation to another. They have learned to use
both animal and human manure as well as straw and other plant materials as soil amend-
ments. Many, however, have never used chemical fertilizers, pesticides, hybrid seeds,
and other modern agricultural inputs.

These attributes of agriculture have been described by several anthropologists,
economists, and specialists in other disciplines, but quantitative information on farm
capital resources is available for only a few underdeveloped countries (Firth and
Yamey, 13). For some of these regions, it is available only for a few small areas or
case farms.

Information from the All-India Rural Credit Survey conducted in the early 1950's
shows the average value of farm assets of families in the wealthier and poorer halves of
the population (46). Assets of families in the upper strata had an average value of
8,376 rupees, equivalent at the exchange rate of 4.7 rupees per dollar to $1,782. In dollar
terms, this consisted of $1,199 in land, $337 in buildings and irrigation work, $173 in
livestock, $41 in implements and machinery, and $32 in other items. The lower strata
families had cultivation assets, in dollar terms, of only $506; of this amount, $297 was
in land, $123 in buildings and irrigation work, $68 in livestock, $11 in implements and
machinery, and $7 in other items.

Families in the upper strata had annual farm operating expenditures totaling
776 rupees ($165) per family, with 444 rupees ($94) paid in cash and 332 rupees ($71)
paid in kind. Those in the lower wealth strata had annual farm expenditures totaling
214 rupees ($45), with 121 ($26) paid incash and 93 rupees ($20) paid inkind. Cash expend-
itures in the lower strata included 18 rupees ($4) for seed, 8 rupees ($2) for manure,
29 rupees ($6) for hired labor, 29 rupees ($6) for fodder, and 37 rupees ($8) for other
items (46, pp. 830-51).

At the end of 1957, the average farm in Taiwan had total farm assets in U.S. dollars
of $3,820 (using the exchange rate of NT $29 = $1 U.S.). Land, averaging 4.05 acres per
farm, accounted for $2,983 of this amount, building and other land fixtures for $609,
livestock for $117, crop inventories for $68, and farm machinery and implements for $43.
Annual farm operating expenses for these farms in 1957 amounted to $343 per farm,
with $219 paid out in cash and $124 paid out in kind (Tsui, 62).












CHAPTER 7.--CAPITAL AND CREDIT


Present Capital Features


Capital on Farms

More than any other feature, differences in capital resources distinguish the agri-
culture of underdeveloped countries from that of economically advanced regions. When
man first began to till the soil many centuries ago, his farm capital consisted of little
more than a handful of seeds gathered from forests and open areas, and of broken sticks
and stones to break and stir the soil. Farmers in economically advanced countries now
use modern machines, highly productive kinds of crops and livestock, and other farm
inputs that are the marvels of modern scientific and engineering achievement. Yet,
millions of tillers of the soil who live less than a day's travel away from modern agri-
culture still use only a few simple capital items. For many, these include such imple-
ments as crude hoes, blunt-edged axes, hand sickles, and wooden flails. At somewhat
higher levels, they include woodenplows, carts or wagons, and donkeys or oxen for drayage
and draft purposes. Many of these farmers save their seed from the preceding harvest
and use seed stock passed down from one generation to another. They have learned to use
both animal and human manure as well as straw and other plant materials as soil amend-
ments. Many, however, have never used chemical fertilizers, pesticides, hybrid seeds,
and other modern agricultural inputs.

These attributes of agriculture have been described by several anthropologists,
economists, and specialists in other disciplines, but quantitative information on farm
capital resources is available for only a few underdeveloped countries (Firth and
Yamey, 13). For some of these regions, it is available only for a few small areas or
case farms.

Information from the All-India Rural Credit Survey conducted in the early 1950's
shows the average value of farm assets of families in the wealthier and poorer halves of
the population (46). Assets of families in the upper strata had an average value of
8,376 rupees, equivalent at the exchange rate of 4.7 rupees per dollar to $1,782. In dollar
terms, this consisted of $1,199 in land, $337 in buildings and irrigation work, $173 in
livestock, $41 in implements and machinery, and $32 in other items. The lower strata
families had cultivation assets, in dollar terms, of only $506; of this amount, $297 was
in land, $123 in buildings and irrigation work, $68 in livestock, $11 in implements and
machinery, and $7 in other items.

Families in the upper strata had annual farm operating expenditures totaling
776 rupees ($165) per family, with 444 rupees ($94) paid in cash and 332 rupees ($71)
paid in kind. Those in the lower wealth strata had annual farm expenditures totaling
214 rupees ($45), with 121 ($26) paid incash and 93 rupees ($20) paid inkind. Cash expend-
itures in the lower strata included 18 rupees ($4) for seed, 8 rupees ($2) for manure,
29 rupees ($6) for hired labor, 29 rupees ($6) for fodder, and 37 rupees ($8) for other
items (46, pp. 830-51).

At the end of 1957, the average farm in Taiwan had total farm assets in U.S. dollars
of $3,820 (using the exchange rate of NT $29 = $1 U.S.). Land, averaging 4.05 acres per
farm, accounted for $2,983 of this amount, building and other land fixtures for $609,
livestock for $117, crop inventories for $68, and farm machinery and implements for $43.
Annual farm operating expenses for these farms in 1957 amounted to $343 per farm,
with $219 paid out in cash and $124 paid out in kind (Tsui, 62).












CHAPTER 7.--CAPITAL AND CREDIT


Present Capital Features


Capital on Farms

More than any other feature, differences in capital resources distinguish the agri-
culture of underdeveloped countries from that of economically advanced regions. When
man first began to till the soil many centuries ago, his farm capital consisted of little
more than a handful of seeds gathered from forests and open areas, and of broken sticks
and stones to break and stir the soil. Farmers in economically advanced countries now
use modern machines, highly productive kinds of crops and livestock, and other farm
inputs that are the marvels of modern scientific and engineering achievement. Yet,
millions of tillers of the soil who live less than a day's travel away from modern agri-
culture still use only a few simple capital items. For many, these include such imple-
ments as crude hoes, blunt-edged axes, hand sickles, and wooden flails. At somewhat
higher levels, they include woodenplows, carts or wagons, and donkeys or oxen for drayage
and draft purposes. Many of these farmers save their seed from the preceding harvest
and use seed stock passed down from one generation to another. They have learned to use
both animal and human manure as well as straw and other plant materials as soil amend-
ments. Many, however, have never used chemical fertilizers, pesticides, hybrid seeds,
and other modern agricultural inputs.

These attributes of agriculture have been described by several anthropologists,
economists, and specialists in other disciplines, but quantitative information on farm
capital resources is available for only a few underdeveloped countries (Firth and
Yamey, 13). For some of these regions, it is available only for a few small areas or
case farms.

Information from the All-India Rural Credit Survey conducted in the early 1950's
shows the average value of farm assets of families in the wealthier and poorer halves of
the population (46). Assets of families in the upper strata had an average value of
8,376 rupees, equivalent at the exchange rate of 4.7 rupees per dollar to $1,782. In dollar
terms, this consisted of $1,199 in land, $337 in buildings and irrigation work, $173 in
livestock, $41 in implements and machinery, and $32 in other items. The lower strata
families had cultivation assets, in dollar terms, of only $506; of this amount, $297 was
in land, $123 in buildings and irrigation work, $68 in livestock, $11 in implements and
machinery, and $7 in other items.

Families in the upper strata had annual farm operating expenditures totaling
776 rupees ($165) per family, with 444 rupees ($94) paid in cash and 332 rupees ($71)
paid in kind. Those in the lower wealth strata had annual farm expenditures totaling
214 rupees ($45), with 121 ($26) paid incash and 93 rupees ($20) paid inkind. Cash expend-
itures in the lower strata included 18 rupees ($4) for seed, 8 rupees ($2) for manure,
29 rupees ($6) for hired labor, 29 rupees ($6) for fodder, and 37 rupees ($8) for other
items (46, pp. 830-51).

At the end of 1957, the average farm in Taiwan had total farm assets in U.S. dollars
of $3,820 (using the exchange rate of NT $29 = $1 U.S.). Land, averaging 4.05 acres per
farm, accounted for $2,983 of this amount, building and other land fixtures for $609,
livestock for $117, crop inventories for $68, and farm machinery and implements for $43.
Annual farm operating expenses for these farms in 1957 amounted to $343 per farm,
with $219 paid out in cash and $124 paid out in kind (Tsui, 62).







In major cocoa producing provinces of Nigeria, the average family--consisting of
8.6 persons--had an available total land area of 36.6 acres in 1952. Field survey data ob-
tained for 738 families inthese provinces indicated an average value of "durable property"
of about $550 per family. This included about $55 worth of "business equipment" con-
sisting of farm implement, craft, and transport items. These included cement platforms
for drying cocoa, looms and sewing machines, cars, lorries and bicycles, carpenter
tools, and guns of hunters, as well as farm equipment. Farm equipment per family
had a reported value of only $22. In a few cases, this included imported axes and spades;
but in general the farm equipment consisted only of hoes, broad heavy knives called
machetes or cutlasses, knives attached to long poles for harvesting cocoa pods from the
higher branches, and a number of large baskets used to carry crops and other goods
between farm and home and between home and market (Galletti, Baldwin, and Dina,
20, pp. 133-233). In addition to their "durable property," the average family had about 5
head of sheep or goats and 15 fowls.

Japan has achieved a much higher level of output per worker and per unit of land
than all other Asian countries except Israel. Assets per Japanese farm in 1958 had an
average value in U.S. dollars of $3,465. Of this amount, land accounted for only 25.7 per-
cent, compared with 78 percent in Taiwan. Buildings accounted for $1,586 or 45.8 percent;
farm equipment for $144 or 4.2 percent; livestockfor $128; and cash on hand and in banks
for $564. Farm operating expenses averaged $304 per farm. Some major expense items
included fertilizers averaging $70 per farm, tools and equipment $49, feed purchases $43,
and maintenance of farm buildings $29 (Yang, 72).

In Israel, average investment per established family farm (excluding land) for
1954-58 at 1954 prices was about $5,900. Of this amount about $3,000 was invested in
structures and equipment, $2,550 in livestock, and $350 in orchards (Mundlak, 40). Of the
$3,000 in structures and equipment, about $450 was in farm machinery and implements.
In 1954, these farms had a total land area of 12.75 acres per farm and an irrigated area
of 5.8 acres per farm. This is much more land than is used per family in either Taiwan
or Japan.

Estimates have not been compiled for the other study countries, but the amount of
capital per farm in most of the study countries probably lies between the extremes
reported for India and Israel. Investments per farm are at the lower end of this range
in Pakistan, Thailand, and Tanganyika, somewhat higher in Egypt, Sudan, Iran, the Philip-
pines, and Jordan, and higher still in the Latin American countries, with Argentina
appearing to have average capital assets per farm in excess of those in Israel. Against
these estimates, the average value of farm assets per farm in the United States in 1959
was about $54,000 (64).


Capital in Agricultural Service Facilities and General Infrastructure Features

Modern agriculture requires not only large amounts of capital on farms, but large
investments in industries, institutions, and facilities. These include industries engaged
in the manufacture of farm machinery, fertilizers, pesticides, pharmaceuticals, and
other items; industries engaged in assembly, storage, and processing of farm products;
industries engaged in the transport, distribution, and sales of factors and products;
irrigation dams and canals; farm credit agencies; agricultural education, extension,
and research institutions; and the infrastructure of roads, railroads, harbors, electric
power systems, schools, health and sanitation facilities serving both farm and nonfarm
sectors.

Measures of the stock of capital wealth used for such industries, institutions, and
facilities are not now available even for the United States, let alone for the study coun-
tries (Allen, 3). Some indication of major intercountry differences in such investments,
however, is provided by statistics on production of fertilizers, miles of hard surface
roads (table 76, Chapter 10), and electric power production, and by general information
on agricultural marketing facilities.







Among the study countries, Japan is the leading producer of commercial fertilizers
and of most of the other indicators of investments in agricultural service facilities.
Mexico and Argentina lead the Latin American countries. All of the Asian countries,
except Japan and Israel, and all of the African nations have very low investments.


Needs for More Capital

The need for more capital to increase agricultural output can be determined only
by close reference to its productivity relative to its costs. The closest approximation
to such information available on a national basis is that on capital-output ratios, as shown
in table 57 for 11 of the 26 study countries. These data relate average yearly increments
of capital to average yearly increases in agricultural output, but they do not account
for contributions of other factors to the increased output. Although they are crude meas-
ures, they do indicate a relativelyhighproductivityof capital in most of the less-developed
countries, and a generally lower productivity in the more developed countries. For
example, in Venezuela, Israel, Japan, Egypt, and Greece, the gross marginal productivity
of capital was much lower than in Thailand, Pakistan, India, and the Philippines.

Table 57.--Capital-output ratio and related marginal productivity of capital in specified
study countries1

Capital- Marginal Capital- Marginal
Country output productivity Country output productivity
ratio of capital2 ratio of capital2

Israel........... 3.70 0.27 Greece........... 1.14 0.88
Philippines...... 0.58 1.72 India........... 0.75 1.33
Yugoslavia....... 1.00 1.00 Japan........... 2.33 0.43
Taiwan........... 0.76 1.32 UAR............. 1.49 0.67
Venezuela........ 4.78 0.21 Pakistan........ 0.28 3.57
Thailand......... 0.26 3.85

1 These are incremental gross ratios and gross marginal productivity measures.
2 These are the reciprocals of the capital-output ratios.

Source: FAO, United Nations, 1964.

Estimates of capital productivity shown in table 57 need to be supplemented by
measurements which take account of factors besides capital. The measurements in
table 57 also reflect mainly the productivity of capital invested in traditional inputs
rather than the new kinds of inputs.

In most of the study countries, there is probably very little scope for investing much
additional capital per worker or per unit of land in traditional kinds of agricultural
input items. Additional capital is needed, however, for new improved kinds of inputs
essential to increasing agricultural output, e.g., seeds of improved crop varieties,
chemical fertilizers, pesticides, and improved implements. Capital is also required
for the manufacture, transport, and distribution of fertilizers, pesticides, and other
production requisites; for facilities for the assembly, transport, processing, and distri-
bution of agricultural products; and for irrigation and drainage facilities. At the general
overhead level, more capital is needed for roads, railroads, harbor facilities, electric
power and telephone systems, printing presses, hospitals and medical facilities, and
educational and research facilities.

The amounts of additional capital now needed for these investments cannot be easily
estimated, but the sums are knownto be large relative to the additions made to the capital
stock of these countries within the last decade (table 58).







Table 58.--Annual gross farm capital formation in specified study countries,
1950 and 1960

Gross farm capital formation Gross capital
formation as
Country Total Per hectare of percentage of
arable land value of agri-
cultural output,
1950 1960 1950 1960 19601


Million U.S. dollars U.S. dollars Percent

Israel ............... 63 95 217 2 244 42
Sudan................ 5 33 4 11 6
Philippines.......... 25 24 6 4 2
Yugoslavia ........... 70 393 9 47 33
Taiwan............... 37 48 45 55 11
Venezuela ............ 135 217 52 88 40
Thailand............. 50 81 5 8 8
Greece............... 14 109 4 30 14
India................ 437 2,156 3 13 15
Japan ................ 529 787 104 2 129 16
UAR .................. 42 117 18 47 10
Pakistan............. 58 150 2 6 5


1 Gross national product originating in agriculture.
2 Capital formation per hectare of agricultural land was $87 in Israel and $112 in
Japan.

Sources: National Statistical Abstracts, FAO questionnaires to respective governments,
National Bank Statement, U.N. Yearbook, National Account Statistics.

Ways of Mobilizing More Capital For Agriculture

,Underdeveloped countries can mobilize additional capital to invest in agriculture
by one or both of two ways: (1) by internal savings out of current production and incomes,
and (2) by diversion of capital from other uses and sources.
Internal savings can be made voluntarily by individuals, families, business firms,
or other agencies. Or they can be made through forced saving techniques, that is, through
new tax levies or credit expansion for capital expenditures sufficient to increase prices
and to force reduced consumption of other goods and services. Under the assumption
of full employment of resources, an increased rate of savings is possible only by reducing
consumption expenditures, whether savings are made voluntarily or are forced. Under-
employed and unemployed resources, however, provide a potential base for savings
and new capital formation that does not require curtailing output and consumption of other
goods and services.
The potentials for savings out of incomes at current levels are relatively low in
most of the study countries simply because of their low level of income relative to
living needs. Most of the study countries, however, probably have a larger capacity
for savings and new capital formation than their per capital incomes and past rates
of capital accumulation indicate. For example, even lower income families in many
underdeveloped areas of the world use a relativelylarge part of their income to purchase
jewelry or for ceremonial uses (Firth andYamey, 13). Furthermore, many underdeveloped
countries have extremely unequal income distribution; hence, in some cases, small
proportions of the population receive very large incomes.
Rents or income from land constitutes a major part of the income of many of the
larger income recipients, especially in countries characterized by large concentrations







of landownership, as in much of Latin America and the Middle East. Historically, land
income has often been used for support of conspicuously high levels of consumption
rather than for new capital formation (Lewis, 33). Yet, through a combination of land
tenure and tax reforms, Japan and Taiwan have been able to draw off a large part of
such land income for the financing of needed capital improvements (Ogura, 4). Tax sys-
tems of most of the other study countries with large concentrations of landownership
do not encourage reinvestment of land income.
Whether underemployed resources provide an important base for new capital
formation in agriculture and its related infrastructures depends upon how much under-
employed resources the study countries have, upon availability of the factors needed
as complements of the underemployed resources--including entrepreneurship and organi-
zational resources without which now idle labor and land are of little economic worth.
Some observers doubt that underdeveloped countries have enough underemployed
resources, especially labor, to serve as a significant basis for new capital formation.
These doubts have originated from the belief that marginal productivity of labor is posi-
tive (Viner, 68). Several of the study countries, however, do have relatively large amounts
of unemployment. There are also large seasonal variations in the amount of work per-
formed in the agriculture of most underdeveloped countries. This latter fact suggests
the presence of more labor potential in off-peak labor seasons than is actually employed.
In the United States, throughout most of the 19th century, such labor was frequently
employed to build up farm and rural area resources. Examples of comparable patterns
of new capital formation with labor that would otherwise have produced very little
can probably be found in most of the study countries. For example, using rupees paid
for food under the P.L. 480 program, a rural works program has been devised whereby
unemployed rural people in East Pakistan and millions of landless people in the Bengal
area have been put to work building farm-to-market roads and irrigation works (Harrison,
25, p. A 16).
Actually, as an economic concept full employment has a meaning that is highly
relative to price and income levels, and above all else to the values that a nation's
people place on economic goals. Through increased awareness of their possibilities,
most people--in less-developed and economically advanced nations alike--can work
much more effectively than they are accustomed to doing.
Capital can be diverted from hoards, from other production uses, and from foreign
sources, as through grants, loans, and investments by foreign entrepreneurs.
Peasant societies have various methods of hoarding wealth. The magnitude of such
hoards and their importance in underdeveloped countries cannot, of course, be determined
from available information. It can safely be assumed that diversion of sizeable amounts
of capital from other production uses to investments in agriculture is not very important
in the study countries. By and large, the study countries will have to depend upon their
own savings for much of the capital they need to increase their agricultural productivity.
During recent years, these have been supplemented by foreign grants and loans under
programs of technical and financial assistance, andbyinvestments of industrial and trade
organizations from economically advanced nations. Foreign corporations, for example,
have made some investments in plants producing fertilizers and other production requi-
sites in a few of the study countries, thereby providing international transfers not only
of capital but also of entrepreneurial ability.

Credit Facilities and Practices

Kinds of Credit Agencies
In most societies, decisions to save and to invest are made by different persons.
In such cases, it is mainly through credit transactions that savings are made available
to investors. The agency and mechanism through which savings are made available to
investors may be very simple or very elaborate, often depending upon the country's stage
of economic development. At one extreme, savings can be made available to investors
directly by savers without intermediary agencies, or at the other extreme, through
large-scale banking and credit systems, including those operated by the state.







of landownership, as in much of Latin America and the Middle East. Historically, land
income has often been used for support of conspicuously high levels of consumption
rather than for new capital formation (Lewis, 33). Yet, through a combination of land
tenure and tax reforms, Japan and Taiwan have been able to draw off a large part of
such land income for the financing of needed capital improvements (Ogura, 4). Tax sys-
tems of most of the other study countries with large concentrations of landownership
do not encourage reinvestment of land income.
Whether underemployed resources provide an important base for new capital
formation in agriculture and its related infrastructures depends upon how much under-
employed resources the study countries have, upon availability of the factors needed
as complements of the underemployed resources--including entrepreneurship and organi-
zational resources without which now idle labor and land are of little economic worth.
Some observers doubt that underdeveloped countries have enough underemployed
resources, especially labor, to serve as a significant basis for new capital formation.
These doubts have originated from the belief that marginal productivity of labor is posi-
tive (Viner, 68). Several of the study countries, however, do have relatively large amounts
of unemployment. There are also large seasonal variations in the amount of work per-
formed in the agriculture of most underdeveloped countries. This latter fact suggests
the presence of more labor potential in off-peak labor seasons than is actually employed.
In the United States, throughout most of the 19th century, such labor was frequently
employed to build up farm and rural area resources. Examples of comparable patterns
of new capital formation with labor that would otherwise have produced very little
can probably be found in most of the study countries. For example, using rupees paid
for food under the P.L. 480 program, a rural works program has been devised whereby
unemployed rural people in East Pakistan and millions of landless people in the Bengal
area have been put to work building farm-to-market roads and irrigation works (Harrison,
25, p. A 16).
Actually, as an economic concept full employment has a meaning that is highly
relative to price and income levels, and above all else to the values that a nation's
people place on economic goals. Through increased awareness of their possibilities,
most people--in less-developed and economically advanced nations alike--can work
much more effectively than they are accustomed to doing.
Capital can be diverted from hoards, from other production uses, and from foreign
sources, as through grants, loans, and investments by foreign entrepreneurs.
Peasant societies have various methods of hoarding wealth. The magnitude of such
hoards and their importance in underdeveloped countries cannot, of course, be determined
from available information. It can safely be assumed that diversion of sizeable amounts
of capital from other production uses to investments in agriculture is not very important
in the study countries. By and large, the study countries will have to depend upon their
own savings for much of the capital they need to increase their agricultural productivity.
During recent years, these have been supplemented by foreign grants and loans under
programs of technical and financial assistance, andbyinvestments of industrial and trade
organizations from economically advanced nations. Foreign corporations, for example,
have made some investments in plants producing fertilizers and other production requi-
sites in a few of the study countries, thereby providing international transfers not only
of capital but also of entrepreneurial ability.

Credit Facilities and Practices

Kinds of Credit Agencies
In most societies, decisions to save and to invest are made by different persons.
In such cases, it is mainly through credit transactions that savings are made available
to investors. The agency and mechanism through which savings are made available to
investors may be very simple or very elaborate, often depending upon the country's stage
of economic development. At one extreme, savings can be made available to investors
directly by savers without intermediary agencies, or at the other extreme, through
large-scale banking and credit systems, including those operated by the state.




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