Production Elasticities, Return To Scale And Allocative Efficiency In Yam Production In Edo State, Nigeria

Abstract

The study estimated the production elasticities, the return to scale and analysed the allocative efficiency of resources used in yam production in Edo State. A four-stage sampling process involving simple random sampling was employed to select 180 yam farmers and a set of questionnaire was used to collect data from the respondents. The Data collected were analysed using stochastic frontier production function and marginal analysis. The result of the study showed that none of the inputs used by the farmers was efficiently allocated and utilised. Land (15.72), planting material (7.27) and fertilizer (2.38) were under-utilised, while labour (0.63) and agrochemical (0.52) were over-utilised. This showed that there was the existence of disequilibria in the allocation and utilisation of inputs by yam farmers in Edo State. Also, production elasticity estimates indicated that the farmers’ production was in stage 1 (irrational stage) of the production function indicating that there is room for expansion in output and productivity of yam farmers in Edo State. This can be actualised by cropping higher hectarage of farm land with increased quantity of planting material and controlled usage of higher quantities of fertilizer as these were found to be under-utilised. A return to scale of 1.434 indicated increasing returns to scale.

Keywords: Allocative Efficiency, Elasticity of Production, Return to Scale, Yam.