TECHNICAL EFFICIENCY IN THE PRODUCTION OF NSUKKA YELLOW PEPPER AMONG RURAL FARMERS IN ENUGU NORTH AGRICULTURAL ZONE, ENUGU STATE, NIGERIA

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TECHNICAL EFFICIENCY IN THE PRODUCTION OF NSUKKA YELLOW PEPPER AMONG RURAL FARMERS IN ENUGU NORTH AGRICULTURAL ZONE, ENUGU STATE, NIGERIA

ABSTRACT

This study determines the technical efficiency level and socioeconomic characteristics that influence the technical efficiency of yellow pepper farmers. Stochastic Frontier function that incorporated inefficiency factors was estimated using a Maximum Likelihood technique to provide estimates of technical efficiency and its determinants using data obtained from 60 Nsukka Yellow pepper farmers in Nsukka, Enugu State, Nigeria. The result shows that the mean technical efficiency was 70 percent indicating the need for improvement in efficiency level for additional 30 percent. The result also indicates that the respondents are operating in the rational stage (stage II) of production as indicated by the return to scale of 0.797. The empirical findings also show that age, number of years spent in formal education, family size and farming experience are important socio-economic determinants of the respondents’ level of efficiency. Farming experience had positive influence on the respondents’ level of efficiency. It was recommended that rural women should be effectively mobilized for full participation in the production of Nsukka yellow pepper through the use of extension agents and community leaders, provision of farm inputs through establishment of channels that will enable farmer access credit facilities and review of land use act to give the rural farmers access to land.

TABLE OF CONTENTS

Cover Page ………………………………………………………………………………i

Certification Page………………………………………………………………………..ii

Dedication………………………………………………………………………………..iii

Acknowledgement………………………………………………………………….…….iv

Abstract……………………………………………………………………………………v

List of Tables………………..…………………………………………………………viii

Abstract……………………………………………………………………………………ix

CHAPTER ONE

INTRODUCTION……………………………………………………………………………………………..1

Backgroung of the study……………………………………………………………………………1

Problem Statement……………………………………………………………………………………2

Objectives of the Study……………………………………………………………………………..3

Hypotheses of the Study……………………………………………………………………………4

Justification for the Study………………………………………………………………………….4

CHAPTER TWO

2.0 LITERATURE REVIEW…………………………………………………………………………..5

2.1 Agronomy of pepper………………………………………………………………………………….5

2.2 Sustainable Resource Use and food Security…………………………………………………6

2.3 Global Agricultural Resource Use Trend………………………………………………………7

2.4 Agricultural Research and Resource Productivity…………………………………………8

2.5 Measures of Efficiency……………………………………………………………………………..9

2.5.1 Technical Efficiency…………………………………………………………………………………10

2.5.2 Allocative Efficiency…………………………………………………………………………………10

2.5.3 Pareto efficiency……………………………………………………………………………………….11

2.6 Related Studies on Efficiency……………………………………………………………………..11

2.7 Theoretical Framework…………………………………………………………………………..12

CHAPTER THREE

3.0 METHOLOGY………………………………………………………………………………………..15

3.1 Study Area………………………………………………………………………………………………15

3.2 Sampling procedure………………………………………………………………………………….15

3.3 Method of data Collection…………………………………………………………………………16

3.4 Data analysis……………………………………………………………………………………………16

3.5 Model Specification………………………………………………………………………………….16

3.5.2 Technical Efficiency Model……………………………………………………………………….17

3.6 Student’s T-test………………………………………………………………………………………..17

CHAPTER FOUR

4.0 RESULTS AND DISCUSSIONS……………………………………………………………..19

4.1 Socio-economic Characteristics of the Respondents…………………………………….19

4.1.1 Gender of the Respondents……………………………………………………………………….19

4.1.2 Age Distribution of the Respondents………………………………………………………….20

4.1.3 Marital Status of the Respondents………………………………………………………………20

4.1.4 Years of formal Education…………………………………………………………………………21

4.1.5 Family Size of the respondents………………………………………………………………….22

4.1.6 Major Occupation of the Respondents………………………………………………………..22

4.1.7 Farm income level of the Respondents……………………………………………………….22

4.1.8 Ownership of Farmland…………………………………………………………………………….23

4.2 Forms of Farming systems………………………………………………………………………..23

4.3 Production ofNsukka Yellow Pepper in the Study Area………………………………..24

4.4 Land Area Cultivated of Nsukka yellow Pepper by the Respondents…………..25

4.5 Influence of socio-economic charateristics of the Respondents on

their technical efficiency……………………………………………………………………………26

4.6 The Efficeincy of Resource use………………………………………………………………….28

4.7 Distribution of the Technical Efficiency indices of the Respondents……………….29

CHAPTER FIVE

SUMMARY, CONCLUSION AND RECOMMENDATION…………………………30

…………………………………………………………………………………………………30

5.2 Conclusion……………………………………………………………………………………………….31

5.3 Recommendations……………………………………………………………………………………..32

REFERENCES………………………………………………………………………………………………….33

CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

Small-scale farmers occupy a central position in Nigeria’s agricultural policy (Ajibefun and Abdukadri, 2004). Agricultural activities in Nigeria seem to be shouldered by small-scale farmers who mostly live in rural communities. These farmers are poor and tend to practice production system that may not utilize resources efficiently.

Small-scale farmers are constrained by lack of credit, which translates to inadequacy of working capital (Kibaara, 2005). This in part brings about the vicious cycle of poverty. The theory of vicious cycle of poverty tries to explain the reason for poor investment of resources (agricultural), which leads to poor output and the consequent low income. However, increment in agricultural output does not depend on heavy investment of agricultural resources. To achieve possible optimum agricultural output from a given set of resources, farmers are confronted with the challenges of increasing the agricultural productivity in an attempt to feed the ever growing population by using resources efficiently.

Resources are of paramount importance in agriculture and these include land, labour, capital and management. The profitability of an agricultural enterprise hinges on efficient utilization of resources needed and available to such enterprise. Clear understanding of resource use patterns by farmers and their adjustment to external factors are necessary for increase in the productivity of agricultural resources (Amaza and Olayemi, 2002). Efficiency of resource use may be defined as the extent to which a given set of resources are being allocated across uses or activities in a manner that maximizes whatever value they tend to produce such as output, market value or utility . Therefore, the efficiency of a farm as a production unit is how effectively it uses resources for the purpose of profit or output maximization.

Rural farmers in Enugu North agricultural zone (Nsukka area) of Enugu State are small-scale farmers with variety of constraints. These constraints include resource availability, resource allocation and difficulties in controlling resources in production process (Awoke and Okorji, 2004). It is expected that these constraints do affect the production of Nsukka yellow pepper in the area.

Pepper is an important vegetable in most societies and plays a significant role in our everyday food. Today, peppers are grown (Capsicum spp) widely in many countries, Nigeria inclusive and it forms an integral part of local cuisine. It adds flavour, colour and pungency to several delicacies. The interest in pepper extends to its nutritional and medicinal values in that peppers are recognized sources of vitamins C and E and are high in antioxidants. These compounds are associated with prevention of cardiovascular disorders, cancers and cataracts. In addition, it can be used for preservation of cowpea against weevil attack (Echezona, 2006).

The varieties of pepper prevalently grown in Nigeria include:

Cayenne pepper or red pepper – ‘Sombo’ ( Capsicum frutescence)

‘Atarodo’ ( Capsicum annum )

‘Tatase’ ( Capsicum annum )

Nsukka Yellow pepper (Capsicum annum)

Nsukka yellow pepper popularly referred to as “Ose Nsukka” owes its name to its characteristic yellow colour and the area it is popularly grown. Nsukka yellow pepper is an important commercial fruit vegetable. Its cultivation forms a major and sometimes the only agricultural activity of rural women in Enugu state (Onwubuya et al, 2008).

1.2 Problem Statement

Pepper production in Nigeria has not attracted the same research patronage like the following crop: cassava, cocoa, rice, to mention a few. The area, the production and yield data are difficult to come by. Regrettably, Nsukka yellow pepper production is towing the same line. Few or no medium and large scale farmer has invested in it. Research interest in it is insignificant. This obviously can be explained by the dearth of records and results from research findings to convince the medium and large scale farmers on the need to engage in Nsukka yellow pepper production by a way of elucidating to them the economic viability of such enterprise. This development has culminated in the bulk of its production to be in the hands of small-holder farmers. Small-holder farmers according to Awoke and Okorji, (2004) are farmers whose production capacity falls between 2.5 and 5 hectares per cropping season.

The production of Nsukka yellow pepper could be said to have remained in the hands of small-holder rural farmers. These farmers like most rural farmers in Nigeria are resource poor and operate on small-scale. They hardly use mechanized and other improved agricultural implements and so it can be asserted that they still carry out their agricultural activities the ‘traditional ways’. This is in line with Olayemi, (1980) who observed that the kinds and qualities of resources used in primary production activities in tropical countries are characterized by forms, which tend to give rise to low output. This also tends to hide the importance and popularity of Nsukka yellow pepper production. It is one of the major agricultural activities of rural women in Enugu State (Onwubuya et al, 2008). Again the markets and industrial requirements are hardly met (NISPRI, 2000). Supply is constrained, thus there is every need to raise productivity of the pepper farmers. This can be done through the farmers’ adoption of improved technologies or improvement in the efficiency of use agricultural resources or both. However, they are often times left with the choice of improving the level of efficiency because of their low rate of adoption of improved technologies due to resource poverty (Idiong, 2007). This foregoing informs for the appropriateness of efficient utilization of resources in the production of Nsukka yellow pepper as a strategy for improvement of productivity in the enterprise. Therefore, this study seeks to provide answers to the following research questions:

What are the socio-economic characteristics of yellow pepper farmers in the study area?

What forms of production systems do the farmers use in the production of Nsukka yellow pepper?

Are farmers efficient in their use of labour, land and capital?

What influences do socio-economic characteristics of the farmers have on their production efficiency?

1.3 Objectives of the Study

The general objective of the study is to determine the efficiency of resource use in the production of yellow pepper among rural farmers in Nsukka area. The specific objectives are to:

assess the socio-economic characteristics of the yellow pepper farmers in the study area.

assess the production systems employed by the farmers in the production of Nsukka yellow pepper,

determine the efficiency of labour, land and capital use in producing Nsukka yellow pepper through the estimation of the responsiveness of the yield to land, labour and capital,

estimate the influence of the farmers’ socio-economic characteristics on the efficiency of their production of Nsukka yellow pepper and

suggest appropriate policies from the empirical results.

1.4 Hypotheses of the Study

The following null hypotheses will be tested.

Ho: the socio-economic characteristics of the yellow pepper farmers have no significant influence on the technical efficiency.

Ho: the use of labour, land and capital have no significant influence on the yield of yellow pepper.

1.5 Justification for the Study

The current situation of Nigeria’s inability to key in on producing pepper for the world market even with the country’s advantage of being able to produce high quality pepper – Nsukka yellow pepper, needs urgent attention. The farmers of Nsukka yellow pepper like most farmers in Nigeria are rural dwellers and appropriate knowledge of how different resources they employ in farms are utilized becomes imperative. This will lead to the farmers’ adjustment of their input use and embrace efficient methods of production, which will consequently lead to reduction in amount resources expended during production and improvement in their farm profit will be guaranteed.

Evaluation of yellow pepper production will necessitate the understanding of how the farmers will allocate and use their resources and improve their productivity, consequently their income. This is important as the country’s agricultural policy objectives include: the increment of food production, increment in the production of agricultural raw materials as inputs for the economy, enhancement of incomes of small farmers and households with a view to alleviating poverty and promoting rural development/employment (WTO, 2005).

Sound knowledge of utilization of agricultural resources in a manner that will enhance the output and minimize waste and it will lead to designing of policies that will increase the farmers’ chances of using resources efficiently. The essence of this study is to present empirical findings on resource use efficiency of yellow pepper production in Nsukka area and fill the gap in resource-use literature.

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