Once upon a time many, many years ago, there lived a feudal landlord in a small province of Western Carthage. The landlord, Sheik Selim, lived in a castle high on a hill. He was responsible for the wellbeing and welfare of the ‘people’ who occupied the lands surrounding his castle.
Each Fall, before the weather turned cold, Sheik Selim would decide which winter crops to plant to provide for his people during the coming year.
One Fall, Sheik Selim was thinking about the winterwheat crop for the coming growing season. ‘I believe that 30 acres of my land, which are worth 25 bushels34 of wheat per acre, if I wanted to sell them, will produce enough wheat by next Summer to feed my ‘‘people’’ for the whole year,’ he mused, ‘but who should till the land, plant and harvest the crop? I believe I’ll give Anis and Sami the responsibility of growing wheat this year.’ Whereupon, Sheik Selim summoned Anis and Sami to an audience in the Great Hall of the castle
‘Anis, you will take care of the 20-acre35 plot of ground in the river bend and Sami, you will farm the ten-acre plot, downstream by the woods’, Sheik Selim began. ‘I will provide Anis with 20 bushels of wheat for seed and with 200 pounds of fertilizer.’ (200 pounds of fertilizer would be worth 20 bushels of wheat on the local market.) ‘Sami will be provided with ten bushels of wheat for seeds and with 100 pounds of fertilizer. I will grant each of you the exclusive use of one of my oxen to pull the plow, but you will have to make arrangements with Mahmoud, the plow-maker, for him to provide you with a new plow. The oxen, incidentally, are only three years old and, although quite well trained, they have never been used for farming. They should have a good ten years of productive life ahead of them. Take good care of them because I could, right now, sell each ox on the market, for the equivalent of 40 bushels of wheat each. Come back next Fall and return the oxen and the plows, along with your harvest.’
Anis and Sami bowed and withdrew from the Great Hall. On their way back to their lodging, they took with them the various items provided by Sheik Selim
Fall, Winter and Spring came and went, and after the late Spring harvest, Anis and Sami returned to the Great Hall to account to their master for the things granted to them in the previous Fall. Anis said, ‘My Lord, I present you with a slightly used ox, a plow, broken beyond repair, and 223 bushels of wheat. I, unfortunately, still owe Mahmoud, the plow-maker, three bushels of wheat for the plow I got from him early last Fall. And, as you might expect, I used all the fertilizer and seed you gave me last Fall. You will also remember, my Lord, that you already took 20 bushels of my harvest for your personal use a few weeks ago.’
Sami spoke next. ‘Here, my Lord, is a partially used ox, the plow for which I gave Mahmoud, the plowmaker, three bushels of wheat from my harvest, and 105 bushels of wheat. I, too, used all the seeds and fertilizer you handed me last Fall. Also, my Lord, several days ago, your staff took 30 bushels of my wheat crop for the village needs. I believe the plow is good for two more seasons.’
‘You did well,’ said Sheik Selim. Happy with this acknowledgement, Anis and Sami departed.
After they had taken their leave, Sheik Selim began to contemplate what had happened. ‘Yes,’ he thought, ‘they did well, but I wonder which one did better?’
Required
In the two questions below you will assume, in succession, the three alternative following ‘contracts’ (Anis and Sami and their families can live, year around, including the agricultural season, off the land each one is in charge of, and therefore their daily life expenses are irrelevant to his case):
(a) Anis and Sami are salaried workers for Sheik Selim. The agreed-upon salary is four bushels of wheat per acre per season (salaries are paid after the end of the season).
(b) Anis and Sami are ‘farmers’, i.e., they pay rent to the owner of the land at the rate of six bushels of wheat per acre. In addition, they have to compensate Sheik Selim (without interest) for the use of the ox, and for both the seeds and the fertilizer consumed. Any remaining production, after paying Sheik Selim for the value of the resources consumed, is theirs to keep and do as they please. Rent and any and all payments to Sheik Selim are settled after the end of the harvest season.
(c) Anis and Sami are each in separate partnerships with Sheik Selim. Sheik Selim contributes the land, the seeds, the fertilizer and the oxen to each venture. Anis and Sami each contribute their best effort and intelligence to the venture they are involved in. It is agreed that Anis and Sami will each get to keep one third of the ‘profit’, if any, arising from the combination of their respective work with the resources provided by Sheik Selim.
1 For each plot of land (defined as a ‘business entity’), prepare a statement (or statements) describing, from the point of view of Sheik Selim (and of Anis or Sami, if appropriate), the resources of the business (and their origin) at the beginning and at the end of the growing season and a statement describing, for the entire season, the consumption and creation of ‘resources’ by each business entity.
2 From the point of view of Sheik Selim, which person (Anis or Sami) was the better steward of the resources provided to him? What do you recommend Sheik Selim should do for the next growing season?