- 33 -


 Regardless of one's position on these contrasting views, there is little

doubt that the larger the fraction of total farm product consumed by the farm

family, the closer the direct functional relationship between output and con-

sumption or level of living.

 This characteristic is of critical importance because it determines the

degree to which decisions regarding output, consumption, savings, and investments

are inter-related. T' ;u:': susstence peasant household output and consump-

tion are virtually equivalent so that "income" and consumption are jointly depen-

dent.Several models of peasant economic behavior relying upon this inter-related-

ness of production and consumption have been developed [Sen, 1966; Nakajima, 1969;

Krishna, 1969]. Each follow fairly similar assumptions regarding utility, pro-

duction, etc. and demonstrate that even in pure subsistence cases, farm output

is a function of the traditional production variables and level of technology

employed. Hence, the actual annual level of living experienced by a peasant

family through time is a function of the absolute level and quality of resources

employed in production and the technology employed. The closeness of this level

of living to the physiologic minimum and to the minimum subsistence standard is

consequently closely related to the farmers resource and technological endowment.

 Under such circumstances, it would be possible to discern three types of

farmers or three different situations depicting the interrelationships through

time of levels of living, achievement and subsistence standards, and physiological

minima (Figure 1). (The farmers are all assumed to have the same numbers/sex/age

composition so that the minimum, Pm., is identical.) In situation A the typical

low-income subsistence case, the range among all four variables is quite narrow.

Sms is close to Pm and L is close to S'ms In this case, physical survival con-

siderations are paramount. In situation B, the intermediate case, Sms is