ing Amounts._--The amount of
capital that is combined with a unit of labor is not often the same on
good land as it is on poor. The proportions in which labor and capital
will be combined on the marginal field will be almost certain to vary
from those in which they were combined in the better field from which
they came. It may be that they leave industries in which an average
man uses an equipment worth a thousand dollars. When they reach the
margin of cultivation, capital may be so scarce that the thousand
dollars will not stay in the hands of the one man but will divide
itself among several.

_The General Law of the Extension of the Margin of
Cultivation._--Sometimes, when labor moves to new land that is now at
the margin, it takes its new equipment with it; but such land is not
always tilled by independent settlers. Employing farmers may set men
working on it and pay them all that they produce; and the farmers may
furnish the men with capital of their own or borrow capital for them
to use. In either case a static condition requires the equalizing of
the productivity of labor at the intensive margin with that of labor
at the extensive margin; and it requires a similar leveling of the
productivity of capital at the two margins. When this leveling has
taken place in both cases, the all-around marginal product of labor
fixes the rate of wages, and that of capital fixes the rate of
interest. What a man creates on the good land and with the adequate
capital, or on poor land with proportionate capital,--in any
occupation on land of either grade,--determines the pay that he and
other men can get. It constitutes in itself the wages of labor. In so
far as the overflow of labor and capital into any one limited region
of marginal land is concerned, the full statement is this: that the
margin of utilization of land will be extended to the point at which a
unit of labor, _using as much of the marginal land as it is economical
to use, and such amount of auxiliary capital as is economical to
combine with this unit of labor and the land it occupies, will create
a product equal to the wages of the unit of labor as they are
determined by the product it created when it was employed on the good
land and in connection with the full equipment of auxiliary capital_.

_The Rent of a Fund of Capital._--We saw that one unit of labor
employed in connection with a given amount of capital produces more
than does a second; that the second produc