My assumptions include a diversified farm of approximately 25 to 30 acres, operated with an ecological and sustainable consciousness. This farm utilizes methods such as cover cropping, limited tillage, minimizing off-farm inputs, integrated pest management, crop and landscape diversity, community cooperation, and direct marketing. This type of farm generally has slower and lower power requirements than a larger, less diversified operation.
For estimated equipment operating costs I use as a reference Doane's Agricultural Report, volume 63, number 34-5, August 2000. The tractor costs from my own operation are consistent with this report, but conservative. My operational costs for using horses are also conservative, which may be typical of the agricultural practices of sustainable small farmers in general. From what I have seen, most other sustainable farmers operate their farms in a conservative manner, especially when compared to conventional agricultural practices.
Yor farming operation undoubtedly has different values to substitute, and you may readily customize my analysis for your own situation. This analysis looks at the two options only from a cash basis, as cash flow often causes the most problems, and many farmers are debt adverse and/or do not have ready access to debt financing. The farm owner, as the tractor operator or horse teamster, takes wages from farm profits.