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I'm not sure how much additional cost savings you get once the farms are about a square mile in size. The limiting factor on mechanization is the amount of ground that a combine harvester can cover during the acceptable harvesting window. Beyond that, you need additional equipment and people at the same rate.

My sources say that beyond that point, what is being done is shortcuts that result in less efficiency. Unskilled workers don't optimize the irrigation system and treat the capital equipment poorly, so the savings in lower wages are cancelled out by less production...

by asdf on Mon Jun 25th, 2012 at 10:27:49 AM EST
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Bargaining power? Cheaper logistics to bring production to the market? Ability to vertically integrate (producing cheese, spirits...)?

That's on top of my head. I'm no expert.

Earth provides enough to satisfy every man's need, but not every man's greed. Gandhi

by Cyrille (cyrillev domain yahoo.fr) on Mon Jun 25th, 2012 at 10:46:32 AM EST
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There surely is a point at which upsizing becomes less efficient. But increasing farm size has been and still is, in the EU at least, government and agro-industry policy.

The combine harvester isn't the only criterion, btw - farmers aren't all pure grain producers. There's a drive in most of the EU to wipe out smaller dairy producers, for instance. It works mainly by scheduled reductions in milk prices paid to producers. That is, planned elimination of the smaller units.

by afew (afew(a in a circle)eurotrib_dot_com) on Mon Jun 25th, 2012 at 11:20:35 AM EST
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