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Abstract

Buying and selling advantages are greater than internal economies for large versus family-sized Midwestern corn farms. Rates of return on investment both before and after income tax costs are considered are greater for the large operations because of (1) economies of size, (2) use of financial leverage, and (3) activities, such as those of purchase and sales agents, that enhance buying and selling advantages. Large units produce a small percentage of total U.S. com. Family-sized units will probably be the most important units in Midwestern com production for some time because of their present large number and the difficulty of establishing new large units. Most of the large units of the future will probably evolve from present family-sized units with aggressive growth strategies.

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