6.Let us seek a graphical illustration.{Figure 11} It is to be remembered that graphical illustrations are not proofs.They are merely pictures corresponding very roughly to the main conditions of certain real problems.They obtain clearness of outline, by leaving out of account many considerations which vary from one practical problem to another, and of which the farmer must take full account in his own special case.If on any given field there were expended a capital of ?0, a certain amount of produce would be raised from it: a certain amount larger than the former would be raised if there were expended on it a capital of ?1.The difference between these two amounts may be regarded as the produce due to the fifty-first pound; and if we suppose the capital to be applied in successive doses of ? each we may speak of this difference as the produce due to the fifty-first dose.
Let the doses be represented in order by successive equal divisions of the line OD.Let there now be drawn from the division of this line representing the fifty-first dose M, a line MP at right angles to OD, in thickness equal to the length of one of the divisions, and such that its length represents the amount of the produce due to the fifty-first dose.Suppose this done for each separate division up to that corresponding to the last dose which it is found profitable to put on the land.Let this last dose be the 110th at D, and DC the corresponding return that only just remunerates the farmer.The extremities of such lines will lie on a curve APC.The gross produce will be represented by the sum of these lines: i.e., since the thickness of each line is equal to the length of the division on which it stands, by the area ODCA.Let CGH be drawn parallel to DO, cutting PM in G; then MG is equal to CD; and since DC just remunerates the farmer for one dose, MG will just remunerate him for another: and so for all the portions of the thick vertical lines cut off between OD and HC.Therefore the sum of these, that is, the area ODCH, represents the share of the produce that is required to remunerate him; while the remainder, AHGCPA, is the surplus produce, which under certain conditions becomes the rent.
7.That is, we may substitute (fig.11) the dotted line BA' for BA and regard A' BPC as the typical curve for the return to capital and labour applied in English agriculture.No doubt crops of wheat and some other annuals cannot be raised at all without some considerable labour.But natural grasses which sow themselves will yield a good return of rough cattle to scarcely any labour.
It has already been noticed (Book iii, ch.iii, 1), the law of diminishing return bears a close analogy to the law of demand.
The return which land gives to a dose of capital and labour may be regarded as the price which land offers for that dose.Land's return to capital and labour is, so to speak, her effective demand for them: her return to any dose is her demand price for that dose, and the list of returns that she will give to successive doses may thus be regarded as her demand schedule: but to avoid confusion we shall call it her "Return Schedule."Corresponding to the case of the land in the text is that of a man who may be willing to pay a larger proportionate price for a paper that would cover the whole of the walls of his room than for one that would go only half way; and then his demand schedule would at one stage show an increase and not a diminution of demand price for an increased quantity.But in the aggregate demand of many individuals these unevennesses destroy one another; so that the aggregate demand schedule of a group of people always shows the demand price as falling steadily with every increase in the amount offered.In the same way, by grouping together many pieces of land we might obtain a return schedule that would show a constant diminution for every increase of capital and labour applied.But it is more easy to ascertain, and in some ways more important to take note of, the variations of individual demand in the case of plots of land than in the case of people.And therefore our typical return schedule is not drawn out so as to show as even and uniform a diminution of return as our typical demand schedule does of demand price.
