this is quite surprising. tolkien modelled the shire upon his personal ideal, his eden. and usually, fantasy mostly ignores one key point: subsidience farming usually doesn't yield much surplus, but the depicted hobbits were able to live lives of simple pleasures, mostly farming and then eating what they farmed.
usually this would be hand-waved away with some explanation; hobbits could be so magically gifted at farming they'd create a food surplus from farming so big as to allow for some relatively large allotment of luxury and leisure time.
tolkien isn't the type to hand-wave anything away, though; here's a - sobering - explanation:
Understanding this sheds a great deal of light on Tolkien’s explanation of the Shire’s governance. The lack of much organized administration is not, as some suggest, a form of democratic anarchism, but instead the result of elite control.
read: The Moral Economy of the Shire
update: don't forget the comments, they're great!