Summary Ag. Econ. 6.4 (2+1) Farm Management, Production and Resource Economics
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Course
AGRICULTURAL ECONOMICS
Institution
AGRICULTURAL ECONOMICS
Production economics
Introduction, Objectives, Scope, Subject Matter, Basic terms & Concepts
1-5
2.
Law of returns
Law of variable proportions, Types of returns and estimation
6-9
3.
Seven cost concepts
Meaning and Concept of Cost, types of costs and their relationships
10-22
4.
Factor-...
Ag. Econ. 6.4 (2+1)
Farm Management, Production and
Resource Economics
Dr. K. P. Thakar
Dinesh D. Chaudhari
Department of Agril. Economics,
C. P. College of Agriculture,
Sardarkrushinagar Dantiwada
Agricultural University,
Sardarkrushinagar
, CONTENTS
No. Title Sub-topics Page No.
Introduction, Objectives, Scope, Subject
1. Production economics 1-5
Matter, Basic terms & Concepts
Law of variable proportions, Types of returns
2. Law of returns 6-9
and estimation
Meaning and Concept of Cost, types of costs
3. Seven cost concepts 10-22
and their relationships
4. Factor-Product relationship Optimal input and output levels 23-27
5. Factor-Factor relationship Isoquant, iso-cost line, least cost combination 28-33
Production possibility curve, isorevenue line,
Product-Product
6. Optimal product combination, ridge line and 34-39
relationship
expansion path
7. Returns to scale Concept and Types 40-41
Importance of cost in managing farm business,
Farm cost concepts and Estimation of gross farm income, net farm
8. 42-43
Income measures income, family labor income and farm
business income
Introduction, Meaning & Concept, Objectives,
9. Farm management 44-45
Scope, Relationship with other sciences
Meaning and Definition of Farm, its types and
Farm resource
10. characteristics, factors determining types and 46-49
management
size of farms
Farm management Strategic, administrative and marketing
11. 50-52
decisions decisions
Economic principles
Equi-marginal, opportunity cost, time
12. applicable in farm 53-56
comparison principles, comparative advantage
management
Advantages, characteristics, difficulties,
13. Farm records and accounts 57-65
systems & types
14. Farm inventory Methods of valuation 66-69
Balance sheet, Cash flow statement and Profit
15. Farm financial statements 70-78
& loss Statement
16. Farm planning Types, characteristics, steps 79-81
Complete budget,
17. Farm budgeting Enterprise budget, 82-84
Partial budget
Measures of efficiency of land, labour, capital
18. Appraisal of farm resources 85-88
and management
Risk & Uncertainty in
19. Types and management strategies 89-92
agriculture
Crop, livestock, machinery and weather-based
20. Insurance in agriculture crop insurances, Features and Determinants of 93-99
compensation
, Natural resource classification &
Resource Economics:
21. characteristics; Management of renewable 100-105
Concept & Properties
and non-renewable resources
Positive & Negative Externalities & types; Market failure, Market
22. 106-108
Externalities in agriculture imperfections; Policies for externalities
Efficiency and types; Market efficiency levels;
Inefficiencies and welfare
23. Reasons for inefficiency in resource utilization; 109
loss
Solutions
Issues in economics and
Major issues in use of natural resources,
24. management of Common 110-115
Productivity equity, sustainability
property resources
REFERENCE BOOKS
No. Name of Book Author(s)
S. Subba Reddy
P. Raghu Ram
1 Agricultural Economics
T. V. Neelkanta Sastry
I. Bhavani Devi
S. Subba Reddy
2 Agricultural Finance and Management
P. Raghu Ram
S. S. Johl
3 Fundamentals of farm Business Management
T. R. Kapur
S. P. Dhondyal
4 Production Economics & Farm Management
G. N. Singh
V.T. Raju,
5 Economics of Farm Production and Management
D.V.S. Rao
, Chapter 1
PRODUCTION ECONOMICS:
MEANING
• Agricultural Production Economics is a division of Agricultural Economics.
• It is concerned with the selection of production patterns and resource use
efficiency in order to maximize the objective function of a farmer or farming
community or the nation within a framework of limited resources.
DEFINITION
Agricultural Production Economics is an applied field of science wherein the
principles of choice are applied to the use of land, labour, capital and management
resources in the farming industry.
SUBJECT MATTER
Agricultural Production Economics involves:
• Analysis of production relationships
• Principles of rational decisions.
• Productivity of resources
• Resource use efficiency
• Resource combination
• Resource allocation
• Resource management
The subject matter of production economics involves topics like factor-product
relationship, factor-factor relationship, product-product relationship, size of the farm,
returns to scale, credit, risk and uncertainty, etc.
The agricultural production economics is therefore concerned with any phenomena,
which have a bearing on economic efficiency in the use of resources. Any Agricultural
problem that falls under the scope of resource allocation and marginal productivity
analysis is the subject matter of Agricultural Production Economics.
GOAL
• At an individual farm level: To provide guidance to individual farmers in using their
resources most efficiently.
• At national level: To rationalize the use of resources from the standpoint of
economy.
OBJECTIVES OR IMPORTANCE
The main objectives of Agricultural Production Economics are:
• To determine the conditions which provide for optimum use of resources.
• To determine the extent to which the existing use of resources deviates from the
optimum use.
1
Dr. K. P. Thakar Dinesh D. Chaudhari
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