Thequalitativechangeinfertilizersconsumedismostinterestinglyillustratedinthemercializationofgreenmanure.Althoughtheuseofgreenmanureasfertilizerdecreasedasindicatedabove,theproductionofgreenmanurecropsdidnot.[7]Beforethesharerestriction,greenmanurecropswereseldomharvested,butwereplowedunderforfertilization.Undertherestriction,however,thedirectconsumptionofgreenmanuredeclined.Instead,partofthecropswerenowharvested,processedincakeform,andsoldinthemarketasmercialvegetablefertilizers.Besidesahigherprocessingcostandmoreeffectivenessinuse,anotherreasonmaybeofferedforthemarketingofgreenmanure.Theharvestingofthecropsreleasedthelandearlierforothercrops,aconditionessentialforthefastercroprotationintenantfarmsasimpliedbythehypothesisofincreasedfarmingintensity.
TheaforementionedchangesinfertilizerconsumptionconformwithareportprovidedbytheTaiwanProvincialLandBureauwhichindicatesthatthegreaterpartoftheincreaseintenantinewasinvestedinfarming.[8]Itwasreportedthat,in1950,39.8percentoftheincreaseintenantinewasspentonfertilizers,14.2percentondraftanimals,and12.8percentonfarmimplements.Asidefromhousing,health,andmiscellaneousexpenditures,whicharebothconsumptionandinvestmentspending,theincreaseinpureconsumptionasapercentageoftheincreaseintenantineincluded7.3percentinfoodandclothingand2.3percentinamusement.
[1].SeeShen,AgriculturalDevelopmentonTaiwan,pp.136-39,187-88andelsewhere.Theusualpracticewasthatfertilizersandseedswereprovidedbythetenants(housingwasusuallyprovidedbythelandowners).Thequalitativechangesinfertilizersrepresentedincreasingfarmingintensityandnotpensatingpayments.
[2].DAF,Yearbook1952,sec.5.C.Notethattheredidnotexistawell-establishedtrendtowardtheincreasinguseofmercialfertilizersbefore1948.Ignoringthewaryearsbefore1947,therewasadecreaseinmercialfertilizerconsumptionof4.5percentfrom1947to1948,andafterwardthetrendofincreasingmercialfertilizerconsumptionisclear.Weconsiderthesequalitativechangesinfertilizersconsumedasevidenceconfirmingthehypothesisofincreasedfarmingintensity,whichmustnotbeconfusedwithfurtherincreasesinmercialfertilizersafter1953,whentheirproductionwassubsidizedbythegovernment.SeeOfficeofEconomicPolicy,"TheTaiwanFertilizerIndustry,"p.3.
[3].DAF,Yearbook1952,sec.5.D.Inabosluteweight,whichdoesnotappeartobearelevantmeasure,thedecreaseinfarm-producedfertilizerswasslightlygreaterthantheincreaseinmercialfertilizers.
[4].Ibid.,sec.5.C.
[5].Shen,AgriculturalDevelopmentonTaiwan,pp.136-39,187-88.SeealsoOfficeofEconomicPolicy,"TheTaiwanFertilizerIndustry."
[6].DAF,Yearbook1952,sec.5.D.
[7].Ibid.,sec.3.V.
[8].TaiwanProvincialLandBureau,"Implementationofthe37.5percentFarmRentLimitationProgram,"mimeographed(1950),pp.37-38.Thereportwaspiledfromquestionnairesansweredbytenants,theaccuracyofwhichisquestionable.Variousestimatesoftheaverageincreaseintenantineareavailableinmanysources,butallareputedsimplybyusinganarbitraryconstantasameasureoftheincreaseinthetenant'sine.Theyareoverstatementsforpoliticalpropagandapurposes.
C.Conclusions
Admittedly,thedatapresentedinthischapterareinadequate.Withrespecttoreallocationoflaborresources,informationislackingonhowthefarmingpopulationdatawerepiled.Onemayquestionwhetherfarmingpopulationisacorrectmeasureofactualworkingunits.Variousreportsindicatingthattenantsworkedlongerhoursunderthesharerestrictionarebasedononlyafewsamples.Thesignificantreductionintenantlandholdings,however,rendersstrongerevidence.Withrespecttoadjustmentsinfertilizerinputs,welackinformationonwhethertheincreasesinfertilizerexpendituresoccurredprimarilyintenantfarms.Onemayconclude,however,thatavailableevidencerelatedtoresourcereallocationisconsistentwiththeimplicationsofthehypothesisofincreasedfarmingintensity,andIcouldfindnoevidencewhichisinconsistentwithmyhypothesis.Reinforcingevidenceisavailablewhenweinvestigatethebehaviorofvariouscropyieldsinthenextchapter.
ButtheincreaseintenantinputintensityunderthesharerestrictioninTaiwanhasbeenregardedbyreformofficialsandTaiwaneconomistsas"significant."Severalhypotheseshavebeenadvancedtoexplainthisobservation.Thesehypotheseshavetwothemesinmon.[1]Acceptingtheevidenceoninputadjustmentsaspresented,wemaydismisstheargumentswithwhichTaiwanreformofficialshaveclaimed"success."
Theirfirstlineofargumentrestsontheassertionthattenantcultivationhadbeeninefficientinitially,andthatthesharerestrictionledtomoreefficientlanduse.Undersharetenancy,theyargue,thetenant'sincentivetofarmisreduced,sincepartoftheoutputistakenawaybythelandowner.Accordingtothisthesis,tenantinputsmittedtolandhadbeen"insufficient"underafreemarket,withthemarginalproductsoftenantinputshigherthanthemarginalcosts,sothatthereducedrentalpercentageencouragedgreatertenantinputs.Indeed,thisargumentimpliesthataslongastherentalpercentageisgreaterthanzero,inputsmittedintenantfarmswillneverbeashighasinownerfarms.Accordingtomytheory,however,resourceuseinownerfarmsandintenantfarmsisequallyefficientunderunrestrainedprivatepropertyrights.Underthesharerestriction,thehypothesisofincreasedfarmingintensityimplies"excessive"resourcesallocatedtotenantfarms.Which,then,istheusefulhypothesis?