From what has been said it will readily be understood that, inasmuch as nature is stingy and has seen fit not to distribute her bounties everywhere alike, the productivity of land varies from one piece to another. That this statement is true, can be verified on every hand. One plot of ground produces more wheat than another of the same size on which an equal amount of labor and capital has been expended. Similarly, one building lot yields more utilities than another; and one mine is more cheaply worked than another. In the first case, the most important factor, though by no means the only one, is fertility; in the second it is location; and in the third it is depth of shaft and thickness of vein. But in any of the three cases nature has contributed in varying degrees of effectiveness, thereby causing differences in the costs of production.

Our more general experiences in varying costs of production are with agriculture. One farmer cultivates soil especially adapted to corn-growing. Another farmer, on land less fertile, labors just as hard and employs an equal amount of capital. Yet he gets smaller returns. Still another farmer, on the poorest land, which we shall, in anticipation, call no-rent land, grows exactly enough corn to repay him for his employment of labor and capital. Obviously, the first farmer enjoys a relatively large return over and above his costs of production; the second one, a fair return; while the farmer on the no-rent land gets no such return. Thus, other factors in fixing the costs of growing corn, such as location, skill in farming, improvement in the arts, remaining the same, the unequal contribution of natural resources in the form of fertility, climate, and rainfall causes a corresponding difference in costs of production to corn-growers.

Copyright Underwood & Underwood, .V. Y.

A Modern Method of Harvesting Corn.

Scarcely less important in causing varying costs of production in growing corn, or any other agricultural crop, is location. Our farmer who cultivates the best land might lose the advantage coming to him from the use of the most fertile soil, if his farm were located in some region remote from transportation facilities; that is, his gain from fertile soil might be offset by his loss through costly transportation. For that very reason farm lands situated near markets or at least near good transportation lines, rail or water, ordinarily command higher prices and higher rents than would be the case if less advantageously located.

Concrete examples of varying costs of production in agriculture due to the unequal distribution of the gifts of nature or to differences in costs of transportation are easily found in the United States. New England farmers, as a class, have less fertile soil than Iowa farmers. Hence, their cost of producing a bushel of corn is higher than it is in Iowa. Also in Iowa two pieces of land of the same fertility may show differences in unit-cost of production owing to the superior location of one or the other in respect to transportation.

In the use of any other form of land - city lots, mines, waterfalls - similar differences arise. Two merchants of equal ability, with stocks of goods exactly alike, will carry on their respective businesses at different costs of production if the two pieces of land which they utilize are not similarly situated as to the passing crowds. Likewise, the owners of mines find differences in costs of production owing to the depth of the ores, and the location of the mines. Everywhere in the use of land these differences appear, causing differences in costs of production.

Because of the important place which land holds in production we can well afford to spend the time necessary to make a hurried survey of the natural resources of our own country.