A Note on the Davis Review of "Agriculture in an Unstable Economy"

Abstract

THE admirable review article by Joseph S. Davis sets a high standard in workmanship. The review is many sided, meticulous, and on many specific points penetrating. Davis concurs in many of the lesser findings put forward in the book, but he is obviously much disturbed by the two main theses that emerge. He cannot accept the conclusion that a persistent excess supply of labor, with the attendant low per capita earnings, characterizes agriculture in the long run. Nor is he willing to take the cyclical instability of farm income associated with business fluctuations and treat it as part of the general problem of maintaining the aggregate demand by means of monetary-fiscal measures that are countercyclical in nature. Davis' dissent, therefore, is not with regard to details but on fundamentals. The basic differences between his approach and that underlying Agriculture in an Unstable Economy go much deeper than his liberal praise of the book might indicate. They are rooted partly in economic theory, partly in the empirical evidence considered relevant, and partly in concealed valuations. These analytical differences can best be made explicit by focusing first on the idea of equilibrium and second on fluctuations.