A Comparative Analysis of Economic Efficiency Between Traditional and Improved Rice Varieties Farmers in Oriade Local Government Area of Osun State

Abstract

There is a well established and growing demand for rice in Nigeria as a major staple. Only about half of that demand is met by domestic production, the availability and prices of rice directly impact on the welfare of the poorest Nigerian consumers due to the fact that consumption runs ahead of local production. The study examines and compares the technical, allocative and economic efficiency between improved and traditional rice farmers in Oriade local government area of Osun state. Primary data were collected from 60 traditional and 60 improved rice farmers. Data obtained was analyzed using Cobb-Douglas production and cost function. The result revealed that farm size and agrochemical were significant factors which influence both rice technologies in the area. The return to scale (RTS) reveals that both improved and traditional rice production were in stage II of production surface. The result of the cost frontier shows that labour, agrochemical and output were significant for both for both rice technologies while fertilizer and seed were significant for improved and traditional rice production, respectively. The mean technical efficiency for improved rice production is 0.84 and 0.329 for traditional rice production while allocative and economic efficiencies mean values for both improved and traditional rice are 0.931, 0.773, 0.861 and 0.278, respectively. Conclusively, there is existence of inefficiency in cost for both the traditional and improved rice technologies.