Evaluation of technical, allocative and economic Efficiencies of rubber-cassava based farming system In edo state, nigeria

Abstract

This paper evaluated the technical, allocative and economic efficiency of rubber- cassava intercrop system among smallholder rubber farmers in Edo Sate Nigeria through a survey of 160 rubber farmers in a multi stage purposive and simple random sampling techniques. Data collected were analyzed using budgetary techniques and stochastic frontier production function analysis. Budgetary analysis reveals an average total cos/ha of 93350. S583.44) with N169,560 (S1,059.75) accrues to the farmer as revenue and N76210(S476.31) as gross margin with a net farm income of N70,710(S441.94). The rate of return and return per capital invested were N1.82 and N0.82 showing both viability and profitability of rubber- cassava farming. The Maximum Likelihood Estimate (MLE) of the parameters of the stochastic frontier production function of the sampled farmers revealed that planting materials, agrochemicals, labour and farm size were significantly related with cassava output. The mean technical efficiency (TE) of respondents' was 0.82 with the scope of improving their efficiency by 18%. Education and extension contact were the significant factors that increase the technical efficiency of farmers. The estimates of the parameters of stochastic cost frontier also showed that the cost of planting materials, agrochemicals, depreciation, cost of labour and output were significantly related with cost of production with mean allocative efficiency (AE) of 0.67. Age, education, farming experience and extension contact enhance the allocative efficiency of rubber farmers. The economic efficiency index ranged from 0.18 to 0.85 with the mean of 0.55 indicating wide differentials between the least and efficient farmer with the scope of improving economic efficiency among rubber farmers by 45% in the short-run. Recommendations to improve efficient allocation of resources in a rubber cassava based farming system have been made in the study in the study.