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Productivity Change and Grain Farm Practice on the Canadian Prairie, 1900–1930

Published online by Cambridge University Press:  11 May 2010

Trevor J. O. Dick
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Abstract

This study constructs indexes of productivity change to show that the yield of prairie farm land fell, in some cases as much as 25 percent, while the productivity of non-land inputs rose 300 percent or more from 1900 to 1930. It was this latter productivity growth, rather than the supply of prairie wheat land emphasized by the “staples approach” to Canadian economic history, that made the western prairie profitable to farm, and that contributed most to expanding the supply of prairie wheat. Much of the post-World War I expansion of settlement was on the drier and relatively low yielding parts of the Canadian prairie.

Type
Papers Presented at the Thirty-Ninth Annual Meeting of the Economic History Association
Information
The Journal of Economic History , Volume 40 , Issue 1 , March 1980 , pp. 105 - 110
Copyright
Copyright © The Economic History Association 1980

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References

1 See Easterbrook, William T. and Aitken, Hugh G. J., Canadian Economic History (Toronto, 1956)Google Scholar, chap. 20, and Fowke, Vernon D., The National Policy and the Wheat Economy (Toronto, 1957)Google Scholar.

2 For the market view, see Trevor J. O. Dick, “Canadian Wheat Production and Trade, 1896—1930,” Explorations in Economic History, forthcoming 1980, and Norrie, Kenneth H., “The Rate of Settlement of the Canadian Prairies, 1870–1911,” this Journal, 35 (June 1975), 410–27Google Scholar. For a mixed view, see Marr, William and Percy, Michael, “Government and the Rate of Canadian Prairie Settlement,” Canadian Journal of Economics, 11 (Nov. 1978), 757–67Google Scholar. For a pessimistic view of the role of government, see Dales, John H., The Protective Tariff in Canada's Development (Toronto, 1966)Google Scholar.

3 Superficial attention is paid to the topic in Mackintosh, William A., Economic Problems of the Prairie Provinces (Toronto, 1935), pp. 16–19Google Scholar.

4 See Chambers, Edward J. and Gordon, Donald F., “Primary Products and Economic Growth: An Empirical Measurement,” Journal of Political Economy, 74 (Aug. 1966), 315–22CrossRefGoogle Scholar.

5 For accounts of these changes, see Spector, David, Field Agriculture in the Canadian Prairie West, 1870–1940, with Emphasis on the Period 1870–1920 (Ottawa, 1977)Google Scholar, Stewart, Andrew, The Economy of Machine Production in Agriculture (Toronto, 1932)Google Scholar, and Symes, Oliver L., The Evolution of Tillage Practices on the Prairies (Saskatoon, 1978)Google Scholar.

6 See, for example, Parker, William N. and Klein, Judith L. V., “Productivity Growth in Grain Production in the United States, 1840–60 and 1900–10,” Output, Employment and Productivity in the United States after 1800, Studies in Income and Wealth, vol. 30 (New York, 1966), pp. 523–28Google Scholar.

7 Some idea of this variety is given by Hopkins, Edward J., Armstrong, J. Morris, and Mitchell, H. D., Cost of Producing Farm Crops in the Prairie Provinces (Ottawa, 1935), p 32fGoogle Scholar.

8 In this form, T and combined L and K are considered weakly separable and complementary. This is analogous to a case discussed by Denny, Michael and May, J. Douglas in their “Homotheticity and Real Value-Added in Canadian Manufacturing,” in Fuss, Melvynand McFadden, Daniel, Production Economics: A Dual Approach to Theory and Application, vol. 2 (New York, 1978), pp. 55–56Google Scholar.

9 From (1) it follows that PQ = tT + wL + iK or PQ = P1Q1, + wL + iK where tT = P1Q1. Hence, P1 =(PQ/Q1) − (wL + iK)/Q1. Since Q = Q1 at the cost minimizing point, then P1 = P − (wL + iK)/Q. By a similar derivation where wL + iK = P2Q2, it follows that P2 = P − (tT/Q), and therefore, P = P1 + P2.

10 Annual yield data are also available by crop district, but because of changing boundaries and other gaps in the data, it was not possible to construct a meaningful time series of productivity measures for subprovincial geographic units. See Annual Reports of the Manitoba, Saskatchewan, and Alberta Departments of Agriculture, 1898–1932.

11 See Department of Labour, Wages and Hours of Labour in Canada, various years starting with 1920.

12 A rental rate based on this principle was calculated for 1910 in Lewis, Frank, “The Canadian Wheat Boom and Per Capita Income: New Estimates,” Journal of Political Economy, 83 (Dec. 1975), 1256Google Scholar. Figures for other years were extrapolated using the yield on a standard government bond; see Neufeld, Edward P., The Financial System of Canada, Its Growth and Development (New York, 1972), pp. 562–66Google Scholar.

13 These prices are reported in Canada, Canada Year Book (Ottawa, 1930), p. 964Google ScholarPubMed. To obtain a rental price, the rate described in note 12 was applied to the reported prices per acre.

14 See Lerohl, Melvin L. and MacEachern, Gordon A., “Factor Shares in Agriculture: The Canada-U.S. Experience,” Canadian Journal of Agricultural Economics, 15 (Feb. 1967), 9CrossRefGoogle Scholar.

15 See Dominion Bureau of Statistics, Handbook of Agricultural Statistics, Part I: Field Crops, 1908–1958 (Ottawa, 1959)Google Scholar. Earlier years were extrapolated using Fort William and Toronto prices.

16 See the discussion of relative costs provided by Grest, E.G. in An Economic Analysis of Farm Power in Alberta and Saskatchewan (Ottawa, 1935)Google Scholar.

17 It has been suggested that the peculiar conditions of dry land farming leave rather narrow scope for technical advance, particularly when acreage is expanded rapidly. See Bennett, Merrill K., “Trends of Yield in Major Wheat Regions Since 1885, Part II: Irregular, Stable, and Declining Trends,” Wheat Studies, 14 (March 1938), 238Google Scholar. Declining yields were also a feature of the spring wheat region of the U.S., yet the productivity of agricultural labor rose by several hundred percent. See Parker and Klein, “Productivity Growth,” p. 533.

18 See Chambers and Gordon, “Primary Products,” p. 328. Their rent estimate has been widely discussed, and in some cases raised, but never to account for as much as half contemporaneous growth in per capita income. See, for example, Caves, Richard E., “Export-Led Growth and the New Economic History,” in Bhagwati, Jagdish N., ed., Trade, Balance of Payments and Growth (Amsterdam, 1971), pp. 403–42Google Scholar.