Export of Capital?

The financing by the United States of agricul tural expansion seems, at first sight, to present a policy dilemma, namely that a government with large agricultural surpluses on its hands is being asked to provide capital to increase foreign production of the very commodities in surplus supply. In the practice, the dilemma breaks down because of failure of the assumption that the expansion of agriculture in the underdeveloped countries has been hampered by the lack of physical capital from abroad. In fact, the principal limiting factors have been of a local institutional and social character. Against these obstacles, the advance of the agricultural pro duction needed for development has been actively promoted by the flow of United States capital to these countries.