Technical Efficiency of Maize Farmers in Ogbomoso Agricultural Zone of Oyo State

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1 Internatonal Journal of Agrcultural Economcs & Rural Development - 1 (): 008 Techncal Effcency of Maze Farmers n Ogbomoso Agrcultural Zone of Oyo State Adedapo, K. D Department of Agrcultural Economcs and Extenson, Ladoke Akntola Unversty of Technology, Ogbomoso Ngera e-mal: akolawoledaud@yahoo.com Abstract: The objectve of the study s to determne the techncal effcency of maze farmers n Ogbomoso agrcultural zone of Oyo state Agrculture Development Programme (OYSADEP).Descrptve statstcs and Maxmum Lkelhood Estmate (MLE) usng stochastc fronter producton model were used to analyze the data obtaned from one hundred and twenty ( ) sampled farmers. The result of the maxmum lkelhood estmate (MLE) showed that 5% of the varaton n output of maze among the farms was due to techncal neffcency. The techncal neffcency ndex computed shows a mean effcency rato of mplyng that substantal neffcency exsts among the maze farmers n the study area. It was concluded that the farmers n the study area were techncally neffcent. Keywords: Techncal effcency, maze, small-scale farmers INTRODUCTION Maze (zea mays L.) s a cereal crop of Gramnae famly whch s cultvated for ther seeds (grans). It consttutes a large percentage of the world s food supply. Maze s mportant n the feedng of human beng and lvestock because they have hgh starch (carbohydrate) content and varyng amount of protens and seeds can be dred to low mosture content. (Komolafe and Adegbola, 1978). Maze s one of the most useful crops ever grown n hstory. It can be boled or roasted or made nto a paste eaten by adult and chldren. It can also be used to make abodo and elekute n Ngera and kenke and akpele n Ghana. Fred maze s also good n makng popular refreshment called guguru or pop corn. Ths s eaten all over the world. Industral use of maze ncludes the producton of breakfast cereals lke custard, cornflakes, corn ol, glucose, starch and alcohol (Komolafe and Adegbola, 1978). The food problem n Ngera has been exacerbated by the level of productvty of resources used n recent tme. Ths has necesstated the supplementaton of domestc supply wth large mportaton of food. The food mport bll rose sgnfcantly from N mllon n 1987 to N 147, mllon n 1996 (FOS,1997). Ths consttutes a great dran on the country s foregn reserve. Also, a country that depends heavly on food mportaton from other countres can not be sad to be truly ndependent. Ths s because food mportaton may consttute a dran on the country s foregn reserves and at tmes the mportng country can be held to ransom n crtcal tmes, especally when there s polcy change (e.g. export restrcton) or unforeseen crcumstances n the exportng country. The objectve of ths paper s to determne the techncal effcency of maze farmers n the Agrcultural Development

2 Internatonal Journal of Agrcultural Economcs & Rural Development - 1 (): 008 Programme (ADP) zone of Ogbomoso. Determnaton of nput-output relatonshp for any partcular economc actvty s mportant, at least for three reasons. The estmated parameters of the producton functon wll show the. Elastc of output wth respect to partcular nput. Elastc of output wth respect to a proportonal change n all nputs and. Elastcty of substtuton between nputs Furthermore, the man concern of any economc actvty s to acheve the maxmum possble by transformng a set of gven nput nto some output defned by the producton functon. It has been the general consensus that n the developng countres, farmers do not explot resources fully. (Bathese and Coell, 1995) The concept of techncal effcency can be clearly understood by referrng to fgure 1. In fgure 1, the curve YM shows the maxmum possble total output (at the fronter) as nput X ncreased, whle the curve YA shows the nput response n an average farm. Y YM (fronter product functon) Y 4 Y 3 Y Y 1 0 YA (Average product functon) farm 1 Farm X X 1 X Fgure 1: Techncal effcency The techncal neffcency s gven by Y / Y 3 for a gven nput level X 1 farm. For farm techncal.e. neffcency s gven Y 1 / Y 4 usng nput X. Numerous studes have attempted to determne the techncal effcency of farmers n developng countres because determnng the effcency status of farmers s very mportant for polcy purposes. Effcency s also a very mportant factor of productvty growth n an economy where resources are scarce and opportuntes for new technologes are lackng, neffcency studes wll be able to show that t s possble to rase productvty by mprovng effcency wthout ncreasng the resource base or developng new technology. Estmate on the extent of neffcency also help to decde whether to mprove effcency or to develop new technologes to rase agrcultural productvty. Accordng to Yao and Lu (1998), for effcent farmers, government can expedte development by emphaszng new nvestment or technologes rather than extenson and educaton efforts whch were amed at less effcent farmers. Nevertheless, studes by Alm (000), Ayanwale (1995) and Jandrow et al (198) found evdence of techncal neffcency among farmers n the developng countres. METHODOLOGY The study was carred out n Ogbomoso agrcultural zone. Ths comprses of fve (5) local government areas. These are Ogbomoso North, Ogbomoso South, Ogo-Oluwa, Orre and Surulere local government areas. The populaton for the study are the ADP maze farmers n the study area. The zone experence both wet and dry season annually. The clmate of the area favours maze producton. The rany season usually starts n March and last tll November. The dry season s usually very hot except durng harmattan perod when t s cold and dry. Majorty of the populace combnes subsstence farmng wth other 3 Produced by IJAERD Press - Ngera, 008

3 Internatonal Journal of Agrcultural Economcs & Rural Development - 1 (): 008 occupaton lke tradng and cvl servce (school teachers) A mult-stage samplng technque was used. A lst of all the maze farmers n all the fve local government areas was obtaned from the ADP zonal headquarters n Ogbomoso. From the lsts 3 vllages were randomly selected from each of the fve local government areas and from each of the 3 vllages, 8 maze farmers were selected. Ths gves a total of respondents. Method of data analyss - A combnaton of descrptve and stochastc producton functon model usng the method of Maxmum Lkelhood Estmate (MLE) wth computer programme FRONTIER verson 4.1 (Coell, 1994) were used to analyze the data obtaned from the farmers. Descrptve tools ( percentages and frequency) were used to analyze the soco-economc characterstcs of the farmers whle Maxmum Lkelhood Estmate (MLE) was used to analyze the techncal effcency of the farmers. The model s expressed as Y = exp X β + V U ) ( (1) The techncal effcency of producton of the th farmer n the approprate data set, gven the level of these nputs, s defned by TE = exp( V ) = Z σ () From equatons (1) and (), the random factor (v) s ndependently and dentcally dstrbuted wth N (O, σv) whle the techncal neffcency effects U s often assumed to have a half normal dstrbuton /N (O, σ v). The farm specfc techncal effcency (TE) of the th farmer was estmated by usng the expectaton of v condton on the random varable (E) as shown by Battese and Coell (1995). The TE of an ndvdual farmer s defned n terms of the rato of the observed output to the correspondng fronter output gven the avalable technology, that s; exp( X β + V U ) TE = Y = esp( X β + V ) Y = exp( U (Tadesse and Krshnamurthy, 1997) )... (3) So that 0 < TE < 1.e. techncal effcency s between 0 and 1) In the study area, a separate stochastc fronter producton proposed by Bathese and Coell (1995) was appled n the analyss of data to capture the effcency of ADP maze farmers. The emprcal model of the stochastc producton fronter s specfed as lnyj = β 0 1 1j j 3 j 3j 4 4j 5 5j 6 6j + Vj U. (4) Y Maze output n Kg Y 1 - Total quantty of seed used (Kg) Y - Total quantty of labour used (Mandays) Y 3 Cost of transportaton (Nara) Y 4 Quantty of herbcdes used (Kg) Y 5 Quantty of fertlzer used (Kg) Y 6 Cost of farm mplement Vj s a random error term ndependently and dentcally dstrbuted (have a normal dstrbuton wth mean zero and varance σ v) ntend to capture event beyond the control of farmers. Uj s non-negatve random varable called techncal neffcency effects assocated wth 4

4 Internatonal Journal of Agrcultural Economcs & Rural Development - 1 (): 008 techncal effcency of producton of farmers nvolved. In- s the natural logarthms (to base e). RESULTS AND DISCUSSION Soco- economcs characterstc of the farmers The age dstrbuton of the respondents accordng to Table 1 shows that most of the farmers (3%) are between 40 and 49 years of age. About 9% are between 30 and 39 years whle 3% are between 50 and 59 years of age. The mean age of the respondent s 4.50% years. Ths shows that the farmers are stll n ther actve age. Majorty of the farmers are male (83.3%). Whle only 16.7% are female. Also from Table 1, 88% of the respondent are marred whle only 8.3% are sngle, % each are dvorced or wdowed. Ths shows that majorty of the respondents are marred men and women. On the level of educaton, majorty of the respondents are lterate whle only 5% have no formal educaton. The mean year of experence of the maze farmer n the study area s 11year. Ths shows that maze producton has been n exstence long ago as majorty of the farmers (about 86%) have been n maze producton for about 0 years. The mean household sze of the respondent s about 7. Ths shows that farmers can have easy access to addtonal labour from the famly members. Table 1: Socoeconomcs Characterstcs of the Respondents Varables Frequency Percentage Age (years) Sex Male Female Martal status Sngle Marred Dvorced Wdowed Educaton No Formal Educaton Prmary Educaton Secondary Educaton Tertary Educaton Experence (years) Household sze Source: computer from feld survey data, (007) Result of Ordnary least square estmate - The OLS method was used to analyze the data. The result shows that quantty of seed, labour, transportaton, herbcdes, fertlser and other cost were sgnfcant at 1% level. The coeffcent of labour and herbcde have negatve sgns, whch mples that an ncrease n the use of these nputs leads to a decrease n the level of maze producton and the techncal effcency of the farmers. Other varables wth postve co effcency mply that they contrbute postvely to the productvty of maze n the zone. The quantty of these nputs should be ncreased n order to ncrease the techncal effcency as well as the productvty of maze farmers. 5 Produced by IJAERD Press - Ngera, 008

5 Internatonal Journal of Agrcultural Economcs & Rural Development - 1 (): 008 Y = log X + X log X X log X log X 5 0.log (0.69) (0.680) (0.11) (0.619) (0.119) (0.19) (0.139) Maxmum Lkelhood Estmate (MLE) Result- The maxmum lkelhood estmate (MLE) of the parameters result s presented n Table. It shows the effcency n the use of the avalable resources and technology. Four of the explanatory varables ncluded n the model have postve relatonshp wth the output of maze whle only two varables, labour and herbcdes have negatve relatonshp wth maze output. Ths mples that an ncrease n the use of these varable decrease maze output. All the varables are sgnfcant to maze output. Ths corroborates the result of the OLS The estmated varance of parameters whch s the rato of the performance of farm specfc effcency ndces to the total varance of output was Ths mples that 5% of the varaton between the observed output and the fronter output are due to techncal neffcency. In essence, the shortfall observed n output from the fronter output s due prmarly to factors wthn the control of the farmers. The varance of the parameter s sgnfcant and statstcally dfferent from zero whch confrms that there s techncal neffcency n the producton of maze n the study area. Table Fronter Analyss Result Varable OLS Estmate Fronter estmate Constant Quantty of seeds (X 1 ) Labour (X ) Transport (x 3 ) Herbcdes (X 4 ) Fertlser (X 5 ) Other cost (X 6 ) Log lkelhood functon Sgma- square Gamma a (0.69) (0.68) (0.11) (0.619) (0.119) (0.14) 0.9 (0.139) Source: Computed from feld survey data, 007 The value n parenthess s the T rato Sgnfcant at 1% level 0.95 (0.94) (0.96) 0.41 (0.99) 0.14 (0.91) -0.1 (0.99) (0.98) 0.11 (0.99) Techncal effcency dstrbuton In Table 3, the techncal effcency ndex s presented usng Jondrow et al (198) procedure. The mnmum estmated effcency s 30% whle the maxmum effcency s 9.5% and the mean level of techncal effcency s 76.3%. Accordng to Grabowsk et al (1990) a farm s consdered techncally neffcent even f the farm regster a techncal effcency ndex of 8%. Gong by ths standard the number of maze farmers consdered effcent techncally s less than 15% of the total maze farmers n the sample under study. Ths ndcates that maze farmers can ncrease ther productvty by rasng the techncal effcency through ncreased nput usage. Table 3: Techncal Effcency Dstrbuton. Effcency Frequency Percentage ndex Total Source: computed from feld survey data, 007 Mean effcency = 76.3% Maxmum effcency = 9.6% Mnmum effcency = 30% CONCLUSION The study examned the techncal effcency of ADP maze farmers n Ogbomoso agrcultural zone of Oyo state. Maxmum lkelhood estmaton procedure was used to analyse the data obtaned from the sampled farmers to derve the fronter producton functon. The techncal effcency ndex computed ndcated strongly that most of the maze farmers n the 6 6

6 Internatonal Journal of Agrcultural Economcs & Rural Development - 1 (): 008 study area are hghly techncal neffcent wth a mean effcency raton of Ths shows that great potental exsts for the farmers to further ncrease output usng the avalable nputs and technology Conclusvely, the research fndngs show that there s a bg scope to ncrease techncal effcency of the farmers wth the exstng level of nputs. Ths mples that the techncal effcency can be ncreased substantally wth extenson servces wth all necessary techncal assstance for the dssemnaton of tmely nformaton to farmers and to relay ther problems to researchers for soluton. Ths wll go a long way to ncrease the level of techncal effcency and output of the maze farmers. Therefore effort should be drected n educaton, extenson servces, credt facltes for the purchase of necessary nput(seed, fertlser and herbcde) as well as other support servces n order to mprove the techncal effcency of the maze farmers n Ogbomoso agrcultural zone of Oyo state. REFERENCES Alm: T (000) Resources use effcency n food crop producton n Oyo state of Ngera Journal of Agrculture and Envronments 1(1): 1-7 Ayanwale, A.B. (1995): Resources use Effcency n cassava processng n Oyo North Area of Oyo stat, Ngera Ife journal of Agrculture 16 and 17: Belbese, K and R. Grabowsk (1985). Techncal effcency n Nepalese Agrculture Journal of Development Areas, 19 (4) : Bethese G.E and T.J Coell 1995). Predcton of frm level of Techncal Effcency wth Generalzed fronter Producton and panel Data. Journal of Economcs 8: Coelll; T.J (1994) A gude to fronter verson 4.1: A computer for stochastc fronter producton functon and cost functon estmaton. Unpublshed paper, Department of Economcs, Unversty of New England, Armdala NSW 351; Australa pp 3-38 FOS 1997: Revew of the Ngera Economcs. Publcaton of the offce of statstcs. (FOS) July 1997 Jondrow, J., Lovell, CAK., Materou, I.S and P. Sehmdt, 9198) The estmate of techncal neffcency n the stochastc fronter producton functon model. Journal of economcs 19:69-94 Komolafe A.F and A.A Adegbola (1978) Agrcultural Scence for West Afrcan Schools. 78p. Tadesse B. and S. Krshnamurthy (1997). Techncal effcency n paddy farms of Taml Nadus. An analyss based on farm and ecologcal zone. Journal of Agrcultural Economcs 16: Yao; S. and Lu Z. (1998) Determnants of gran producton and techncal Effcency n Chna Journal of Agrcultural Economcs 49 () : Produced by IJAERD Press - Ngera, 008