Resource Productivity And Economic Efficiency Of Farm Credit And Non Farm Credit Users In Rivers State, Nigeria

Abstract

Resource productivity, economic efficiency and returns to scale of Farm Credit and Non Farm Credit Users in Rivers State were determined and compared. Cross- sectional data collected from 200 Farm Credit and Non Farm Credit Users randomly selected from ten out of the fifteen upland Local Government Areas were used. Production function and profit function analysis were used in analyzing the data. Results of data analysis showed that farm land and capital input were more productive among Farm Credit Users while labour input was more productive among Non Farm Credit Users. Furthermore, results of data analysis on relative economic efficiency showed that Farm Credit Users were relatively more economically efficient than Non Farm Credit Users. The results also showed that both Farm and Non Farm Credit Users were operating in region three (decreasing returns to scale) of the production function. Both farmer groups can therefore improve on their productivity by reducing the current levels of resource employment at the prevailing level of technological development. It is recommended that programmes geared towards increasing the accessibility of smallholder farmers in Rivers State to credit facilities be put in place. Credit facilities should also be extended to the Non Farm Credit Users to enable them purchase improved planting materials and hire more farm hands. Extension agents should be made to carry out an enlightenment programme, to sensitize the non farm credit users on the importance of farm credit in agricultural development.