In many developing countries like Pakistan, most research workon farm mechanisation has focused especially on farm labour displacementand income effects. These studies measure only the micro or directeffect of mechanisation on a specific farm unit, area or locality. Theylack macro level impact of technologies that emerge from lin~agesbetween farm and non-farm sectors and between farm and the household:The importance of these production anq consumption linkages inagricultural growth has been emphasised [Hazel and Roell (1983); Mellorand Lele (1973); Mellor (1976); Yotopoulos and Nugent (1976)]. Thegrowth linkages between farm and non-farm economy are primarily due toincreases in household consumption expenditures. Increases in householdconsumption expenditure is directly related to escalation in income.Leontiefs (1951, 1966) inpu-output system provides a framework measurethe overall effect of farm mechanisation employment an income. King andByerlee (1977) measured links between changes income distribution andits effect on employment. Rangarajan (1982); Hazel an Roell (1983)showed that agricultural growth has substantial effects on other sectorseconomy. Ahammed and Herdt (1983 1985) also used the input-outputsystem. The present study is basically an adoption of Ahammed andHerdt’s (1983) model. A system of linear homogenous equations whichpermits solutions by simple matrix inversion operations hsa beenused.