Technical efficiency and artisanal fishing households: Any hope in oil extracting locations? Evidence from Nigeria

Abstract

Artisanal fishing household’s production is investigated using stochastic frontier analysis through Cobb-Douglas production function, which incorporates an inefficiency effects model. Descriptive statistics and profitability index were also used to analyzed the data collected. One hundred and twenty eight households were randomly picked through multistage techniques in the Niger Delta Region of Nigeria. Primary data were chosen using structured questionnaire and interview schedule. Results indicates that greater part of respondents were males with an average age of 42 years who were married with household size of 6 persons. Very many of them did not belong to cooperative society with high educational level. The result indicates that labour, baits and capital inputs were significantly related to output. The average technical efficiency was 73%. This means that the households can still improve their efficiency level by 27%. The structure of production suggests that the returns to scale was 0.9584. The estimated gamma parameter was 0.9423 and was significant at 5% level. Access to credit, membership of cooperative society and fishing experience had an inverse relationship with technical inefficiency while age, fishing distance, gender, number of trips and oil spill had a direct relationship with inefficiency. Artisanal fishing was found to be profitable with a net farm income of N135261.21 and a benefit cost ratio (BCR) of N1.20k. The major constraint to artisanal fishing was pollution. Therefore, the study calls for policies that increases the security of oil pipelines in order to stem the tide of oil spillage and invariably water pollution.