Differences in farm returns were analysed technically and economically. The study was of 29 arable farms of about 33 ha in the North-East-Polder in the area Lake IJssel. The farms there are very similar in size, soil, field layout and original farm building. The remarkable difference was in the farmers themselves. Each farmer made his own decisions, and differences in them were responsible for differences in annual returns up to 50 000 in 1968 and up to 110 000 in 1969.
The differences in returns were examined by factor analysis.
An approach from economic theory and from practical considerations (Chap. 2) demonstrated that previous studies based on farm accounts gave only a rough indication of causes, because of a lack of detailed technical information on the farms. It also showed that the farmer himself plays an important role and may even determine the farm returns.
The research was therefore based on two principles. First very detailed information was needed on differences in growth and development of crops and on environmental conditions on each farm. Second the search was concentrated on the relation between the differences in farmer's decisions and the corresponding differences, for instance, in physical yields per ha and in work organization.
The data were sampled in 1968/1969 and 1969/1970. The weather in both years was roughly the 'normal average'.
The analysis of the farm returns (Chap. 3) shows that in 1968 61% and in 1969 76% of the variance in net revenue per ha has a positive relationship with that of the gross returns per ha. In both years, there was a positive relationship of the net revenue per ha with the physical yields of ca 30-36% and with the product prices of 25-31% in 1968 and of 44% in 1969. The variance in cropping plan 'explained' in 1968 9% and in 1969 15% of the variance in net revenue per ha. The variance in the costs, especially of labour, was in 1968 connected with 17% of the variance in net revenue per ha. In the extremely good (prices!) year1969, no connection was found between costs and net revenue. Net returns were not so much related to factors characterizing farm organization (e.g. costs, cropping plan), but rather to factors in the day-to-day management. Thus the farmer was the determining factor in the circumstances of the farm.
For this first analysis, only farm accounts were used. Since very detailed technical information had been sampled differences could he analysed in work organization of each farm and in physical yield per ha of each of four crops winter wheat, sugar-beet, seed potatoes, and ware potatoes (Chap. 5).
For the whole group of farms, the variance in costs of work organization (labour, machinery, contract operators) showed only a slight relationship with farm return. Work organization formed a large part in the total costs of a farm so it was analysed in detail.
The efficiency of work organization was expressed in the operational costs per work unit (which are the real costs per farm of labour, machinery and contract operators related to standard costs). The operational costs per farm differed up to about f 20 000 (av. ca f 47 500). Four factors 'explain' about 95% of the variance in efficiency of work organization in both years. Two factors in long-term decisions characterize farm organization: (1) supply of labour in relation to an amount of manual work required, (2) amount of farm equipment in relation to a norm for machine use. They 'explain' 60-65% of the variance in operational costs per work unit. On most farms, too much labour and machinery were available for the work that had to he done. Two other factors in short-term decisions were the intensity of use of the labour supply and of the equipment. These 'explained' 30-35% of the variance in operational costs per work unit.
There was only a little difference in factor pattern between years of the differences in work organization.
Thus most of the farmers had difficulty in balancing work organization on their farm, especially in long-term decisions.
For the four crops the physical yields per ha differed in both years up to ca 1800 kg per ha for winter wheat (av. ca 5350 kg/ha), up to ca 18 000 kg per ha for sugar-beet (av. ca 60 000 kg/ha) and also up to ca 19 000 kg per ha for ware potatoes (av. ca 52 500 kg/ha) and even for seed potatoes (av. ca 32 000 kg/ha).
The analyses show that of each crop (Chap. 5) about 90% of the variance in physical yield per ha is 'explained' by 10 or 12 factors'. Of these 10 or 12 factors per crop there is a group of 8 or 10 factors occurring in both years. The pattern of factors was therefore similar between years. This group of 8 or 10 factors 'explains' ca 60-85% of the variance in physical yields of each crop.
In both years for each crop, the greatest part (ca 55- 90%) of the variance in physical yield per ha had already originated in the initial period of growth.
Most of the factors separated could be influenced directly by the farmer (e.g. sowing depth, N dressing). Some 'result' factors were separated too. They are the results of recent farmer's decisions and actions or of the field's 'history' (i.e. feed back processes in arable farming such as green manuring, damage to soil structure).
The factors separated for winter wheat concerned differences in tillage and cropping, and crop characteristics in the autumn and following spring; for both seed and ware potatoes, factors during sprouting, tillage and cropping in spring (e.g. preparation of seed tubers and seedbed); for sugar-beet factors concerned the decisions and actions in the sowing period (e.g. sowing depth, N dressing). Thus a great part of the variance in physical yield per ha could be ascribed to differences in the farmer's technical competence as expressed in their decisions and actions. The relationship of the farmer's competence with physical yields of his crops is suggested by the similarity of the groups of farmers that had high or low yields in the two Years.
A survey of the three elements of the learning process of the farmer -- knowledge, experience and discernment -- shows that the farmer's competence is based mainly on his capacity to think about the growth and development processes of the crops (Chap. 6). His ability to regulate crop-growth factors (average growth per day and length of the growing period) against the background of economic, technical and social conditions on and off the farm. The learning process of the farmer is not static. It does not end when he leaves school but is dynamic, continuing through his life as an entrepreneur. Further the critical points in the farmer's decision-making process were analysed, in particular the phases of observation, of assessment and of the final decision in the aspects of management examined in detail: work organization and crop growing. The farmer's role in these phases (establishing goals in relation to observation, assessing alternative strategies and chosing the best alternative) is described. This analysis indicates that the farmer's willingness to criticize his own decisions and actions and to continue learning are fundamental in keeping the enterprise profitable.
The analysis of data from the farms and analysis of the learning and decision-making process of the farmer provide elements for a reconsideration of the education and assistance offered to present and future farmers. Some proposals are made for developing and sharpening his ability to observe, assess and make decisions during school education, by visiting the best farmers, for instance, when the critical decisions have to be made in the field. In combination with theoretical lessons in school, the proposals should encourage the development of discernment to practical problems in the budding farmer. After leaving school periodic brief, but intensive, courses on topics concerning the farm itself and its part in the community could equip the modern farmer for his task. The farmer's competence in external management is emphasized, e.g. dealing with tax advisers, bookkeepers and farm cooperatives.
A proposal is made for finding the critical points in crop growing in order to provide more selective advice to the farmers. The same procedure can be followed as in this investigation and critical points can be detected in the crop growing methods of farmers in each region. This would provide a basis for the working plan of an advisory service. The importance of advice on these points lies in the improvement most farmers could make in input-output ratios of crops on their farms.
In the last section of Chap. 6, the entrepreneurship in a typical Dutch arable farming is analysed. After summarizing the analysis of all aspects of farm management, the conclusions remain as foreseen. Though other elements cannot be ignored, the farmer undoubtly needs to develop his ability at growing crops by taking account of the technical, economic and social conditions.