Crops, Costs And Variations

This study based on Farm Management Investigation conducted in India examines he extent and causes of inter-year as well as inter-regional variation in the cost of production of some major crops in India. It also highlights the changes in cost-structure and cost-price relationship with reference to technological change. The study also seeks to examine how far the regional cropping patterns are determinedon the basis of the principle of comparative advantage. It works out the indices of cost of production of individual crops in different regions and seeks to examine how far cost of production can serve as a basis of price-fixation. Enlarging flow of information has been carefully mustered, pooled and processed in the study leading to quite a few interesting observations. One would expect costs to vary over years and over regions since out years and over regions. The study suggests through analysis of variance, costs vary over regions but not over years if technology remains unchanged. Thus technological condition and resource based rather than seasonal factors influence costs prominently. The study observe also the instances where unit-cost of crop-output on irrigated land exceeds that on unirrigated land. This is an interesting and an exceptional observation. The study by Green Revolution. The study observes that market prices and production costs are not particularly related. The study recognizes that even in the case of administered prices, cost of production can only be one of the factors and there can be no mechanical formula approach to the fixation of support/ procurement prices. The study strives also show that for a farmer in a given agro-climatic, technological and economic setup, what is relevant in the relative profitability of different crops of crop-combinations which can be grown in that region alongwith resource endowment and not the comparison of relative profitability of crops across the regions.