Methods of Conducting Cost of Production and Farm Organization Studies

Excerpts from the Introduction: In 1902 the Minnesota Experiment Station began studies of the cost of production and of farm organization, which have been continued up to the present time. The Office of Farm Management, United States Department of Agriculture, began cost studies in 1906, and was closely followed by various State organizations. The economic changes caused by the World War accentuated the growing demand for facts concerning the business side of the farmers’ production of food. The complicated details involved in the farmer’s method of production and distribution make it inevitable that any hasty attempt to collect cost data will result in superficial, misleading, and usually inadequate information. There is no thorough understanding of the value and uses of cost of production data, and little material concerning methods of attacking the problem from its economic side is available. The purpose of this bulletin is to throw some light on the fundamental concepts of cost data and to describe methods of study and the uses to which the data may be put.