Analysis of Allocative Efficiency among Dry Season Vegetable Farmers in Southwest, Nigeria

Using the readily available and cost-effective resources to achieve the desired production goals is crucial to farmers in Nigeria. The study examined the allocative efficiency among dry season vegetable farmers in selected wetland areas in Southwest Nigeria. Multistage, purposive and random sampling techniques were used to select 450 vegetable farmers for the study. A structured interview schedule was used to collect data from the respondents. Primary data were obtained on the respondents’ socioeconomic characteristics, yields of wetland vegetables production and cost of production. Data were analyzed using descriptive statistics and stochastic frontier production function. Results indicated that the mean age of the respondents was 45years, with male dominating (74.20%). Most respondents (66.22%) cultivated an average of 0.38ha. The result revealed that at 1% probability level, the diagnostic statistics, sigma squared (0.025) and gamma (0.367), were statistically significant. Allocative efficiency (AE) estimates indicated that wetland vegetable farmers operated below the maximum efficiency with the mean of (0.65), suggesting that, with current technology, an average farmer has the potential to increase cost efficiency by 35%. Labour wage, cost of seed, cost of fertilizer, water, and rent on land were significant (p<0.01) while cost of herbicide and vegetable output were significant (p<0.10) denoting positive influence on the total cost associated with wetlands vegetable production. Additionally, age, education, and household size increase the allocative efficiency of farmers.