Thehypothesesconstructedonthesepremisesareincorrect.First,toacceptthephenomenonofcrowdedfarmingassocialistoleaveaneconomicquestionunanswered.Second,theexistenceofunlimitedlaborsupplyorlabor"surplus"isanassertionwhichinfacthasnoempiricalfoundation.Third,itispresumptuoustosaythatthepeasantsareignorantoffarmingmethods,forpetitionwillinducesophistication.Itisfarclosertothetruthtosaythatitistheeconomictheoristwhodoesnotknow.Fourth,the"rock-bottom"issoftandvariable.Finally,lackinganexplicitbehavioralpostulate,theaverage-productargumentisinconsistentwithwealthmaximizationunderprivateownershipofresources.
Thetheoryofsharetenancyderivedinchapter2providesadifferentexplanationforhigherratiosoflabortolandinAsianagriculture:thepeasants'landholdingsaresmallbecausetheiralternativeearningsarelow.Andtheirlowearningsareduetothesmallareaofarablelandrelativetolaborforce,togetherwiththefactthatfarmingskillandknowledgearenothighlyvaluedinotherindustries.Underprivateownershipofland,itistothelandowner'sinterestthatnonegativemarginaleffortis"disguised."Giventheexistingresources,crowdedfarmingistheresultofwealthmaximization,notof"irrationality."
Itisnotdifficulttoshowthat"original"theoremsorhypothesesintendedtoexplainresourceallocationin"underdeveloped"agricultureareunnecessary.ForAsianagriculture,theaforementionedhypothesescanbereadilydismissedinlightofobservationsonlanduseandtheanalysts'neglectofthepertinentpropertyrightconstraints.
First,letustakeacloserlookattheso-calledovercrowdedfarminginAsia,which"overcrowding"cannotbedeniedbyWesternstandards:
Thegrowingseasonsofriceandcanecropsoverlap.Atthetimecaneshouldbeplanted,theprecedingricecropisnotyetripe.Thisproblemissolvedbyplantingcaneamongtheripeningriceplantsonemonthbeforethelatteraretobeharvested.Becausethedistancebetween[cane]rowsis1.39metersandbetween[cane]plants0.4meter,farmersoftenplantpeanuts,sweetpotatoes,cottonandsoybeansbetweentherowsofcanesinsummer.TheseinterplantedcropsareharvestedinNovemberorDecemberbeforethecanesgrowtall.[2]
Examplesasintricateasthisareabundant.[3]ButasJ.L.Buckpointsout:
ItisevidentfromthismazeofdetailontheactualuseoflandbycropsinChina,that,inspiteoftheintensiveuseofcropsforhumanutilizationdirectlyratherthanindirectlybyfirstproducinganimalproducts,stillgreaterproductioncouldbeobtained.[4]
WhileBuckisamazedbythevariousmethodsofintensivefarmingandsoilconservationinChina,theflexibilityoflanduseisfrequentlyignoredbydevelopmenteconomists.Anunimaginativetheorist,unfamiliarwiththeactualsituation,mighteasilyconsiderthecrowdedtillingwasteful,andhastilydevelopfancytheoremsandpoliciestoslaythedragon.
Evidencesuggeststhat,beforetheagrarianreformsinAsia,themarginalproductofagriculturallaborwasnotonlypositivebutalsonowherenearzero.TakeTaiwan,forexample,wherein1948thelandholdingperpersoninfarmingwasaboutassmallasonecouldfind.Aswasshowninchapters7and8,however,increasesinlaborandotherinputsontenantfarmsundertherentalsharerestrictionledtosignificantincreasesinoutputs.
Indeed,thefactthatmoncropsaregrownconfirmsthatthemarginalproductoflaborispositive.Thisissobecausethesamelandcanbeusedtocultivateothercrops,forexample,vegetables.Vegetablecropshaveconsiderablyhighermarketvaluesthanmoncrops,andtheygenerallyrequireeighttimesasmuchlabortocultivate.[5]Forgoingsomemoncropsforvegetableplantingwillleadtoincreasinglaborinput,andahighergrossine.YetonlyasmallportionofcultivatedfieldshasbeenusedforvegetablesinAsia.[6]
Zeromarginalproductivityoflaborimpliesaconditionwhereitisnolongerpossibletochooseamorelabor-intensivecroptoobtainahigherine,whichisrefutedbythefacts.Itfurtherimpliesthatthereexistsnoidlelandmarginorthatitisimpossibletoadoptafastercroprotationratewithincreasinglaborinputandine,whichisalsorefutedbythefacts.Itimplies,too,thatmostdryfieldsareconvertedintopaddyfieldsthroughtheuseoflabor.Andthelistofrefutingevidencegoeson.
Asecondreasonforrejectingthehypothesesofdisguisedunemploymentandthedualeconomyliesintheirneglectoftheexistingsystemofpropertyrights.Underprivateownershipofland,disguisedunemploymentcannotbederivedfromstandardeconomictheory,regardlessofhowcrowdedfarmingmaybe.Undermonownership,however,zeroornegativemarginalproductoflaborisconsistentwiththegeneralbodyofeconomictheory.[7]Thisissobecausepetitionamonguserswillreducetherentalvalueoflandtozero,thusequatingtheaverageproductoflaborwiththewagerate(oralternativeearning).
Supposethat,asdevelopmenteconomistshavetakenforgranted,empiricalevidencedidconfirmthatthemarginalproductoflaborislowerinagriculturethaninotherindustries.IftheirhypothesesareintendedtointerpretAsianexperienceinthepasttwentyyears,asmanyofthemare,thentheyarestillincorrect.Theyareincorrectbecauseprivatefarmlandownershipwithfreemarkets,conditionswhichtheirhypotheseshaveimplicitlypresupposed,havebeenrareinAsiasince1950.ThevariousagrarianreformsinAsia,aswasmentionedinchapter1,mayinfacthaveledto"dual"economies.Inparticular,asanalyzedinthesecondpartofthisstudy,therentalsharerestrictionyieldsaconditionwherethemarginalproductoflaborislowerintenantfarmsthanelsewhere.Thisresultisderivedentirelyfromstandardeconomictheory.