Sensitivity analysis and efficiency of cocoyam producers in Kaduna State: An application of data envelopment approach

Abstract

The study focused on sensitivity analysis and efficiency of cocoyam producers in Kaduna State using data envelopment approach. The technical, allocative and economic efficiencies of cocoyam farmers and the factors influencing economic efficiency of cocoyam producers and sensitivity analysis of the optimum plan of cocoyam production were estimated. Primary data were collected from cocoyam producers through the use of structured questionnaires. This study was carried out in three (Giwa, Ikara and Kudan) Local Government Areas in Kaduna State, Nigeria between August and November 2016 cropping season. Multistage sampling procedure were employed for data collection. It was observed from the study that majority of the respondents (36.29%) operated within a technical efficiency range of 0.81 and less than 1.00, the respondents (27.42%) operated within an allocative efficiency range of 0.2 and less than 0.2. The study also suggests that economic efficiency among the respondents varied widely ranging between 0.029 and 1.00, with a mean economic efficiency of 0.335. The results revealed that none of the sampled cocoyam farms reached the frontier threshold and the low level of overall economic efficiency is the result of higher cost (allocative) inefficiency and scale inefficiency (operating at less than optimal scale size). Also, age, education, extension and amount of credit received were the socio-economic variable responsible for the variation in economic efficiency of the cocoyam producers. The sensitivity analysis showed that resource allocation patterns in the optimum plan were remarkably different from that in the existing plan. However, this result calls for increase in labour supply as well as decrease in fertilizer usage among farmers.