Masters Theses

Date of Award


Degree Type


Degree Name

Master of Science


Agricultural Economics

Major Professor

Luther H. Keller

Committee Members

Charles L. Cleland, B. D. Raskopf


The striking characteristic of farms in the underdeveloped countries is their variability. Considerable variations exist between farms in Africa, Latin America, and Asia; they even vary between and within regions in the same country. Nevertheless, farm situations in the low-income countries may be generalized to a certain degree. One Outstanding feature is that "peasant farms" or "smallholders" 1 dominate. These consist of small farms organized on a family unit basis.2

Wickizer3 defined peasant type farming as:

. . . all farms of small scale agriculture in tropical countries from the primitive type of shifting cultivation to the more intensive culture as exemplified by rice growing in a number of Asiatic regions. The measuring of small holdings is relative. The number of acres held or cultivated by the tropical farmer is not a reliable guide to classification. . . .In addition, he argued that the apparent lack of efficiency of these type farms was due to the fact that:

1For the purpose of this study, a smallholder is defined as a farm that is in a contiguous or noncontiguous unit and the total acreage owned is less than 100 acres. This is the traditional definition of a smallholder in Malaya. Areas of 100 acres and larger are defined asa plantation.2

John W. Mellor, The Economics of Agriculture Development (Ithaca,New York: Cornell University Press, 1966), pp. 133-34.

3V. D. Wickizer, "The Smallholder in Tropical Export Crop Production," Food Research InstItute Studies, 1:49, February, 1960.. .... .

his holdings are too small or too scattered, or his right to use the land he farms is poorly defined. Formidable Through his handicaps are, the smallholder exists by themillions, and often thrives.In terms of land area, farm size tends to be small in peasant agriculture. Labor force per farm, however, tends to be as large or larger than in high income countries. Land and capital resources are scarce that the level of production, and hence, net income tends to below.4

In general then, the small size farms in peasant agriculture can be characterized by a large number of individual units. Farm size has been determined by the institutional organization of agriculture and by the man-land ratio. Over the years, the natural increase in population has led to decreases in the size of the holdings.

Subdivision and fragmentation of lands occur under various tenure systems, but have been more frequent in countries where the inheritance laws demand division of land. Islamic and Buddhist, and to some extentHindu^ laws demand the division of the deceased estates between the surviving heirs.5However, farm size is not a variable that can be easily manipulated. Changes in sizes of farms are associated with political.

4Mellor, op. cit., p. 134. 5Changes in Agriculture in 26 Developing Nations, 1948-1963,U.S.D.A. Foreign Agricultural Economic Report No. 27 (Washington:Government Printing Office, November, 1967), p., and economic repercussions. Land reform programs have encountered difficulties wherever undertaken.

Due to economies of size, some argue that concentration of agriculture on relatively large units will make it easier to increase total production. It is also argued that the typical smallholdings of the traditional agriculture need to be replaced by larger units, to take advantage of the possibility of mechanization, to make efficient use of scarce management resources and to overcome inefficiencies in resource use associated with fragmented holdings.7 Others believe that in most of the underdeveloped nations, surplus labor exists; consequently, their argument is that the problem becomes one of maximizing the value of output from a relatively fixed area of land, by using labor as effectively as possible combined with the other scarce inputs.8

The efficiency problem relating to farm size then is one of deciding the right quantities and right proportions to combine scarce resources to achieve low-cost expansion of farm production. Differences In the relative supplies and costs of factors between countries and even

6Kenneth L. Bachman, and Raymond P. Christensen, "The Economics Of Farm Size," in Herman Southworth and Bruce F. Johnson, AgriculturalDevelopment and Economic Growth (Ithaca, New York: Cornell UniversityPress, 1967), p. 255.7Ibid., pp. 234-35.

8S. E. Johnson and R. P. Christensen, "Efficient Use of Labor,Land, Capital for Agricultural Development of Densely Populated Areas,in U.S. Papers Presented for United Nations Conference on the Application of Science and Technology for the Benefit of the Less Developed Areas, Vol. 3 (Washington: Government Printing Office, February, 1963),p. 39.

within the country affect the factor proportions that are most economic and hence may influence the optimum farm size.9

Bachman and Christensen10 conclude that the appropriate sizefarms cannot be determined on an a priori basis. Farm sizes have to be evaluated in terms of the agricultural development problems and the economic situation in the country.

In Malaya as well as in the rest of Southeast Asia, an appreciable part of the rural economy is composed of smallholders. The Malayansmallholders may be placed in two broad groups. The first group consists of those farmers who are engaged in export-producing crops, mainly rubber;the second group includes the rice growing farmers, producing rice for home consumption. Coconut smallholders are also included in this second group

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