1146 PONTIFICIAE ACADEMIAE SCIENTIARVM SCRIPTA VARTA - 2& 
differential and the percentage of the labor force engaged in 
agriculture will decline. Obviously, if the relative increase 
in the marginal product in thé nonfarm sector is large enough, 
a rise in the relative price of farm products could offset the 
decline in the earnings to farm labor and maintain the same 
distribution of employment. However, this consequence will 
almost certainly place a severe restraint upon the rate of growth 
of per capita income. It means that virtually all of the in- 
creased productivity must come in a sector of the economy that 
employs a very small fraction of total labor. 
If population increase is introduced into the picture, the 
relative growth of demand will not be a direct function of 
relative income elasticities. The relative growth will depend 
upon the annual population growth plus the change in per 
capita income weighted by the income elasticities. But the 
growth "of population means that a significant part of the 
increase in agricultural output is required to maintain per ca- 
pita consumption of food. Unless additional land of quality 
equal to that already under cultivation is available, a change 
in methods of production will bé required to offset the effect 
of diminishing returns as the amount of labor applied to each 
unit of land increases. Unless such a change in methods of 
production occurs, the real cost of food will increase and re- 
sources that could be used to increase nonfarm output will be 
shifted to agriculture and the rate of growth of total output 
will decline. 
Significant rates of economic growth can occur only if there 
are increases in productivity in a sector that employs the major 
fraction of all of the labor of an economy. Fortunately, in- 
creases in resource productivity in agriculture are possible and 
the same set of forces that result in higher productivity in 
nonfarm sectors appears to have been roughly as important in 
agriculture as in the rest of the economy. 
The factors that make it possible to increase agricultural 
output per capita in the face of increased population. which 
161 Johnson - pag. 6