ABSTRACT
The study analyzed the efficiency and welfare of smallholder yam farming households in Benue State, Nigeria. Primary data were collected from 108 yam farming households selected using multistage sampling technique. The data from 2018 cropping season were collected with the aid of structured questionnaire. Data were collected using well structured questionnaire and were analyzed using descriptive statistics and Stochastic Frontier Production Function. The result of the cross tabulation between socioeconomic characteristics and technical efficiency shows that male headed households were more technically efficient with a mean technical efficiency of 0.73, a mean age of 50 years, a mean household size seven, mean farm size of 1.33 and a mean technical efficiency of 0.77 for households with farming experience between 11-20 years. The technical efficiency score of each respondent revealed that the most efficient farmer operated at 91% efficiency, the least was found to operate at 42% efficiency level, while the average was 79%, indicating that yam farmers still have the potential to increase the efficiency in their farming activities by 21% in the study area. The predicted allocative efficiencies differ substantially among the farmers ranging between value 0.414 and 0.821 with the mean allocative efficiency of 0.741. The yam farmer with the best and least practice had economic efficiency of 0.805 and 0.425 respectively. The mean economic efficiency was 0.65. The determinants of technical efficiency revealed that age, education, farm size, farming experience, extension contact and household size affect technical efficiency of the farmers. The variance parameters of the frontier production model were Sigma-squared (δ2) and Gamma (γ) and their estimated coefficients in the study area were 0.5259 and 0.6250 respectively. The regression estimates for determinants of welfare showed that education, household size, sex of household head, and household income were positive while age composition of the household head negatively influence welfare. The return per ₦1 invested was estimated to be ₦1.34. Hence, yam production was profitable in the study area. The major constraints were inadequate access to credit facilities, poor transportation network, pests and diseases, insurgency and high cost of labour. The study recommended that farmers should limit the use of agrochemicals while yam sett, fertilizer and labour that significantly affect production should be increase alongside with intensive use of farm size to boost more production.
TABLE OF CONTENTS
Title
Page i
Declaration
ii
Certification iii
Dedication iv
Acknowledgement v
Table
of contents vi-viii
List
of Tables ix
Abstract
x
CHAPTER 1: INTRODUCTION 1
1.1 Background of the Study 1-4
1.2 Problem Statement 4-6
1.3 Objective of the Study 6-7
1.4 Research Hypotheses 7
1.5 Justification for the
Study 7-9
CHAPTER 2: LITERATURE REVIEW 10
2.1 Conceptual Literature Review 10
2.1.1 Concept of Efficiency 10-13
2.1.2 Small-holder Farmers 13-14
2.1.3 Household Welfare: Concept, Measurement and
Determinants 14
2.1.3.1 Concept of Household Welfare 14-15
2.1.3.2 Measurement of household Welfare 16-221
2.1.3.3 Determinants of Household Welfare 21-24
2.1.4
Concept of Farm Cost 24-25
2.1.5 Concept of Farm Revenue 25
2.1.6 Farm Enterprise Production 25-26
2.1.7 Production Function
Analysis 26
2.1.8 Yam (Dioscorea spp) 27
2.1.8.1 Origin and domestication of
Yam 27-28
2.1.8.2 Varieties of Yams 28-30
2.1.8.3 Yam Production 30
2.1.8.4 Global
Production 30-31
2.1.8.5 Production in
Africa 31-32
2.1.8.6 Production in
Nigeria 32-33
2.1.12 Constraints
Limiting the Output of Yam Production 33-35
2.1.13 Yam
Production Cycle 35
2.2 Theoretical Literature 36
2.2.1 Theory of Profit maximization 36-37
2.2.2 Collective Household welfare and
intra-household inequality Theory 37-38
2.2.3 Theory of Production 39-40
2.3
Empirical Study 40-49
2.4
Analytical Framework
50-53
CHAPTER 3: METHODOLOGY 54
3.1 The Study
Area 54-55
3.2 Sampling Procedure 55-56
3.3 Method of Data
Collection 56
3.4 Method of data analysis
56-63
CHAPTER4: RESULTS AND DISCUSSION 64
4.1 Socio-Economic
Characteristics of Smallholder Yam-based Farm Households 64-69
4.2 Cost and returns in
Yam-based Production 70-71
4.3 Efficiency of Yam
Production 72
4.3.1 Estimated Technical Efficiency of
Yam Farming Households
72-76
4.3.2 Estimated Stochastic Frontier
Allocative Cost Function of Yam Farming Households 76-79
4.3.3 Distribution of respondents
according to Technical, Allocative and Economic Efficiency in the Study Area 80-81
4.4
Determinants of Technical Efficiency in Yam Production 81-85
4.5 Welfare status of Yam Farming Households and Factors
influencing Farmer’s Welfare 85
4.5.1 Welfare Status of Yam Farming Households 85-86
4.5.2
Factors influencing Farmers Welfare
86-90
4.6. Constraints to Yam-based Production in the
Study Area 90-91
CHAPTER 5: SUMMARY, CONCLUSION AND
RECOMMENDATIONS 92
5.1
Summary 92-93
5.2
Conclusion 94
5.3 Recommendations 94-96
References
97-113
.
LIST
OF TABLES
Table 2.1 Estimates of different
measures of efficiency by regions 50-51
Table 4.1 Socio-economic
Characteristics of the yam-based farm
households 69
Table 4.2 Cost and Returns of yam
production 75
Table 4.3: Results of Maximum likelihood Estimates (MLE) of the
Cob-Douglas Stochastic Frontier Production (SPF) for yam farming households 77
Table 4.4: Results of Maximum likelihood Estimates of Frontier Allocative cost 82
Table 4.5: Efficiency distribution of respondents from the
stochastic frontier model 85
Table 4.6: Results of Maximum likelihood Estimates of the determinants of technical
efficiency 87
Table 4.7 Mean per capital monthly expenditure of yam farming
household 90
Table 4.8: Estimated determinants of welfare of yam-based
farming households 92
Table 4.9 Constraints
to yam production in the study area 95
CHAPTER 1
INTRODUCTION
1.1
BACKGROUND OF THE STUDY
The socio-economic history and development of
Nigeria has been very closely tied to its agricultural sector (Egbuna, 2008; Toluwase
and Sekumade 2017). Agriculture holds the key to rural development, poverty
alleviation and overall economic development (Oluwafemi et al., 2010). The sector accounted for about 31- 42% of Gross
Domestic Product (GDP) between the year 2005 and 2008. In addition, it provided
paid and self employment for over 70% of the nation’s population (Nigerian
Export Promotion Council (NEPC), 2009).
Agriculture, a major resource based activity
in terms of capital and labour utilization has the potential of increasing
Nigeria’s food self-sufficiency (Bamire and Amujoyegbe, 2010; Man, 2015).
Statistical evidences however show that food sufficiency ratio of Nigeria has
for sometime especially from (1997-2010) been less than one. Actual yield of
major food crops are lower than their potential yields (Rahji, 2012).
The concept of efficiency is at the core of economic theory, its crucial
role in agricultural input/output analysis has been widely recognized by
researchers and policy makers alike. It is no surprise therefore, that
considerable effort has been devoted to the analysis of farm business level
efficiency in the developing countries. One way of increasing production by
farmers is to efficiently use all the resources available in the production
process (Mesikeet al; 2009). An
increase in efficiency in production could present a ray of hope and could lead
to an improvement in the welfare of the farmer and consequently a reduction in
their poverty level and food insecurity. Low yields are as a result of
inefficient production techniques manifested in technical and allocative
inefficiencies, over-reliance on household resources, labour-intensive
agricultural technology and rapidly declining soil productivity (Amaze, and
Manrice, 2005). One way of approaching the problem of increasing production
therefore, is to examine how efficient the farmers use their resources, if
resources use is inefficient, production can be increased by making adjustment
in the optimal use of factors of production in optimal direction. In case it is
efficient, the only way for increasing production would be through the adoption
of modern inputs and improved technology of production. (Mesikeet al; 2009).
Efficient farms make better use of existing
resources and produce their output at the lowest cost(Amaze, and Manrice2005,
Sunday et al., 2014). In a bid to help yam farmers increase
efficiency, the focus is usually on whether the yam farmers are using better
and improved technology. It is however necessary to investigate whether these yam
farmers are even making maximum use of what is available to them in terms of
inputs so that the stakeholders involved in agriculture will be convinced that
the new technology they intend to introduce to yam farmers will be used
efficiently and cost—effectively to boost output. Farmers might use resources
rationally but not at the economic optimal level (Terwase, 2013).
Yam
(Dioscoreasp)is, however, one of the principal root crops in Nigeria
both in terms of land under cultivation and in volume and value of production
(Bamire and Amujoyegbe, 2005). It’s one of the carbohydrate foods that is
nutritionally superior to most roots and tubers in terms of digestible proteins
and minerals (Calcium, Magnesium and Potassium(Ebeworeet al;2013). Tuber
crops, such as yam has high relative value per unit of land used in its
cultivation when compared with other crops particularly, the cereals (Mbah,
2010). As a food crop, yam has inherent characteristics. Firstly, it is rich in
carbohydrates especially starch and has a multiplicity of end use. Secondly, it
is more resistant to drought, pest and disease and tolerates different climatic
and edaphic conditions (Ugwumba and Omojola, 2012).
Yam
is an important source of income for all value chain participants. Yam
comprised 32% of farmers‟ gross income from crops for farmers in Eastern Nigeria.
The share of the value of yam farm gate sales (31%) was second only to cassava
(37%) out of the nine major food crops compared in Nigeria in 2004 (Sanusi and
Salmonu, 2010). The 2ndhighest nutritional quality and market value commanded
by yam when compared with other crops like cassava, have encouraged greater
investment by the Nigerian government and foreign donors to increase production
and improve yam marketing efficiencies to enhance income and food security
levels for smallholders.
FAO (2002) reported that Nigeria accounted
for about 71% (26 000 000 tons) of the total world production of yam harvested
from 2,760 ha. Yam production in Nigeria has more than tripled over the past 45
years from 8.7 million tons in 1961 to 31.3 million tons 2006. This increase in
output is attributed more to the large area planted to yam than to increased
productivity (Izekor and Olumese, 2010). Though the area cultivated to yam
production is still being increased, production growth rate declined
tremendously from average of 27.5% between 1986 and 1990 to 3.5% in the period
between 1991 and 1999 (FAO, 2002). However, between 2001 and 2006 production
growth rate increased by 31.3%. Record of yield showed similar trend during the
same period. Average yield per hectare dropped from 14.9% between 1986 and 1990
to 2.5% in the period between 1991 and 1999. However, the period between 2001
and 2006 recorded 23.4% increase in the average yield (Izekor and Olumese,
2010, Toluwase and Sekunmade2017).
In Benue State, yam is the most prominent
crop in the agricultural program of the State's current administration (BNARDA,
2017). The crop is also a significant source of income for rural farm
households. This is evident in the objectives of the Benue State Agriculture
Policy of 2015, which included the provision of an enabling environment for yam
production in particular, and other important crops in general, as one of its
intentions (BNARDA, 2017). Over the years, successive administrations in Benue
State have formulated and implemented policies and programs aimed at
stimulating increased production of this important crop.
1.2 PROBLEM STATEMENT
In
Nigeria today, yam cultivation still depends largely on traditional hoes and
cutlass techniques of production. Many aspect of production like clearing,
planting, weeding, staking and harvesting which require considerable inputs of
labour are still been done manually (Toluwase and Sekunmade (2017). The farm
hectarage of yam production has over the years been increasing with
corresponding increases in the usage of inputs. Unfortunately, the increase in
output seems not to have been commensurable with those in input usage (Jonathan
and Anthony, 2012;Man, 2015). Nigeria is the largest yam producer in the world
accounting for 65% of the global production in 2008 (FAO, 2010) yet there has
been a decline in yam production in Nigeria over the years (IITA, 2002). The
area under cultivation and total yam output were also declining (IITA, 2002 and
Ayanwuyiet al; 2011). Studies have shown that food crop farmers in
Nigeria have low productivity because of inefficiency in resource use (Idiong,
2010). Production is the process of transforming inputs such as capital, labour
and land into goods and services called output. One of the major targets of any
society is the attainment of an optimal level of production with a given amount
of effort. This has been the focus of many individuals, private and government
organizations worldwide aiming at poverty alleviation, high productivity and food
sufficiency, especially in developing countries including Nigeria (Jacobi,
1998; Mougeot, 2000; Man, 2015). Thus, any increase in the productivity of
resources employed in the production enterprise would amount to progress.
In
view of this, productivity gains in agricultural production (including yam
production) are considered as a pre–requisite for overall economic development
(Mafimisebi and Adams, 2003; Man, 2015). Efficiency analysis is an issue of
interest among economists in recent times. Optimization can be obtained either
by minimizing the cost of producing a given level of output or maximizing the
output attainable with a given level of cost. Both optimization problems
require the proper allocation of input for the goal to be achieved (Oluwatayo et
al; 2008; Alufohai and Izekor 2014; Man, 2015).
Despite
the government initiatives, Bamire and Amijoyegbe (2010) noted, in South
Western Nigeria, that there is an increasing gap between the levels of supply
and demand for yam. Also, Oladeebo and Okanlawon (2010) noted that the level of
yam production has remained static over a decade. This static trend may not be
unconnected with production resources which are not being efficiently utilized.
In order to meet the level of demand, there is the need to analyze the
efficiency and welfare and its determinants in yam production. Previous studies
carried out on food crop production in Nigeria have shown that food crop
farmers have low productivity because of inefficiency in resource use (Idiong, 2010:
Man, 2015).
According
to Spore (2011) about 35-50% of the total cost was constituted by planting
material. Consequently, there has been a decline in production over the years
with area under cultivation and yam output declining (Ayanwuyi et al., 2011;
Man, 2015). Meanwhile, the report of Benue State Yam Production Trend
established by the Benue State Agricultural and Rural Development
Authority(BNARDA) from 2001 to 2012 showed that the average yam yield per
hectare declined from 18.53 tonnes in 2009 to 14.12 tonnes in 2012.
To
achieve economic optimum output and thus profitability, resources have to be
optimally and efficiently utilized (Alufohai and Izekor, 2014). Though, yam
production in Benue State is a good source of income to the farmers, yet no
records have shown it to have attained optimal level which proper allocation of
inputs can achieve.
It
was against these problems that this study was undertaken to empirically analyze
the efficiency and welfare of small-holder yam farming households in the study
area. In view of this, the following research questions were addressed:
i.
What are the socioeconomic characteristics of yam farmers in the study area?
ii.
What are the cost and returns in yam production?
iii.
What are the determinants of output of the yam farmers?
iv.
What are the technical, allocative and economic efficiency of yam production
among the Yam farming households?
v.
What are the determinants of technical efficiency and economic
efficiency in yam production?
vi.
What is the welfare status of yam based farm households?
vii.
What are the constraints to yam production?
1.3 OBJECTIVE
OF THE STUDY
The
broad objective of this study was to examine the efficiency and welfare of
small-holder yam-based farm households in Benue State. The specific objectives
are to:
i.
examine socio-economic characteristics of smallholder yam farming
households in the study area;
ii.
determine the costs and returns and profitability in yam production;
iii.
estimate the production function and technical, economic and allocative
efficiency of yam production;
iv.
estimate the determinants of technical efficiency in yam production;
v.
establish the welfare status of yam farming households and factors
influencing farmers’ welfare; and
vi.
identify and describe the constraints to yam production
in the study area.
1.4 RESEARCH
HYPOTHESES
The
hypotheses tested for this study are:
1.
The coefficient of the yam mini-sett, fertilizer, labour, farm size and
agrochemical are not positively significant to yam production.
2.
Yam production is not profitable in the study area.
3.
The coefficients of level of education, years in yam farming and number
of extension visits should be positively influence technical efficiency while age
of the household head and household size should negatively influence technical
efficiency.
4.
Farmers welfare is negatively influenced by education attainment, sex of
household head, farming experience, income and asset endowment while age, labour
cost and household size positively influence farmers welfare
1.5 JUSTIFICATION
FOR THE STUDY
As the campaign for household food security gains momentum all over the
world that extreme hunger and poverty must be eradicated by year 2020, yam is
one of the food crop whose production has got to be emphasized (Michael, 2011; Man,
2015). Yam being an important food crop for at least 60 million people in West
Africa, it is therefore necessary to lower its production cost and scale up its
production through an efficient use of its production resources (Babaleye,
2009; Man, 2015). As a food crop, the place of yam in the diet of people in
West Africa and in Nigeria in particular cannot be overemphasized. According to
Reuben and Barau (2012) yam contributes more than 200 dietary calories per
capita daily for more than 150 million people in West Africa and also an
important source of income generation and trade. It is thus important that the
efficiency of its production be assessed. It is obvious that there is a
potential for the increase in its production and much can be done to derive
foreign exchange from its export (Ebewore et al;2013; Man, 2015). In
spite of this, little or no study has been conducted to assess the efficiency
and welfare of small-holders yam based farm households especially in Benue
State Agricultural and Rural Development Authority (BNARDA, 2012).
Boosting yam production could lead to an improvement in the food
production level of the nation. This, however, requires that resources be used
efficiently to achieve optimum production. Thus, it is expected that the
finding of this research would help in providing information and, probably, solution
to the declining productivity and yield of yam by identifying the problems associated
with yam production, the most factors influencing welfare, prospects and
potential areas of improvement. It is also expected that the research work will
serve as a guide to farmers currently engaged in yam-based production to
determine the actual level of their performance and welfare status. Similarly
the research work will be valuable to Government on the basis of rational and
empirical policy formulation with respect to yam production. Finally, it is
hoped that this research work will be of assistance to researchers who will
identify other areas for further improvement in yam production.
This study will be resourceful to policy makers as well as the private
sector and other interest groups on strategies to increase yam sub sector’s
contribution to national development, since policies and programmes derived
from studies are mainly tailored to address shortcomings in the system, expand capacity
and improve welfare of the citizenry.
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