Title Farm size and Productivity - includes earlier part too.pdf ✅

1 (35) , I ( I 1 I CHAPTER Farm size-Productivity Relationship: The Ongoing Debate 2. 1 Introduction 2.2 Farm-size and Productivity 2.3 Summary of a Debate 2.4 Need of the Study 2.5 Stylised Facts of Indian Agriculture • ,\===========
1 (36) CHAPTER - 2 FARM SIZE - PRODUCTIVITY RELATIONSHIP: THE ONGOING DEBATE 2.1 INTRODUCTION The relationship between farrr;foi ze and productivity is not very clear. Different economists hold different views . While some argue that, there is an inverse relationship in that productivity declines as tarm size increases, other economists have argued that as farm size increases, productivity increases while, some other economists argue that productivity is neutral as between farm sizes. There are also economists who feel that inverse relationship holds over "certain ranges of size" and not over "ali ranges of size". Thus, instead of ciear cut conclusions on the issue, what we have is a debate. This debate was initiated by A.K.Sen (1962,1964) with the conclusion that an inverse relationship existed between farm si7e and productivity in Indian agriculture, which is the principle hypotilesi3 of this present study, to be examined for Gujarat Agriculture. 2 1
1 (37) 2.2 FARMSIZE AND PRODUCTIVITY Du ring the pre HYV period, the ques:ion of farm size was usually raised in connection with the following three issues: 1. Th8 relative efficiency of farms of different size groups; efficiency being defined vdriou sly as : a. Productivity per unit of land , b. Productivity per unit of labour inputs, c . Net return per unit of capital employed; and d. Amount of su rplus marketed per un it of land. z 2. The concept of viable farm size which oplirni,jes the use of bullocks, the major indivisible input in pre-HYV agriculture, and the stock of family labour and provides the filmi ly with a subsistence income. 3. The issue of land reform i.e. to what extent a policy of redistributing land in favour of smaller peasants and landless labou rers would further the twin objectives of attaining social justice as well as improving the efficiency of Indian agricultu re. Apart from these issues for over two decades, economis ts
1 (38) - have been engaged in a debCltE on the relationship between farm size, productivity and farm efficiency. While farm productivity implies output per unit of land , farm efficiency or farm profitilbility refers to the surplus of the value of output over all costs (incl udi ng the imputed va lue of inputs contributed by the farmer or his family.) Since 1954-55, the studies in the economics of farm management undertaken by the Governrnent of India orovided a statistical base for the economists to work out the relationship between farm size on the one sid6 and pr0ductivity and efficiency on the other. The debate on farm size and productivity in India was initiated by A.K.Sen (1962) and was later on joined by A.M .Khusro (1964 ), AP. Rao (1967), Hanumantha Rao (1966, 1968), Ashok Rudra (1968) and others, but the controversy has remained largely inconclusive. Most of these studies observed an inverse relationship between farm size and output per hectare in the Farm Management Studies Sen(1962), Khusro (1964), Saini (1969) and • others] i.e. small farms in India were far more productive than I"'ge holdings because of intensive cul;ivation. One explanation for this relationship was offered in terms of the superior quality of land under smaller holdings; more fertile 13nd provides 9reater opportunities for earning income, so that the family size expands at a faster rate which leads to quicker sub-division of more fertile land over time [A.K.Sen;1964]. Thrs 23